Breaking up with business: why women leaders are walking away

Women who have worked long and hard to finally take their seat at the table are choosing to stand up and walk away from their leading roles. Not just a few women, and not just women in a certain industry (though a new study shows that women in STEM are leaving their jobs at twice the rate of women outside of the industry). We’re talking about women everywhere, and if you aren’t one of them, chances are you know one of them, because it’s happening at the highest rate in history. 

In its “Women in the Workplace” report, which surveyed 22,000 women and 18,000 men, Lean In and McKinsey & Company found the gap between women and men leaders leaving is the largest it has ever been. To put the scale of the problem in perspective, the data reveals that for every woman at the director level who gets promoted to the next level, two women directors are choosing to leave their company.

Despite some gains in representation over the last decade, women—and especially women of color—are still dramatically underrepresented in corporate America. Only 1 in 4 C-suite leaders is a woman, and only 1 in 20 is a woman of color. 

Only 1 in 4 C-suite leaders is a woman. Only 1 in 20 is a woman of color. 

The “great breakup”

Just look inward or talk to a close female confidant and you’ll realize that it’s increasingly important to women that they work for companies that prioritize career advancement, flexibility, employee well-being as well as diversity, equity and inclusion. It’s often these unmet expectations that are causing so many women to leave their companies in unprecedented numbers and seek out organizations that align with their needs and values. 

Lean In and McKinsey & Co. call this mass exodus “The Great Breakup,” but all things considered, DEI expert, CEO and Founder of Belong by Dawn Christian, Dawn Christian says the large number of women leaving top positions at companies across the country is best described as just plain heartbreaking. As she explains it, when women (and especially women of color) leave top company positions, they take their many talents and capabilities with them. Without women’s perspectives and diverse experiences, leadership becomes more stagnant which naturally widens the gender gap because homogenous leadership perpetuates systemic biases and discrimination. These built in blind spots cause business leaders to overlook their biases, limit opportunities for women, and create hostile work environments for the remaining female employees.

“In a healthy work environment that prioritizes a woman’s humanity as much as her hard skills on a resume, companies become more innovative because women want to be at work and feel supported in their mission to achieve professional excellence as they navigate their personal lives,” Christian explains.

Executive Director of Equal Rights Advocates Noreen Farrell, says several factors are driving senior-level women from their jobs at a record pace. The underlying theme is the pursuit of respect and equity. 

“They are leaving jobs where they are undervalued and leaving employers that don’t support time off for family care,” says Farrell. “Women are going to companies with more generous work from home options. And women facing roadblocks to progress and burnout are exploring new careers that are more fulfilling, with employers that value them more,” says Farrell. 

Stressed out workers say sayonara

With 44 percent of employees reporting experiencing a lot of daily stress in an average work day, working women in the U.S. are among the most stressed employees globally. More than a corporate wake-up call – it’s a corporate crisis. A whopping 40% of the C-suite say they will likely quit within the year because of work-related stress, according to a new Workforce Institute study. The solution — companies that (genuinely) prioritize creating a work culture that values and supports diversity, equity, belonging, and inclusion at all levels. What does this look like in action? 

“It looks like providing opportunities for professional growth and development, fair pay, flexible work arrangements, and a safe and inclusive work environment that values Ethos-Driven Leadership, which honors authenticity and supports women’s professional and personal leadership,” suggests Christian. 

A huge contributing factor to work-related stress, a lack of pay transparency continues to be a hot topic that’s finally gaining the attention and action of lawmakers in a handful of states. 

“A woman’s need for retirement security becomes amplified as she progresses in her professional life. Women are no longer satisfied just to have a job; they are demanding better jobs with higher pay. New state laws across the country are requiring the posting of salary ranges, says Farrell. “For women, knowledge is power.”

Between 2017 and 2018, the Institute for Women’s Policy Research conducted a national survey on pay transparency. At that time, about half of all workers and 60% in the private sector reported that they were either discouraged or prohibited from discussing wage and salary information.

“Since then, state after state has taken legislative steps to bar employers from implementing these speech restrictions, and the issue has reached wide audiences in the nation’s media,” said Washington University in St. Louis professor Jake Rosenfeld. “Yet we find their presence remains incredibly common, and that state-level efforts to facilitate transparency in the workplace have generally failed.”

Even in states with pay secrecy bans, nearly one in 10 workers is formally barred from discussing pay, Rosenfeld’s research found.

Women want flexibility. Why are companies pushing back?

Only one in 10 women wants to work mostly on-site. The report says that’s not just because of concerns like child care needs or commuting time: women working in the office are almost 1.5 times as likely to experience demeaning and othering microaggressions compared to when they work mostly remotely.

