A new analysis from the National Women’s Law Center revealed that a shocking number of women—865,000—dropped out of the labor force between August and September this year. Just a few weeks prior to last week’s announcement, McKinsey & Company and LeanIn.org released the annual Women in the Workplace study of 317 companies representing over 12 million employees. The study found that 1 in 4 women are considering downshifting their career or leaving their company due to the impact of COVID-19, which have escalated women’s combined work and family pressures.
Three in four women who said they are considering leaving the workforce pointed to “burnout” as the main reason. As reported by ABC News, McKinsey’s report noted that “women with children were three times as likely as fathers to be responsible for a majority of the housework and child care amid the pandemic” and that “women in senior-level roles were all more likely than other women to be mothers.” As more work moved from the company office to the home office, women were left shouldering even more than their previous double shift—and this reality took a quantifiable toll in women’s exodus from Corporate America.
While the pandemic opened up and accelerated the exodus of women and brought it to the forefront, the challenges and headwind were present prior to COVID-19. In SHAMBAUGH’s own work, we have seen a building trend of regrettable losses of female talent across diverse industries, and this has a created a significant financial impact that companies must be aware of as well: it takes 1.5 to 3 times an employee’s annual salary to replace that lost talent.
The Society for Human Resource Management has estimated the average cost to replace a salaried employee is 6-9 months’ salary. That means if you lose an employee who earns $60,000 a year, you’ll end up with around $30,000 to $45,000 in costs to recruit and train a new worker. Some studies suggest that the costs run even higher, especially for senior-level employees, perhaps up to double their annual salary.
There’s a problem here not just for women, but for employers as well. When organizations lose their women leaders, they also lose the impact that those women make within their firms and on their teams. Everything we already know about the positive impact of women’s leadership on business results and the bottom line comes to bear here—not to mention that as the McKinsey report warned, losing senior-level women can impact women’s chances for advancement throughout a company, since “women are more likely than senior-level men to advocate for gender and racial equality and mentor women of color.”
With these realities in mind, companies should act proactively to gain an immediate pulse of their talent. SHAMBAUGH’s Giving Women a Voice—A Survey to Engage and Retain Women Talent emphasizes that it’s important to understand how women in your organization are experiencing your company’s culture, career opportunities, feedback, training and coaching, mentoring, and HR practices—as well as understand women’s beliefs and assumptions, and those of their managers.
Also, part of women leaving traces back to what I call their “Sticky Floors”—hidden behaviors that can sabotage career success, such as avoiding speaking up in important meetings, lacking confidence and self-awareness, asking for what they want, and capitalizing on their political savvy. These are all learnable skills, and ones that SHAMBAUGH addresses in many of our trainings, including our Women in Leadership and Learning Program and our Leadership Development training courses.
I’d like to offer a three-part call to action that can help companies retain their female talent during the pandemic and beyond:
- Be proactive. Don’t wait until your top talent walks out the door to discover what went wrong. Take steps on the front end to understand how women in your organization are experiencing the company’s culture and practices. Conduct regular listening tours to gather feedback and insights from all levels of the company.
- Start the conversation. Part of being proactive should involve starting the conversation to find out what specific challenges that women in your organization are experiencing during the COVID-19 era. Many employees are now juggling even more than they were before at home, with some parents taking on additional responsibilities such as homeschooling their kids during school closures. Don’t assume that all of your women employees have certain issues now, but assess who does and who doesn’t need more support and resources from management and HR.
- Be prescriptive. Take what you learn through these listening tours and conversations, and use the information to shape new company policies and practices to support your entire workforce. Be intentional, measure your progress, and be sure that your updated offerings are directed not just to women but to any employee who may need them.
The bottom line is, we are better together—so let’s find ways to keep the women in our companies from leaving during this trying time.
Rebecca Shambaugh is President of SHAMBAUGH Leadership, and Founder of Women in Leadership and Learning. Rebecca is a contributing writer to Harvard Business Review, the HuffPost, and a TEDx speaker. Rebecca has been featured on CNBC, Forbes, Training Magazine, and US News and World Report. She is author of the best-selling books It’s Not a Glass Ceiling, It’s a Sticky Floor andMake Room for Her: Why Companies Need an Integrated Leadership Model to Achieve Extraordinary Results.
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