In a year that began with the swearing in of the first-ever Madam Vice President, there is a renewed sense of optimism around what women can achieve. Yet at the same time, gender equality is moving in the wrong direction for the first time in decades, according to strategic consulting firm McKinsey.
One in four women — and three out of four Black women — are thinking about downshifting or leaving their careers, citing lack of flexibility, feeling like they always need to be “on,” and heavier burdens at home due to the coronavirus pandemic.
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This is a challenging moment for benefits leaders as we seek to stem the tide, but a holistic approach to benefits can help move the needle on many of the societal issues driving this burnout. The need to engage employees with a platform of relevant solutions is more vital than ever.
Understanding intersecting challenges in a pandemic
We know financial hardships like student loans, promotion and pay gaps, and caregiving needs have a disproportionate effect on women, but the coronavirus pandemic has amplified these intersecting challenges.
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Women are picking additional housework and caregiving duties while working from home, according to McKinsey. They are adding up to 20 hours a week of additional work for mothers, the equivalent of an additional half-time job and one and a half times the amount as fathers. Meanwhile, at work, women reported they feel added pressure and continued bias regarding their performance and work/home life balance. In this context, it’s no wonder McKinsey found that women reported higher levels of stress, exhaustion, and burnout compared to men.
Workplace benefits, which can help alleviate some of these pressures, are also not equally available to women and minorities. The way equity compensation is administered can have an impact on workplace equality: A recent Shareworks by Morgan Stanley report found that just 41% of women participate in equity compensation plans, compared to 52% of men. Additionally, of those individuals who were granted equity in their compensation plan, only 25% were working mothers, compared to 60% of working fathers.
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Empowering employees
Here are a few ways to leverage your benefits suite to offer tangible support where it matters most:
- Mind the gaps: Pay careful attention to your human resources policies and practices. Are any groups disproportionately affected by job cuts, promotions, pay raises? Who is left out? According to McKinsey, only 85 women are promoted to manager for every 100 men — a ratio that falls to 58 for Black women and 71 for Latinas.How does your company compare?
- Hone holistic financial wellness: Consider how to leverage your benefits to address needs and fill gaps in support for women. For example, women owe much more student loan debt than men, carrying two-thirds of the nearly $1.6 trillion owed in the US even though they represent just 56% of college students, according to the American Association of University Women and BenefitsPro. Women of color carry a heavier burden on average: For example, Black and African American college graduates generally owe an average of $25,000 more in student loan debt than white college graduates, according to the National Center for Education Statistics.
- Personalize your offering. Women report greater difficulty in meeting basic living expenses, according to Newsweek. They also generally live longer than men, yet make and save less for retirement, according to CNBC. Benefits like financial counseling, a personalized employee experience, and financial wellness education can help women identify and sidestep these pitfalls in their individual financial journeys.
- Take advantage of current legislation: The CARES Act, passed in March 2020, contains provisions that remove tax barriers for employers and employees participating in student loan repayment benefits, much like a 401(k). Employers can make tax-free yearly contributions of up to $5,250 per employee for existing student debt, without increasing employee gross taxable income. Recent relief legislation extended these provisions to 2026, so now may be the time to consider expanding your current higher education benefits.
- Make equity equitable. The Morgan Stanley report found that, in addition to unequal access to equity compensation, even in the presence of equal base pay, equity plans can increase pre-existing disparities. Additionally, equity plan vesting schedules and their leave of absence policies were found to negatively impact women, who are more likely to take leave for new child or caregiving responsibilities. Take a clear, level look at how your company allocates equity to see whether there are opportunities to help close these gaps.
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Workplace benefits may not solve all of society’s problems, but they can have an enormous impact on your employees, their families, and their communities. There is so much potential. As The World Economic Forum reminded us in January, women’s equality is critical to the economy — in fact, gender parity would add $15 trillion to global GDP.
There is so much to gain by supporting women, above and beyond attracting, retaining, and motivating diverse talent. As women truly engage, thrive and contribute, you can achieve a better financial future both for your employees and your organization.
