Women in the Workforce

Between the 1970s and 1980s, women made large strides towards accessing positions of power and authority within the workplace. By the 1990s, however, progression slowed considerably and continues to stall today. According to the McKinsey & Company Women in the Workplace 2022 report, despite modest gains in representation over the last eight years, only 1 in 4 C-suite leaders is a woman and only 1 in 20 is a woman of color.

Women are still faced with the “broken rung” phenomenon holding them back from getting promoted to managerial positions at much lower rates than men. The McKinsey report notes that for every 100 men who are promoted from entry-level roles to manager positions, only 87 women are promoted and only 82 women of color are promoted. Because of this, women cannot catch up and men significantly outnumber women at the managerial level. As the “broken rung” continues, we have also seen that women leaders have been leaving their companies at the highest rate than ever before. For every woman who gets promoted at the director level, two women directors are choosing to leave their employers, according to McKinsey.

Organizations with greater diversity among leadership roles are 2.4 times more likely to outperform their competitors. McKinsey’s Delivering Through Diversity report found that corporations pursuing gender diversity among the executive teams were 21% more likely to experience above-average profitability. Unfortunately, the pandemic has had a significant impact on women. Many opted out of the labor force during 2020, with a large portion doing so due to lack of childcare support. Despite women beginning to re-enter the workforce in efforts to support family costs amidst higher inflation rates, the women’s labor force participation growth rate is forecasted to slow further into 2024.

Representation of Men and Women by Corporate Role and Race 2022

(% of Employees)

Source: McKinsey & Company

Labor Force Participation

According to the International Labor Organization (ILO), the global labor force participation rate for women is just under 47%, whereas men sit at 72%. Almost all countries continue to see a lower participation rate in women in the labor force than men, with some regions reporting a gender gap higher than 50 percentage points. Some of the countries with the lowest gender gap include the US (11.2%), Canada (8.9%), the UK (9.1%), Sweden (6.3%), Germany (9.2%) and Australia (9.4%). Countries in the Middle East and India continue to have some of the largest gaps. In India, the participation rate for women in the labor force sits at only 19.2%, indicating a gap of 50.9 percentage points. Much of the cause for this gender gap in labor force participation stems from cultural norms surrounding women in the country.

Though women have been working to bridge the gap, we continue to see persistent challenges facing women in the labor force today. In 2012, the Harvard Business Review conducted a survey that found 73% of men and 85% of women used the work/family narrative as reason why women continue to have stalled advancements in the workplace. This narrative stems from the idea that high-level jobs require extremely long hours, which women cannot support due to their devotion to family and their careers suffer as a result.

Additionally, women still shoulder the majority of invisible and undervalued household workloads, creating struggles for many between paid work and family responsibilities. Globally, there is a lack of affordable care for children or family members, which further creates obstacles for both women looking for a job and those already in paid work. The ILO reported that this, in fact, decreases a women’s participation chances by almost 5% in developing countries and 4% in developed countries.

Gender Gap in Labor Force Participation Rates

Source: ILO

College Gender Gap

According to the nonprofit National Student Clearinghouse, these days there are roughly three women students for every two men on college campuses. Women became a majority of college students in 1979, with the trend line continuing to rise to today. The latest data suggests that the pandemic has led more men than women to opt out of college. These trends are not unique to the US, as among 25- to 34-year-olds, women are more likely to have a tertiary degree than men in all 38 countries that are members of the Organization of Economic Cooperation and Development (OECD).

Yet, despite the rise in women’s education, women continue to see their pay lag behind that of men. According to Forbes Advisor, in 2022, women earned 17% less than men on average, with women continuing to earn only 82 cents for every dollar a man makes. Additionally, we continue to see men still make up the majority of students in some of the highest-paying fields such as business, computer science and engineering.

Conclusion

The Fortune 500 crossed a milestone for the first time in history at the beginning of 2023, with more than 10% of the businesses on the list having a woman run the company. However, 72% of women leaders under the age of 35 have reported a heightened feeling of burnout, according to global leadership consulting firm DDI. As we continue to bridge the gap, leaders should prioritize wellbeing, flexibility and family support, as these are benefits many women are seeking either to stay with their current employer or to re-enter the workforce. Ultimately, making strides to close the gender gaps in the labor force are not just good for women and their households, but beneficial for the global economy as a whole.