'It's a disastrous situation': Women leaders are leaving companies at the highest rate ever
For women in management, there's never been a better time to quit.
Women leaders are leaving their companies at the highest rate ever, and the gap between women and men in senior roles quitting their jobs is the largest it's ever been, according to new data from LeanIn.org and McKinsey & Company, which started tracking these numbers in 2015.
In its "Women in the Workplace" report, which surveyed 22,000 women and 18,000 men, Lean In and McKinsey & Co.found that it's increasingly important to women that they work for companies that prioritize career advancement, flexibility, employee well-being as well as diversity, equity and inclusion — and they're leaving their companies in unprecedented numbers when these needs aren't met.
Lean In and McKinsey & Co. call this mass exodus "The Great Breakup."
Companies are also at a massive risk of losing young women for the same reasons driving female leaders to quit, as these issues are even more important to women under 30.
"Let's be clear: Women aren't saying they don't want to work," Lareina Yee, a senior partner at McKinsey & Co., tells CNBC Make It.
"They're breaking up with companies because they're confident they will get an opportunity to advance somewhere else, which is something we haven't seen before … it really speaks to the fact that loyalty has its limits."
Women don't want to return to 'business as usual'
Two and a half years into the coronavirus pandemic, new research from the National Women's Law Center shows that women have recouped all of their job losses since February 2020.
Yet as more women return to the workforce, LeanIn.org's co-founder and CEO Rachel Thomas says their patience is wearing thin for companies pushing to return to "business as usual," requiring more time in-office, and letting conversations about employee mental health and diversity, equity and inclusion fall to the wayside after promising to prioritize these issues in 2020.
Working women in the U.S. are among the most stressed employees globally, according to new research from Gallup. And as they continue to undertake more responsibilities at home and at work, they are experiencing burnout and exhaustion at higher rates than men.
The shift driving more female bosses to put in their two weeks' notice, as Thomas sees it, is that these women have seen what's possible when companies "really commit to something," whether it's offering more flexible work arrangements or doubling down on equitable hiring practices — and "they don't want to take their foot off the gas," she adds.
Thomas continues: "They want to work for organizations that remain committed to the things they value and are driving positive change."
Women are still struggling to climb the corporate ladder
More than half (58%) of women under 30 say career advancement has become more important to them over the past two years, compared to 31% of women leaders. Gen Z and millennials value professional development opportunities more than other generations do, numerous studies have shown, and this consistently ranks as a top priority for younger generations when choosing a new employer.
This is especially true for women under 30, Yee adds, who understand that "having a seat at the table matters, and are more willing to ask for it."
But while women aspire to senior management positions as much as their male colleagues, the report found they are far more likely to experience microaggressions that undermine their authority and discourage their ability to advance within a company.
Despite modest gains in representation in leadership, only 1 in 4 C-Suite leaders is a woman, the report notes. Far fewer women than men are being promoted to managerial roles: For every 100 men who are promoted from an entry-level to a manager position, only 87 women and 82 women of color are promoted.
What's more, women leaders are twice as likely as men leaders to be mistaken for someone more junior — and 37% of women leaders have had a co-worker receive credit for their idea, compared to 27% of men leaders.
"It's a disastrous situation … you're not promoting enough women into the leadership ranks, and now you have more women leaving leadership roles," Thomas says. "In a world where women remain dramatically underrepresented in senior leadership, those two problems together create a pretty awful one-two punch for companies trying to hold on to women leaders."
The extra work women do is 'going unnoticed'
Compared with men in similar positions, women managers spend more time on work that promotes employee well-being and fosters diversity, equity and inclusion that falls out of their formal job responsibilities, including helping team members manage their workloads and recruiting employees from underrepresented groups.
Although these contributions boost retention and employee satisfaction, Lean In and McKinsey & Co. found that women are rarely acknowledged for this work in their performance reviews — another trend pushing women to leave their jobs.
"Companies will say that employee well-being and DEI efforts are top business priorities, but all the important, extra work that women managers are doing in these areas is going unnoticed," Thomas says.
How companies can make work a better place for women
Building an equitable workplace where women can thrive starts with fixing the "broken rung," Yee says: making sure women and men are considered for promotions at the same rate, and evaluating the process for promotions to ensure it's equitable.
Flexibility can help improve gender parity, too: Women who have the option to work remotely at least part-time, especially women of color and women with disabilities, experience fewer microaggressions and higher levels of psychological safety, the report found.
Finally, Thomas encourages companies to include metrics related to people management and DEI in their performance reviews, and provide more career development and formal sponsorship programs specifically for women.
"Women are highly ambitious," she says. "And the companies that get these things right will get the very best out of having so many women at the top of their organization — better collaboration, more diverse problem solving, the list goes on — and driving their companies into the future."
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