America’s nationwide labor shortage is about to complete its second year. Over three million people are missing from the workforce since the start of the coronavirus pandemic, and many of them are women.
Despite slight progress in lower unemployment for women this past month, their overall employment rate has not completely returned to pre-pandemic levels, according to data from the Bureau of Labor Statistics. There are still 1.8 million women missing from the labor force.
According to Katica Roy, gender economist and CEO of Pipeline Equity, there are two ways to bring them back into the labor market.
"The first is a more equitable workforce — that is, beyond pay, equity of opportunity," Roy told Yahoo Finance Live (video above).
For example, Roy noted, women make up 58% of college graduates and 47% of the labor force, yet only account for 8% of Fortune 500 CEOs. She described this as a "gap in opportunity."
"The second piece is actually equitable skilling," Roy said. "We leaped forward five years in terms of digital acceleration since the beginning of the pandemic. So the jobs that existed at the beginning don't necessarily exist today. We need to skill women, in particular, into those jobs."
Representation of women in senior management roles has historically been very low.
According to research from McKinsey & Company, "for every 100 men who are promoted from entry-level roles to manager positions, only 87 women are promoted and only 82 women of color are promoted. As a result, men significantly outnumber women at the manager level, and women can never catch up. There are simply too few women to promote to senior leadership positions."
Additionally, women account for 48% of entry-level employees in the workforce versus just 26% of C-suite roles. They also run only 4.8% of the world’s largest businesses.
In the financial sector, the share of women directors on boards only increased by 6% between 2018 and 2021, according to Deloitte and Statista.
Within the tech sector, which has seen mass layoffs throughout 2022, women make up less than half of employees. They also earn about 60% less than the average salary offered to men, a number largely unchanged since 2018.
Yet, Roy said, "what actually happens is that women are the last hired, first fired. So while men make up the majority of the tech sector, if you look at the numbers of women — in particular, women of color, Black women, and Latinas — they are most likely to be affected in terms of the layoffs. And the impact is even bigger because they make up such a small percentage of the tech labor force."
The effects of pay transparency
Research from the World Economic Forum's Gender Gap Index shows that at the current rate, the gender pay gap in the U.S. won't close for another 208 years.
And while pay transparency isn't the sole solution to creating an equitable workforce, it's a step in the right direction, according to Roy.
"It provides guardrails in terms of being more transparent about what a job pays," Roy said.
Many U.S. cities and states have adopted wage transparency laws, requiring employers to disclose the pay or salary range of a job either in the job description or during the interview stage. This often helps employees and job candidates identify pay disparities, leading to less bias in the job market.
Still, pay transparency does not guarantee pay equity, as seen in many male-dominated occupations such as construction and maintenance services.
“It is too early to tell whether it has been successful but what we know about pay transparency is that it is a first step — it is not the solution," Roy said.
Tanya is a data reporter at Yahoo Finance. You can follow her on Twitter @tanyakaushal00.