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2 posts from July 2018

30 July 2018

Nudging women into tech

Where are all the women in tech?

The lack of female representation in STEM and especially in leadership positions is a crucial barrier to gender equality. Women currently hold only 19% of tech-related jobs at the top 10 global tech companies, relative to men who hold 81%. Why do more women and girls not opt into careers in STEM fields, especially emerging tech?

Early engagement with STEM lagging for girls

The proportion of females to males who graduate with STEM-related degrees is out of balance. Cultivating an interest in STEM fields should start as early as possible. From an early age, behavioural design can help through de-biasing classrooms, changing how our children are taught, as well as through celebrating counter-stereotypical role models.

Work-family balance

In the workplace, the ‘leaky pipeline’ can further explain the lack of female representation in STEM jobs. There is a continuous haemorrhaging of women out of work as they exit their careers over time, especially as they become mothers. According to a recent PwC survey of 3,600 professional women globally, 42% feel nervous about the impact that starting a family could have on their career and 48% of new mothers felt overlooked for promotions and special projects upon their return to work. Across sectors and in the tech industry, women are concerned about the implications of motherhood and the flexibility penalty for their careers.

Given the need to foster the participation of women in our workforce, addressing the reasons that cause women to leave their employers, industry or careers more generally is vital. Businesses should support working mothers and nurture their careers through implementing flexible policies, allowing sufficient parental leave (for both parents) and promoting advancement programmes in a way that prevents potential biases and provides organisational solutions that work. To remain relevant, businesses will need to have a clear strategy to retain the right employees, customers, and partners, regardless of gender.

Gender equality is more than a moral imperative

We estimate sizeable economic benefits if we close the gender gap. For example, in South Africa, our calculations suggest economic growth spin-offs of additional 3.2% in GDP growth and a 6.5% reduction in the number of unemployed job seekers by closing the gender gap in both pay and representation by just 10%. Enormous economic opportunity lies in promoting gender workforce equality.

The benefits extend to the emerging tech industry as well. Emerging tech is only as well rounded as the people who teach it. It is a crucial field for women to help shape. If primarily half of the population designs technology, users are missing out on the insights of the other half. Fostering inclusivity will help introduce new viewpoints and new ideas to emerging tech.

What can we do to advance gender workplace equality?

Experts tell us that biases exist in our daily lives and behavioural measures, or ‘nudges’, are one instrument in our collective toolbox to correct for gender imbalances in education and work. They offer low-hanging fruit to promote female representation in emerging tech and establish new foundations for inclusive economic growth.

Nudges in school and higher education

The tech industry boasts many exceptional female leaders. It is crucial to celebrate these role models and bring attention to them, especially for girls at a young age. It is hard for young girls to aspire to something they cannot see, and the mantra applies ‘seeing is believing’.

We can cultivate an early interest in STEM-related fields by bringing attention to female role models in STEM careers. Research shows female learners are more likely to continue their studies in a STEM subject when they had a female STEM teacher. Further increasing the fraction of counter-stereotypical people in positions of leadership solves a chicken and egg problem - it can change men’s and women’s beliefs about what an effective leader looks like and challenge many of the biases that hinder gender equality.

Nudges in hiring

In the hiring process, gendered language in job ads can preselect applicants, denying firms the possibility of exploiting the full potential of the talent pool. A job ad for a teaching role at a primary school that refers to the ideal candidate as ‘warm and caring’ will likely attract fewer male applicants than if the ideal candidate had to offer ‘exceptional pedagogical skills’. The same principle applies to emerging tech jobs. The language used in emerging tech job ads represents a barrier women face in partaking in the emerging tech revolution, as well as derails efforts by organisations looking to benefit from the full breadth of available talent.

The simple solution is to purge gendered language from job ads. First impressions also matter in recruitment sessions, where the presence of women speaking on technical subjects is a crucial driver of female audience engagement. These nudges are especially important as women consider more factors than men when screening jobs – in particular, cultural fit, values, and managerial style.

Nudges in career development and progression

In career development, gender differences in self-confidence play a crucial role. Many firms ask their employees to evaluate themselves and then to share these self-evaluations with their supervisors. Self-assessments entrench gender biases through anchoring, where women will generally underrate their performance, which serves as an unconscious, low reference point for evaluators. The easy solution is to do away with self-assessments wherever possible, or at least to avoid sharing self-assessments with evaluators ahead of performance reviews.

Nudging for prosperity

We can bring more women into tech by realising that an interest in these fields should be cultivated from an early age and understanding why women opt out of careers in STEM. Simple nudges like bringing attention to female role models, purging gendered language from job ads and avoiding self-assessments can change the context in which we make decisions and sustainably correct gender imbalances in the workplace.

The benefits are clear: economies and businesses can thrive by deploying the full potential of their workforce, women and men alike, to drive prosperity in the face of the next digital revolution.

Find out more and explore the full 16 nudges we recommend for more #WomeninTech by downloading our report.

