Women are leaving the workplace: What companies need to do

By Gautam Kumra

Women are demanding more from work — and they’re leaving their companies in unprecedented numbers to get it. Our research shows that women leaders are switching jobs at the highest rates we’ve ever seen — and at higher rates than men in leadership. The results from our annual Women in the Workplace survey of over 40,000 employees of corporate America show that we are amid a “Great Breakup” between women and their jobs.

Women are already significantly underrepresented in leadership. For years, fewer women have risen through the ranks because of the “broken rung” at the first step up to management. Interestingly, our research has shown that young women are more ambitious than men and place a higher premium on working in an equitable, supportive, and inclusive workplace. But the “broken rung” is affecting representation — women are watching senior women leave for better opportunities, and they’re prepared to do the same.

In Asia Pacific, we are starting from a lower base than in other regions. There is only one woman in a leadership position for every four men. Australia is at the top end of the spectrum — approaching 30 percent of leadership roles held by women — but at the other end, the figure is about 3 percent in Japan and 5 percent in India.

This is a waste of talent that the region cannot afford, especially when many economies in Asia are aging, labor pools are eroding, and skills shortages are on the rise. Looked at another way, advancing women’s equality in Asia Pacific between 2018 and 2025 could add $4.5 trillion to the region’s collective GDP annually, a 12 percent increase over a business-as-usual GDP trajectory.

Fixing the pipeline

At company level it’s a major missed opportunity because, put simply, gender equality is good for business. Our global research shows that companies in the top quartile of gender diversity are 25 percent more likely to outperform from a total-returns-to-shareholders perspective.

Most companies are grappling with two pipeline problems:

1. A “broken rung” at the first step up to manager is holding women back. For every 100 men who are promoted from entry-level roles to manager positions, only 87 women are promoted. The result is a domino effect — men significantly outnumber women at the manager level, and women can never catch up. There are simply too few women to promote to senior leadership positions.
2. Women leaders are leaving their companies at the highest rate we’ve ever seen — and at a much higher rate than men leaders. To put the scale of the problem in perspective: for every woman at a director management level who gets promoted to the next level, two women directors are choosing to leave their company. More women leaders leaving their jobs creates a new pipeline problem for companies.

In our 2018 report, The Power of Parity: Advancing women’s equality in Asia Pacific, we found that the smaller share of women in Asian company leadership isn’t all about the glass ceiling. The relative lack of women in the top positions in business has its roots far earlier in the talent pipeline — one that runs from enrolment in tertiary education to entry-level positions, middle management, and the boardroom.

To make meaningful and sustainable progress toward gender equality, companies should consider focusing on two broad goals: getting more women into leadership and retaining the women leaders they already have. That will require pushing beyond common practices.

Companies with better representation of women are doubling down on setting goals and holding leaders accountable. They’re offering more specific and actionable training so that managers are better equipped to achieve these goals. And they’re offering a constellation of benefits to improve women’s day-to-day work experiences to include greater flexibility, emergency childcare benefits, and mental-health support. Companies that want to see better results should follow their lead.

The last three years have seen all of us reimagine the way we work. This is especially true for women. Women are ambitious and hardworking. They’re inclusive and empathetic leaders. And they want to work for companies that are prioritizing the cultural changes that are improving work for all women.

This International Women’s Day, we recognize that companies that rise to the moment will attract and retain women leaders. This will not only help address issues of ageing societies and skills shortages, it will also deliver the growth dividend that Asia Pacific needs. It will also lead to a much better workplace for everyone.