Nearly 20% of female leaders cited flexibility as a reason for switching jobs in the past two years, according to the Women in the Workplace data. Nearly half (49%) of female leaders said flexibility is one of the top three things they consider when deciding whether to join or stay with a company, compared to 34% of male leaders. It’s even more imperative for younger women, with 76% of women under 30 saying it has become more important to them in the last two years. 

While female leaders say they want to work for companies that prioritize flexible working, a growing number of companies remain resistant to reframing their structure to retain female talent. 

Major corporations continue to push back on flexible and remote policies, with many requiring full-time return to the office mandates despite employee sentiment. Most recently, Amazon issued a mandate for corporate staffers in a February memo, and Insider reports that Salesforce’s leadership has drafted a return-to-office policy that’s in the works. 

Increasingly, corporations are tracking attendance or threatening termination when workers don’t fall in line with in-office mandates. Some executives hold the beliefs that productivity exclusively rises when teams collaborate in-person and that changing standard practices would negatively impact their bottom line. However, this mentality has been proven to be based in false fear and is in direct contrast with the results of more than 30,000 US workers surveyed in May 2020, led by Jose Maria Barrero of the Mexico Autonomous Institute of Technology, Stanford’s Nicholas Bloom, and Chicago Booth’s Steven J. Davis. Analysis of the data collected through March 2021 found that nearly six out of 10 workers reported being more productive working from home than they expected to be, compared with 14 percent who said they got less done. “Three-quarters or more of the productivity gains that we find are coming from a reduction in commuting time,” says Davis. As the “great breakup” is now suggesting – some of these return-to-office mandates are backfiring with top talent leaving to seek out flexibility elsewhere. 

Women want balance

Women endure marginalization on multiple fronts, which impacts mental health, focus, and overall job satisfaction. Mothers are perceived to be 12.1% points less committed to their jobs than non-mothers, and beyond the implications of the social stigma, they’re financially punished for each child they have. Women face a 4% earning drop in hourly wages per child, whereas men receive a 6% wage increase for having children. Among full-time, year-round workers in 2020, moms were typically paid 74 cents for every dollar paid to fathers according to the National Women’s Law Center’s (NWLC) analysis of U.S. Census data, with women of color typically being paid even less. By expanding benefit offerings, companies can signal an authentic personal investment in employee wellness.

“Companies should expand benefits to address women’s lived experiences at all stages of their lives, including wellness programs that address women’s health issues, like addressing the mental impact of experiencing marginalization at work by creating women’s oriented mental health and well-being resources,” suggests Christian. 

Companies with benefits supporting women’s diverse experiences are proven to retain more of them. Consider biopharmaceutical company AbbVie, which introduced caregiver leave for US employees in 2022: four weeks of paid leave (and eight weeks of unpaid leave) in a 12-month period to care for a family member with a serious health condition.

“Companies should [also] be conscientious about having resources that provide women’s health screenings, addressing lactation, postpartum, menopause, fertility, caretaker, and paid leave policies, and honoring flexible work arrangements,” Christian adds.

This can look like providing clean, safe, and quiet spaces for nursing mothers and built-in paid time off to accommodate caretakers who need to assist a family member with medical appointments. Until considerations are made and policies are changed, many companies will continue to lose the battle to retain top female talent as women shift gears and seek out the ones that create real work-life balance.

Moving on (and up)

According to McKinsey, 81% of women who are allowed to choose their work arrangements report feeling happier and less likely to leave their jobs. Most also report feeling less burnout and having more opportunities to advance than those who do not have flexible options. Amidst the “Great Breakup” it might serve companies to consider that women aren’t giving up their seats to leave their industries altogether, but rather to go find a better, more inclusive table. 

Women aren’t giving up their seats to leave their industries altogether, but rather to go find a better, more inclusive table. 

“Recruiting and retaining women in the workplace requires flexible and empathetic leadership. Considering the significant advancements in technology today, there are no more excuses to ignore the call to create a more inclusive work environment,” adds Christian. 

Only about half of women who participated in the Women In The Workplace survey feel that their manager regularly encourages respectful behavior on the team, and less than half say their manager shows interest in their career and helps them manage their workload. If there’s any hope to reverse this senior leader leaving trend, the changes companies make must ensure current women on staff are properly promoted, supported, and rewarded for their contributions before they decide to walk away, too. 

“There is a new future of work, and women at senior levels are pursuing it. Companies seeking to retain top talent need to prioritize pay transparency and equity, clear promotion tracks, family care support, and flexible remote work options,” says Farrell.

Photo from Benjamin Child