Originally published January 21, 2023 , updated on July 11, 2024

A new report from McKinsey & Co. and LeanIn.org paints a discouraging picture: Women remain underrepresented in leadership roles and are increasingly exiting the corporate world at an alarming rate. 

In fact, according to the study, when a woman is promoted to a director-level position, two other female directors choose to leave their company. As a result, women’s representation within corporations is declining significantly. It indicates a need for improved gender diversity among employees in upper management positions. 

It’s evident that companies must do more to ensure that women have greater access to advancement opportunities in business. They should also be able to fulfil their aspirations without fear of stagnation or discrimination.

This trend of women leaving the top ranks of organisations at increasing rates reflects an absence of workplace support and culture to advance women into leadership roles. This unfortunate trend also means that companies are losing out on invaluable contributions from female talent. These employees may be leaving due to a lack of opportunity or difficulty in the workplace.

To ensure equal access to leadership roles, companies should evaluate their promotion policies. They need to consider changes that encourage diverse outlooks and backgrounds to reflect the demographics of their workforces better. Additionally, they should explore mentorship opportunities. That’s because it is a great way to provide guidance and coaching to help capable women reach their leadership potential.

Companies must invest in providing equal opportunities and career development paths. They should enable female employees to achieve their goals without feeling like they have reached a glass ceiling of advancement or have no support system they can tap into to gain new skills. Organisations must strive to ensure women of all backgrounds can reach their potential if they desire.

Women in the Workplace Post-Pandemic

Women have long faced unique challenges in the workplace due to their gender. But the Covid-19 pandemic has resulted in a situation where these disadvantages are worse than ever. As access to quality and affordable child care became increasingly difficult during the pandemic, a disproportionate number of women had no choice but to leave the workforce. 

At the same time, any progress made on closing the gender pay gap also stalled. It left women struggling even more financially. With changes needed on both fronts to ensure that the current economic downturn does not unduly hurt women, we must take steps now to ensure these issues don’t become further entrenched.

In recent years, the female labour market has undergone a transformative shift. It happened because more and more women are leaning away from traditional roles that don’t offer true fulfilment. Women in command posts have revealed a desire to break out of the expectations set upon them. It triggers a dramatic uptick in job switches as they pursue happiness and purpose elsewhere. 

This movement illustrates that women are no longer going to accept jobs simply because they meet society’s requirements of what success is supposed to look like. Instead, they’re looking for meaningful work that offers them joy and supports their ideals for personal growth.

The Curse of the Broken Rung

Women face a unique set of challenges in the workplace, especially regarding promotions and receiving monetary bonuses. The study shows they often face discrimination, sexual harassment and additional unpaid work that goes unrecognised or unrewarded. 

No one should be overlooked for promotions or expected to do extra duties without appropriate compensation. Unfortunately, such issues are pervasive and can lead to poor morale and decreased productivity. While businesses have put in place initiatives such as gender equality and diversity programs to ensure greater fairness, they need to do more to tackle these ongoing problems effectively. 

The statistics on women’s promotion to managerial positions paint a stark picture of gender inequality in the workplace. Women continually face an uphill battle when trying to break through male-dominated workplaces. It’s even much less when waiting for their chance to be promoted. 

With almost 15% fewer women and a further 13% fewer women of colour being promoted from entry-level positions compared to men, it’s no wonder why men outnumber women at manager levels. This lopsidedness has been established for years, making it much harder for even well-qualified women to catch up. 

Making Progress in Careers

Without more equitable representation amongst senior leadership teams and executive boards, women will always start from behind. They fight against overwhelming odds to make progress in their careers.

The ‘broken rung’ that has long prevented women from taking the first step up to manager is one of the main factors contributing to the current scarcity of female leaders in many companies. This broken rung is hard for many of these organisations to overcome. It gets harder especially when there are often even fewer women of colour in these positions than white women. 

To add further complexity, companies are now having to work harder than ever to retain those relatively few already-established female leaders they do have. Navigating these multilayered dynamics requires outside-the-box thinking and creative solutions. It also needs dedication and persistence from the relevant businesses if true progress is to be made.

Why Women Leaders are Leaving the Workplace

There are seemingly countless reasons that stem from generations of injustices. They all lead to women facing discrepancies in the workplace today. And with the shifting times, new issues have risen. They make leaving more appealing for both women leaders and the younger generation of workers. Below are a few of the major reasons women are leaving the workplace. 

Lack of Diversity

The lack of diversity at the highest levels of organisations adversely affects women of colour. It happens in ways that may not be immediately apparent. With fewer people in senior positions who share these professionals’ experiences, they often don’t feel as supported or understood as their white peers do. It can make it difficult to strive for and succeed in leadership roles. 

