Leveling the Playing Field For Women in the Workplace
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In the last four decades, women have grown from a minority in the workplace to active decision-makers. In 1970, only 32 million women were in the U.S. workforce. Today, almost 75 million women are U.S. employees, and 27% are chief executives. Women own nearly 10 million businesses, and 61% of Fortune 500 companies have female directors (up from 33% in 1995).
Sounds like good news, doesn’t it? Well, it’s not. The truth is that U.S. economic policies have failed to match the pace of the growing influence of women. Workplace benefits and financial empowerment are not the same for men and women, which raises many concerns. In this blog, we share Heather McCulloch ’s thoughts on the ignorance of women’s genuine issues and how we can build a gender-equitable workplace that supports them.
Read Between The Lines – Hidden Gender Bias in the U.S. Economy
Our economic systems and policies have long been designed without considering women's roles and contributions. This oversight has led to significant disparities in how women benefit from various economic structures compared to men. Let's examine some key areas where this gender bias is evident:
1.???? Tax Code Inequities
The U.S. tax code, a complex web of policies typically negotiated behind closed doors, disproportionately benefits higher earners and those with certain types of income. Refundable tax credits, most likely to benefit women due to their generally lower earnings, make up only a tiny fraction of federal tax expenditures. Furthermore, the joint filing system often creates a "marriage penalty" for two-earner couples, where the secondary earner (usually the woman) faces higher marginal tax rates when their income is stacked on top of the primary earner's income.
2.???? Employer-Based Benefits Gap
Women make up 55% of all part-time workers in the U.S., often in roles such as secretaries and elementary teachers. However, only 23% of part-time workers have access to medical insurance, and just 42% have access to retirement benefits, leaving women at a disadvantage. This disparity highlights a systemic failure to support women in the workforce.
3.???? Social Security Shortcomings
In the U.S., women comprise 65% of all unpaid caregivers, devoting an average of 296 hours annually to caregiving, compared to men’s 194 hours. Despite this significant contribution, the U.S. lacks a system to properly recognize and compensate unpaid care work, unlike countries such as the U.K., France, Germany, and Sweden, which provide caregiver credits toward public pensions. On average, women receive Social Security benefits that are only 80% of what men receive, and without Social Security, more than half of elderly women in the U.S. would be living in poverty. This absence of support puts women at a financial disadvantage in retirement.
4.???? Misrepresentation of "Women's Issues"
Despite women’s contribution to the U.S. economy, their challenges (such as lack of paid leave and inadequate elder care support) are often dismissed as “social issues” rather than core economic concerns. This misclassification hinders progress in addressing these critical problems.
By ignoring the above concerns during policymaking, we are subconsciously perpetuating gender inequalities. To create a genuinely equitable economy, policymakers and business leaders must actively consider how their decisions impact women and work to redesign systems that support all contributors to our economy.
Investing in Women: A Key to Economic Growth and Prosperity
The United States lags behind other developed nations in recognizing and capitalizing on women's economic contributions. While many OECD countries have implemented policies to support women's workforce participation, the U.S. infrastructure remains inadequate, hindering women's ability to balance work and family responsibilities.
Failing to invest in women's economic participation comes at a significant cost. According to Federal Reserve data, addressing gender gaps in employment and earnings could add nearly $2 trillion to the U.S. economy. When considering both racial and gender disparities, this figure rises to $3 trillion. Moreover, implementing care policies comparable to those of?other advanced economies could bring an additional 5 million women into the workforce.
Women are also underrepresented in leadership roles across various asset classes. For instance, 75% of startup funding goes to all-male teams, while women entrepreneurs receive only 0.5% of all startup funding. This disparity persists even though women-led startups are 11 times more likely to become unicorn companies if they survive initial funding rounds.
The need of the hour is to invest in a robust care infrastructure to unlock women's economic potential, which includes:
1.????? National childcare programs
2.????? Paid family leave
3.????? Long-term care support for elders
4.????? Pro-rata benefits for part-time workers
5.????? Credit for family caregiving
These policies, common in other OECD countries, help women balance work and caregiving responsibilities, enabling them to remain active in the workforce. By addressing the shortcomings in our care infrastructure and promoting gender diversity in business and finance, the United States can tap into a significant source of economic growth and innovation.
The Economic Imperative of Diversity and Inclusion: Why Now Is Not the Time to Pull Back
Despite the risk of political backlash surrounding equity and inclusion initiatives, this is the time to lead by example. Acknowledging and resolving women’s challenges is necessary from both moral and economic perspectives. As our nation evolves demographically and economically, embracing diversity and inclusion becomes increasingly vital for sustained growth and prosperity.
Currently, the United States is facing significant demographic changes that will profoundly impact our economy. The number of workers aged 65 and older has nearly quadrupled since the mid-1980s, reaching about 11 million today. At the same time, the U.S. is projected to become a nation with a majority of people of color within the next two decades. These dual trends of an aging population and growing diversity will reshape the labor market and economic landscape, requiring thoughtful policies to maximize workforce participation and leverage the skills of all demographics.
Here is how we can overcome these challenges:
1.????? Embrace diversity as an asset: Recognize that our nation's diversity is a strength that can drive innovation and economic growth.
2.????? Nurture diverse talent: Invest in mentoring and supporting women and people of color to fully contribute to the economy.
3.????? Advocate for supportive policies: Use your influence to push for public policies that enable all individuals to participate in the workforce, such as comprehensive care infrastructure.
4.????? Build inclusive investment teams: Continue efforts to diversify decision-making tables in finance and business.
5.????? Invest in diverse-owned businesses: Seek out and support companies owned or co-owned by women and people of color.
Creating an inclusive economy is not just a matter of social justice but an economic imperative. Those with resources, power, and influence in the business and investment world are critical in shaping policies and practices that leverage our nation's full potential. By committing to this initiative, we can build an economy that truly works for everyone, benefiting marginalized groups and the entire nation's economic future.
About The Speaker
Heather McCulloch is a staunch advocate and thought leader committed to closing the racial and gender wealth gaps and building an equitable economy. She founded Closing the Women’s Wealth Gap, a network of leaders to transform public policies and systems to advance gender equity. Heather was also the founder of Asset Building Strategies, where she helped non-profit and public leaders build financial security for low-income families. Heather is currently a senior fellow and entrepreneur in residence at the?Aspen Institute Financial Security Program to shed light on women’s challenges in the workplace and propose viable solutions.
Watch her full keynote here .
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Membership Associate | Inside sales | Keiretsu Forum Northwest | MBA
2 周Good point!
Director of Membership & Events @Keiretsu Forum | Advisor | Board Member | Angel Investor
2 周Well said!