Why the Pandemic Has Been Bad for Females in Finance
Females in finance face new challenges.
Covid-19 has shaken up plenty of careers. It’s a stressful time for many. But the reality is the pandemic has amplified already-existing market distortions. Some are being more impacted than others. And within that group, women have been notably disproportionately impacted.
In the US, people lost 10 million roles since the start of the pandemic. Within those numbers, women account for around 1 million more of those losses than men. Recent job data for December saw roles increase for men, while women lost a further 140,000 posts. Much of this can be down to the fact that women account for a larger percentage of workers within the hospitality sector.
The voice of a politician
Senator Elizabeth Warren recently highlighted the structural issues that mean women losing their jobs because of the pandemic are likely to “lifetime consequences” unless they are given more help.
As Warren put it: “The pandemic has really set women back. And make no mistake, this is not something women are going to recover from in just the space of a few months or even a few years. This will have lifetime consequences.”
She added: “Women are getting hit in every direction. Low-income women and moderate-income women, have suffered from greater layoffs, they’ve struggled with childcare, so that they can’t get to work and, therefore ended up with more job loss.”
During the campaign for the Democrat Party nomination for the US presidential election, Ms Warren had backed universal childcare, to help women in the workplace. She returned to that idea more recently, when she said the way women were being hit by job losses now would last into their later careers, and even retirement.
“That’s the nature of the problem. What we need to focus on is real structural solutions,” she said. “First one, we need universal childcare in this country. We need to join the other high-income nations that make a real investment in letting parents work or letting parents finish their education.”
She added: “We also need to raise the wages of every childcare worker and preschool teacher in America. That’s one way that we can help women.”
The sad truth
Low and semi-skilled roles are not the full story. That would suggest that women in more highly-paid roles get the same opportunities and salaries as their male counterparties. There’s plenty of evidence to show that’s clearly not the case.
Women are working longer hours and pursuing higher education in greater numbers. However, despite this progress, significant wage gaps between men and women persist. And don’t forget the US passed the Equal Pay Act more than 50 years ago. In 2018, a woman working full time earned 81.6 cents for every dollar a man working full time earned on average. Additionally, women’s median annual earnings were $9,766 less than men’s, according to data from the US Census Bureau.
Beyond explicit decisions to pay women less than men, employers may discriminate in pay when they rely on prior salary history in hiring and compensation decisions. This can enable pay decisions that could have been influenced by discrimination to follow women from job to job.
What about females in finance?
Don’t expect the finance industry to be any different.
Although females in finance make up 56% of all American workers in the sector, the industry sees the second-largest gender wage gap, according to the ADP Research Institute’s ‘State of the Workforce Report: Pay, Promotions and Retention’.
The average hourly wage for male workers is $40, while the average rate for female workers is only $27 per hour. As a whole, the industry has an average wage of just under $33 per hour. Turnover rates for both women and men in the finance sector are equal at 2.2% per month. In addition, men in this sector have a slight advantage over women in receiving promotions and are more likely to have larger pay increases as they move up the career ladder.
Covid-19 has escalated changes in the industry. We are yet to see the full scale of job losses in finance. But structural issues persist in the sector regardless.
So in order to remain relevant, be ready and willing to highlight your accomplishments in earnest, negotiate hard for pay raises, and continue the upskilling process. We should all be doing it anyway. Unfortunately, some may have to do it more than others.
