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Lack of women in managerial positions is a solvable problem, says Visier report

Toronto workplace analytics company Visier has released a Gender Equity report which researched data related to the wages of 165,000 employees at 31 American companies, finding that the gender wage gap, rather than closing is in fact widening and that women’s pay declines from 90 cents on the dollar from age 32 until age 40, when women’s pay drops to 82 cents on the dollar.
In a nutshell, the problem is less about opportunities for promotion than it is about workforce participation, with women often taking time out for a child at the age of 32, roughly the same point at which a man’s career kicks into prime earning territory.
“Having a child shouldn’t undermine the earning potential of women, but our study shows that it still does,” says Visier Founder and CEO John Schwarz. “I believe employers today have good intentions to achieve gender equity, but have been lost in chaotic and conflicting data sources. Business leaders need to be  making decisions based on confident knowledge, not on guesswork. We at Visier are on a mission to enable that.”
The wage gap created by parental leave overwhelmingly taken by more women than men can be fixed, at the risk of pointing to yet another Scandinavian solution, by the introduction of something similar to Sweden’s “daddy leave” policy, which was introduced in the 1970s.
Upon the introduction of an incentivized policy in Sweden for fathers to take as much parental leave as mothers, the percentage of fathers taking parental leave rose from 6% to 80%, and “each additional month that the father stays on parental leave increases the mother’s earnings by 6.7%,” according to the Swedish Institute of Labor Market Policy Evaluation.
Only four state governments in the United States, California, New Jersey, Rhode Island, and New York, have legislated paid family leave, which is funded by employee payroll deductions, covering between 55% and 67% of worker’s wages.
A survey conducted by California found that the legislation “had either ‘no noticeable’ or a ‘positive effect’ on productivity (89%), profitability/performance (91%), turnover (96%), and employee morale (99%).”
There are other issues at play besides workplace promotion and parental leave.
Goldman Sachs produced a report asserting that narrowing the gender gap in entrepreneurship would increase global income per person by approximately 20% by 2030.
Research presented at the Women 2.0 conference in San Francisco found that women-led private technology companies are more capital-efficient, and achieve 35% higher return on investment, while venture-backed companies led by women bring in 12% higher revenue than male-owned tech companies.
And yet, startups founded by men are 86% more likely to receive venture capital funding than those founded by women, and on average men start their businesses with nearly twice as much capital as women.
“Every CEO should be looking at gender equity,” says Schwarz. “Countless studies have shown the equal economic contribution women make in the workforce, yet companies have struggled to achieve the goal of equity in compensation. With this Visier Insights report—made possible by the contribution of our customers to our unique workforce database—we give leaders the factual basis on which to implement programs that can accelerate gender equity. It turns out that the gender inequity is not just a compensation issue, it is a problem of unequal participation of women in the higher paying managerial jobs.”
The Visier report contains a number of concrete recommendations that corporate Canada can implement to improve the situation.

  • Implement the Rooney Rule: for every manager position you have open to fill, consider “at least one woman and one underrepresented minority” in your slate of candidates
  • Implement blind screening, removing names (or other gender identifiers) from resumes when selecting candidates for interviews
  • Increase measurement and awareness of gender equity in the rollout or implementation of HR policies, including compensation policies
  • Support meaningful paid parental leave that is equal for both men and women
  • Ensure it is socially acceptable for both men and women to take time off to care for their children
  • Support programs that increase the availability of good quality affordable childcare for all parents
  • Ensure it is socially acceptable for both mothers and fathers to make use of flexible working time arrangements to care for children
  • Develop and support long-term programs—starting in grade school, throughout high school and college—aimed at removing the gender bias and social taboos associated with career choices

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