Companies must take a proactive approach to promote gender diversity in their ranks if they wish to combat this imbalance. Diversity initiatives should focus on creating more supportive and inclusive environments. Also, it’s necessary to provide development programs tailored to women of colour that provide tangible benefits and career advancement opportunities. Doing so will help close the current gender gap at the top. It also creates organisations that actively embrace healthy workplace diversity.

Insufficient DE&I Efforts

More and more female executives today are vocal about voicing their needs to advance company policies that promote greater equity. Women in leadership roles are no longer content to accept the status quo. They are increasingly insisting that their employers reflect their values, including a commitment to creating flexible and supportive work arrangements. They consider employee well-being when making decisions, and investing in DEI initiatives. 

As women continue to break the glass ceiling and ascend into leadership roles in the corporate world, they are looking for employers who share their values and life priorities. Instead of passively accepting what a company offers, many female leaders recognise that they have greater power to shape and determine the terms of their employment when applying for jobs. 

They now actively look for organisations that provide flexible work arrangements and attend to employee well-being. They also look for environments that promote DEI initiatives like incremental progress at all levels. As these standards move from optional to required among modern-day job seekers, more corporate establishments are compelled to meet progressive women leaders’ expectations.

Women leaders have a unique understanding of the need for a better work culture. They know that it’s essential to create an environment that is productive and successful. The environment should also prioritise employee well-being, diversity, equity, and inclusion. 

This has become even more important over the past two years. That’s because women leaders are increasingly likely to leave their jobs. They do so if they do not believe their values are being respected or reflected in their working environment. Women leaders are making a clear statement; they want workplace cultures that embody fairness and inclusivity.

Decreased Recognition

Women have been found to go the extra mile when it comes to supporting employee well-being and fostering DEI in the workplace. From providing company-wide mentorship for professional growth and creating continuous learning opportunities to ensuring a culture of inclusion, understanding, and acceptance within their teams, women leaders are changing the corporate culture in ways men at their level may not be doing. 

People don’t acknowledge the effects of this leadership as often as they should; without recognition and reward, an employee’s motivation to work towards these goals can plummet. This situation leads to low retention rates and decreased job satisfaction levels. 

It is disheartening to learn that 40% of women leaders feel their work in diversity, equity, and inclusion is going unrecognised when it comes time for their performance review. It can be even more discouraging when the same women feel that extra effort has gone into making progress with DEI initiatives. 

Unfortunately, this sort of unacknowledged hard work could lead to an employee feeling undervalued. It creates demotivation around progressing their career any further. This serves as an important reminder to organisations that a strong DEI culture must go beyond words. It’s highly important if they want to attract and retain talent. It’s imperative we recognise and reward female leadership skills to foster meaningful change.

The Disconnect in the Tech Industry

Despite strides in gender equality, it is clear that the engineering and technical fields remain heavily male-dominated. According to statistics, women are far less likely to be employed in these types of jobs when compared to their male counterparts, with the ratio of women’s representation in these roles lower than it was even two years ago. 

To make matters worse, this has resulted in a situation where female professionals who do manage to break into the field are twice as likely as the average woman to find themselves working in a room full of men. An initiative aimed at promoting greater diversity and inclusion amongst engineers and technical personnel should be reinforced to close this gap between men and women in this field.

Women in technical roles often face disproportionately higher rates of bias. That happens due to their gender because their expertise and professional accomplishments are more often challenged and dismissed. This phenomenon can also have an impact on future opportunities for these women. It creates additional roadblocks as they strive for career advancement based purely on merit and skill. 

Such an uneven playing field makes it more difficult for the industry as a whole to identify and embrace strong potential candidates, regardless of gender.

What to Expect in the Future

The factors that drive female leaders away from their companies are of serious concern to young women. Many jump at the chance to advance, with two-thirds of those under 30 hoping to become senior leaders. Moreover, many young women have recently reported that advancement has become even more important in the last couple of years, according to the McKinsey study.  

This serves as a reminder that it is increasingly important for companies to create an environment where young women feel valued and appreciated. They should be able to make progress within their chosen fields. By creating such an atmosphere, employers stand to benefit from the passion and dedication these ambitious young women can bring to their businesses.

With young women increasingly becoming focused on work-life balance and commitment to diversity, equity, and inclusion from their future employers, companies needing to address these issues may face difficulty recruiting and retaining these new generations of female leaders. 

For organisations already dealing with a “broken rung” in their leadership pipeline, this lack of action towards creating a more inclusive and equitable environment could have catastrophic implications. Employers need to recognise the changing mindset among younger women. They should prioritise creating the best possible working atmosphere that leaves no room for inequality or discrimination.

As we welcome a new year and chapter in our society, it’s important to reflect on the impact of gender equality and women in the workplace to truly make a change in the future. 

One of the most important aspects to consider is implementing an impactful CSR strategy and looking at companies that are making those strides already. Goodman Lantern offers professional and effective DE&I strategy services to help your company achieve gender equity and reap the rewards. 

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