Creating more opportunities for remote and highly flexible work is essential—but companies must avoid common pitfalls.
We are facing a gender equality crisis. The numbers have made for a steady string of headlines recently: We hit a 33-year low in women’s labor participation in January, and nearly 3 million women have dropped out of the workforce compared to a year ago. Since February 2020, women have lost a net of 5.4 million jobs, accounting for 55% of net job loss in the U.S. during this crisis, despite making up slightly less than half of the workforce. On a net basis, all 140,000 jobs lost in December 2020 in the U.S. belonged to women, and 2.2 million women have left the workforce entirely. Especially impacted are women of color, who comprise a large portion of the workforce in industries that have been hardest hit by the pandemic, including hospitality, education, and retail.
In the short-term, unpaid bills are piling up and pushing many women into poverty; in the long-term, financial hardship is hampering women’s wealth accumulation, stalling progress on economic freedom, which in turn will impact economic growth. On the business side, diminished gender diversity will harm organizations’ bottom lines. McKinsey research has repeatedly shown the link between low gender diversity and underperformance.
Reversing this troubling trend and continuing to build women’s contribution to the workforce must begin with organizations redoubling their efforts to diversify their own workforces. One key strategy employers can use to do so is expand access to flexible work. Flexible work offerings can help employees struggling with domestic labor, regardless of gender. Broad access to these working arrangements can encourage households to more equally distribute the burden of domestic work, and ultimately relieve women, who are currently more likely to drop out of the workforce due to family obligations.
The details matter though, and a poorly designed flexible work program can reinforce some persistent disadvantages for women in the workforce. At the same time, employers must offer flexible work or risk a severe talent drain. Research we’ve done at Mercer in partnership with AECOM showed that 56% of workers would try to switch jobs if their employers do not retain flexible work after the pandemic. To avoid either of those dire outcomes, organizations must carefully consider the potential pitfalls of flexible work, and build cultures and policies that make these new working arrangements successful.
Flexible work can create a level playing field for people who carry greater care obligations at home. But in practice, managers have a history of valuing work done in the office more highly than remote work. Our research has shown that before the pandemic, about 44% of managers felt this way about remote work. It’s very likely that with the experience of the pandemic, more managers recognize the full value of remote work. But organizations must address the concern that women who choose to work remotely at least part of the time may see their careers suffer as a result—and prevent that outcome.
Organizations seeking to expand their flexible work options without disadvantaging women in their workforces should follow three broad strategies to avoid potential pitfalls:
MAINTAIN OPPORTUNITIES FOR ENGAGEMENT
More women working outside of the office at least part-time may deprive them of a key asset for career building: workplace connections and mentorships. If managers and leaders aren’t able to provide resources for individuals while they are working from home, it will further erode opportunities for these groups.
Employers can find ways to ensure that flexible work doesn’t lead to diminished opportunities to make lasting connections and engage with mentors. After all, internal connectivity has generally not suffered during the pandemic: More than 80% of organizations have reported that their engagement level is at least consistent with what they experienced before the pandemic.
Supporting those with flexible work arrangements will require carrying forward some of the practices that helped employers maintain engagement over the past year. This includes virtual social events for both remote and on-site workers, and mentorship programs that cross the flexible work/office work line.
ENSURE REMOTE WORK IS RECOGNIZED
Organizations that increase their flexible work offerings need to foster a mindset shift among managers when it comes to the value of remote work. HR leaders can educate managers on the facts about remote work productivity, drawing on the pandemic as a lesson, including that 90% of employers have found that productivity has either stayed the same or increased between March and October 2020.
Employers should strongly encourage managers to carve out facetime with remote workers to ensure that remote work is productive and aligned, but managers should model new flexible work practices as well to avoid implicitly signaling a bias toward in-office work.
Organizations also need to consider redesigning performance and career management processes to ensure that any such bias doesn’t impact flexible workers, and continue monitoring and comparing outcomes between flexible workers and full-time office workers. This requires adopting processes that rely more on results and less on observation. For some positions, metrics that allow for quantifiable performance review already exist, like customer satisfaction scores for customer service jobs. For others, managers need to create and actively manage goals that employees can be measured against. Once a standardized process is in place, managers can compare results and more objectively measure the performance of flexible workers.
BE OPEN TO DIFFERENT KINDS OF FLEXIBILITY
Of course, while remote work and flexible work have both gained greater acceptance over the past year, not all segments of the workforce enjoy the same access to this flexibility. Roles like frontline work, and sectors such as healthcare, don’t enable much—if any—flexibility on where and when employees can perform their jobs. As some of these roles and sectors disproportionately employ women, greater economy-wide flexibility for those who can work from home could actually increase gender inequality.
While it’s true that not every employer can offer remote work, all can improve their flexibility. Employers can offer flexibility in when their employees work, how they work, and what work they do. Organizations need to identify what opportunities exist in their own workplace, and what version of flexibility offers the most help to their employees.
In 2019, women’s labor participation rate was just shy of an all-time high. Women had made significant progress in share of managerial roles. Women’s poverty rates were falling. To return to that trend and draw women back into the workforce, retain talent that is demanding more options in the workplace, and boost corporate performance through gender diversity, organizations must embrace the many lessons of flexible work that we have learned over the course of the pandemic.
by Martine Ferland
“My biggest mistake is not recognizing the power of compounding and the ability for it to build wealth, and therefore, not investing early enough,” she says. “To me, if there is one thing that can change our society, our economy, and the world, it is getting more money in the hands of women.
Indigenous Americans make up less than 1% of board members for major, publicly traded businesses, according to DiversIQ analysis. Only five people among the 5,537 board members for the S&P 500 identify as fully or partially American Indian or Alaska Native.
These three questions can not only play a pivotal role in strengthening an organization’s DEI culture; they can also serve as team-building exercise. The process of evaluating one’s understanding of DEI principles promotes open discussions, knowledge sharing, and alignment within the team.