By Maura Feddersen and Nina Kirsten, Economists at PwC, Strategy&

Feddersen Maura Feddersen is an economic consultant with PwC Strategy&. She develops economic tools to help organisations position themselves optimally in relation to continuous shifts in their economic and regulatory environment. Maura analyses economic trends in the global and domestic economy and provides regular media commentary on the strategic implications of these trends. She is passionate about behavioural economics and consumer sciences and their power to improve business success and enhance policy effectiveness. Maura is a co-author of PwC’s thought leadership ‘16 nudges for more #WomenInTech’, where she explores behavioural measures to foster women in emerging tech, and writes regularly on how behavioural economics can solve problems in the public and private sectors.

 

Kirsten Nina Kirsten is a Senior Associate at PwC, based in Johannesburg, South Africa. She is an economist in the Economics practice within PwC Strategy&. She has a keen interest in Behavioural Economics and is the co-author of ‘16 nudges for more #WomenInTech’, which explores several behavioural measures that can be employed to bring more women into the field of emerging tech. Through consulting, she dives deep into the cognitive processes that can be leveraged to unlock value within organisations.

09 July 2018

Women in Work Index – what is driving the OECD gender pay gap?

The sixth annual update of the PwC Women in Work Index shows that gains in female economic empowerment have been made across the OECD countries, but the pace of change remains gradual. Our index combines five key indicators of female economic empowerment: the equality of earnings with men; the proportion of women in work, both in absolute terms and relative to men; the female unemployment rate; and the proportion of women in full-time employment.

As in previous years, Iceland, Sweden and Norway remain the top three performers. The largest movers – Poland and Hungary – both saw a rise of three ranks with strong improvements in female participation in the labour force. Most countries have also achieved gains in absolute terms. For example, Spain saw one of the largest annual increases in its index score, due to an increase in the share of women working full-time, while the pay gap and female unemployment has fallen. Looking at longer-term changes since 2000, United States, the largest OECD economy has fallen quite significantly from 9th to 21st position. This is mainly driven by falling participation in the labour market and rising unemployment amongst women over the past decade.

The UK fell from 14th position to 15th as improvements in female labour market conditions were outpaced by other OECD countries. In particular, the UK’s pay gap (defined as the difference in median earnings between males and females) is closing only very gradually and is still slightly above the OECD average, while little progress has been made to improve female full-time employment. There are significant regional variations within the UK. London continues to perform poorly with the largest pay gap, mainly driven by its relatively higher concentration of businesses with high pay gaps such as financial services and professional services.

This year, we conducted an econometrics analysis to investigate the drivers of the gender pay gap across the OECD countries, using a dataset of 35 countries over 16 years. Our results showed that much of the pay gap is explained by structural factors, such as the tendency of women to work in lower paid services sectors or in part-time work and taking time off from work to care for the family, which remain persistent over time. We find that increased government spending on family benefits, such as childcare, can help reduce the pay gap as this can help support women returning to or staying in work. Countries with a larger share of female employers also tend to have lower gaps, which could potentially suggest that female entrepreneurship has a positive impact on gender equality in the workplace.

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Our analysis points towards the important role that government policy can play in creating a more gender neutral workplace. Firstly, enhanced social support for childcare and family support can boost female participation in the workforce, particularly for full-time roles. We also found that generous lengths of paid maternity leave can worsen the pay gap and make it larger. This somewhat surprising result suggests that longer leave periods mean women spend more time outside of work, which could negatively impact their future earnings potential. Policies such as Shared Parental Leave (SPL) aim to correct this by levelling the playing field between parents, and encourages the sharing of caring responsibilities so that women can return to work. Some countries, such as Sweden, have introduced non-transferrable “use it or lose it” quotas for fathers and economic ‘bonuses’ for families that divide parental leave more equally.

Businesses also have a big responsibility to provide both men and women equal opportunities to reach their full potential at work and close the pay gap. The recent introduction of mandatory pay gap reporting in countries such as the UK and Australia helps push businesses in this direction. Early disclosures reveal how far we have to go to close the gap, but greater transparency will hold companies accountable to take action and gradually motivate change. Furthermore, there is a serious need to “fix the leaky pipeline” to improve female representation in senior positions, such as providing more flexible opportunities for women in higher-paying and higher-skilled roles, or encouraging women to return to work following career breaks with “returnship” programmes. This can help build a pipeline of female leaders, with clear benefits: evidence shows that gender-diverse boards representing diversity of views can improve business performance.

The gains to closing the gender pay gap are substantial – US$2 trillion for the OECD – a massive prize to be achieved.

Authors:

Yong Jing Teow 
Economist
Tel: +44 (0) 207 804 4257 

Saloni Goel 
Economist, PwC United Kingdom 
Tel: +44 (0)7730 596332

Swati Utkarshini 
Economist, PwC United Kingdom 
Tel: +44 (0)7843 370811