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The future of work for women - and how to get there

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160 million women may need to change jobs due to automation. Here's how companies can help them thrive. Image: REUTERS/Mohammad Shoib

Anu Madgavkar
Partner, McKinsey & Company
Vivian Hunt
Senior partner, McKinsey & Company
Lareina Yee
Senior Partner, McKinsey Technology Council
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SDG 05: Gender Equality

This article is part of: World Economic Forum Annual Meeting
  • As many as 160 million women may need to change jobs due to automation.
  • Companies that promote women are more profitable.
  • Failing to help women transition into tech could widen the gender gap.

The argument for supporting women to raise their skills in order to thrive in the labour markets of the future is compelling. Employers should pay particular attention to the needs of women who face new pressures from automation, on top of the perennial difficulties they already face in the world of work. McKinsey Global Institute predicts as many as 160 million may need to change jobs in the age of automation – nearly one-quarter of all women employed today.

The challenge is not so much who gets hit hardest by automation – the impact is roughly the same order of magnitude for women and men – but how well individuals are prepared to adapt. This is where women need targeted support.

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If women can make the necessary transitions, they could be on a path to more productive, higher-paid work. If the opportunity is not available to them, the gender pay gap may widen, and many women may even leave the labour force as demand for lower-skilled jobs declines. There has been progress, but it has been slow. Companies are promoting diversity but on the current trajectory it will take more than 20 years to reach parity in executive positions, according to the McKinsey Diversity Matters database. This progress could be derailed if women are not helped to make the transitions they need in the face of automation.

More women need occupational transitions by 2030 to remain employed. Image: McKinsey Global Institute

We know this matters. McKinsey’s research has found companies in the top quartile for diversity are 15-24% more likely to outperform their peers on earnings before interest and taxation (EBIT) margins than are companies in the bottom quartile. In UK and US data, we found companies with more than 30% women on their executive teams were almost 40% more likely to outperform on EBIT margins than those with 10- 30% women executives.

More than ever, men and women need to develop the skills that will be in demand, the mobility needed to negotiate labour-market transitions, and the access to, and knowledge of, the technology required to work with automated systems. Today, women face relative challenges across all three areas. We are arguing for tailored support from companies, supported by government policy, to enable women to overcome these barriers.

Let’s look at the three keys to the future of work for women:

1. Different and higher skills

The key arbiter of success or failure in making these transitions will be different and higher skills. In five of the six mature economies studied, we expect net demand for labour to be positive only for jobs requiring a college or advanced degree. In three of the four emerging economies studied, net labour demand for occupations requiring secondary education could rise sharply. MGI research in 2018 found that demand for basic cognitive, physical and manual skills will decline, but that jobs could require up to 55% more time using technical skills and 24% more hours using social and emotional skills by 2030. These substantial shifts in labour demand will require many women to make radical changes to their working lives.

Although the gender gap in education is narrowing, fewer women are graduating in fields that will grow and be vital for future employment. In the United Kingdom, only 37% of first-year full-time female students study science subjects, compared to 48% of men.

The private sector should invest more in reskilling employees, or partner with academic and other institutions. One study found that in 2018, 54% of employers were providing additional training and development opportunities to their existing workforce to fill skills gaps, compared with only 20% in 2014 – that share needs to rise further. Public and private investment in digital learning platforms would open up another avenue for women. In the United States, Disney’s Code: Rosie initiative recruits and trains women in non-technical positions for software engineering roles, offering 12-month apprenticeships and mentoring schemes.

How government, industry, education and NGO leaders can support job transitions for women Image: McKinsey
2. The opportunity to be mobile and move from one job to another

Women are less mobile than men because they disproportionately undertake unpaid care work in the home, compromising their scope for training and paid employment. Technology could give women new flexibility to work remotely – in the gig economy or in e-commerce – but companies need to expand the range of flexible working options. One 2018 survey of employers found that flexible or remote working options were only offered by 23% of employers. More access to professional networks would help women bolster their chances of moving into higher-paid occupations. For instance, Hilton has created Team Member Resource Groups networks for women and other under-represented groups of employees.

3. Access to technology and being tech-savvy enough to use it

Technology could be the breakthrough that women need, enabling them to work more flexibly in the gig economy. Yet women lag behind men in access to tech, skills and leadership. Globally, men are 33% more likely than women to have access to the internet, and women only account for 35% of STEM students in higher education. Fewer than 20% of tech workers are female in many mature economies. Only 1.4% of female workers have jobs developing, maintaining or operating ICT systems, compared with 5.5% of male workers, according to the OECD. Companies have a role to play, working with educational institutions to develop a broader pipeline of women going into tech fields. In Singapore, many firms have started sending staff members to SkillsFuture’s Digital Workplace programme. Germany-based software company SAP has set a target – and is measuring progress toward it – of having 30% of leadership positions filled by women by 2022.


What's the World Economic Forum doing about the gender gap?

Armed with knowledge of the transitions women will need to make, now is the time to step up efforts and help women overcome new challenges and old.

The public, private and third sectors need to work together to support women to make the transitions they need to thrive in the automation age. There are concrete, practical ways that companies can play their part: bolstering the pool of talent and fulfilling their commitment to diversity in their ranks. Better to invest now than lose progress made in diversity for companies, for society, and, of course, for women themselves as the automation age takes hold.

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Related topics:
Forum InstitutionalEconomic GrowthJobs and the Future of WorkEquity, Diversity and Inclusion
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