In an effort to prioritize inclusion, organizations should be looking at gender gaps in leadership positions while also providing a culture that encourages not only leadership, but also entrepreneurship itself.
Despite decades of gradual progress, there remains a gender gap in leadership positions across industries. Women are, by and large, disproportionately underrepresented at senior levels — particularly in the C-suite — and there are far fewer women entrepreneurs than male business owners. In fact, just 20.9% of all businesses are owned by women, as reported by the U.S. Census Bureau.
The pay gap isn't the only gap
"As a woman ages, the [pay] gap becomes wider," says Nela Richardson, Chief Economist at ADP, at the virtual summit Women@Work 2022. "So by the time [they] reach 55 and older, the typical woman is making 75% of what a man makes."
Analysts at McKinsey and other firms are quick to offer advice to corporate leaders on how to repair and restore women's access to social capital in support of their career advancement. Addressing gender pay gaps may be the simplest step employers can take to better support working women. Pay equity at the time of hire is essential, of course, but organizations must pay more attention over time.
But emerging research also suggests a growing gender aspiration gap is keeping women out of leadership positions and affecting the number of women-owned businesses. Tired stereotypes argue that women are, by nature, less ambitious and entrepreneurial than their male counterparts, but that's a drastic oversimplification designed to excuse business leaders from taking responsibility for the number of women in leadership.
A nuanced perspective of this issue is offered from a leader in the field of female entrepreneurship, Cate Luzio, founder and CEO of Luminary: Luzio says, "Speaking specifically to entrepreneurship, pre-pandemic, more than 1,800 new businesses were started each day by women. In 2021, over 50% of all new businesses in the US were started by women, representing a 28% increase since 2019." But here's the nuance. "Despite these metrics, women entrepreneurs still have less access to capital, resources and mentorship than their male counterparts," Luzio explains.
It's time for meaningful change
Women should be empowered to nurture their entrepreneurial aspirations within the traditional corporate structure. Fostering this type of a culture can be an effective strategy for supporting women throughout their careers. But it relies on an organization's ability to encourage experimentation, accept (or even celebrate) mistakes and facilitate networking and learning opportunities — all without formal or informal penalties.
Consider women's entrepreneurial interests and provide purposeful support – even if that's outside your organization. This could take the form of providing grants or time off for side hustles, more flexible work schedules to foster autonomy or a shift to deliverable-oriented performance structures.
Supporting women at all levels of your organization helps to ensure that you're not wasting the talent you've invested in. Retaining and promoting more women as part of larger diversity and inclusion efforts helps foster business agility; and gender equity in leadership roles has consistently been linked with higher levels of profitability, employee engagement and even innovation. By taking responsibility for women's career and leadership progression, you can affect meaningful change not only for women, but for your organization and community as a whole.
Helping women of color-owned businesses GROW their companies
In partnership with Luminary, a global professional growth platform and collaboration hub for women, we're pleased to announce the ADP x Luminary Fellowship Program, supporting businesses owned or founded awarding a total of 100 fellowships, with at least 75% awarded to women of color.
"Programs like this are not only necessary, but essential for women business owners," says Luzio. "This partnership broadens our ability to help businesses owned by women and women of color with access to Luminary's resources and community but also the support and tools ADP delivers to small businesses. This access can help lead to both sustainability and profitability for these Fellows."
Luminary's Fellowship programs deliver access to their extensive global community, introductions, workshops, coaching, mentoring, and business marketplace for growth. With more than 700,000 small business clients, Fellows will receive best-in-class thought leadership and insights from ADP, including access to the ADP small business platform.
Are you a woman of color and own a business?
Visit the site to learn more about this fellowship, share with others who could benefit and apply today!