The global tech and financial services industries have been led by men for decades. In the tech sector, only 25% of workers are women. And, only 9% Black. While Latinx workers make up 7%.
In the community of fintech founders, only 7% are women. These numbers reveal the strides still needed towards attaining diversity in the technology and financial sectors.
Some companies have made deliberate efforts to hire more women. But, evidence shows the attrition rates for women is 2x that of men.
One reason, according to a research by Deloitte, is the need to leave work to raise a family. Other reasons can include a lack of sponsors, few role models.
Whatever the reason, the impact to the business is the loss of valuable, mid-career talent that has negative impacts on culture and sources of innovation.
Resilience of women
Despite the few numbers of women in the sector and the limited opportunities given, women have managed to create and steer a number of notable startups.
Greater representation will certainly lead to more similar stories because there are many unmet needs in financial services and tech where solutions are needed.
Fortunately, according to numbers published by Deloitte, significantly more funding is now going to women-led startups compared to a decade ago.
In 2019, such startups raised $5.1 billion. For comparison, such startups raised $8.5 billion total for the time between 2009 and 2018.
Startups founded by women alone raised $540 million in 2019. This amount was $85 million in 2015, representing a six-fold growth in just 4 years.
While the total amount is growing, the bigger challenge is to have a higher number of women-led and under-represented groups’ projects get funded.
Strategies to create more opportunities
According to Deloitte, the challenges that lead to women being under-represented in tech can be overcome through a set of comprehensive strategies to recruit and retain talent, and help women and other under-represented groups achieve senior roles.
The single biggest barrier for women seeking advancement in their careers is gender bias. 3 out of every 4 women working in the sector have faced some form of discrimination based on gender.
As a result, Deloitte recommends a strategy for the business to create a culture that safe guards against bias by making it easier for women and other under-represented groups to report such incidences, and communication and action at all levels making it clear the business does not condone discrimination.
Discovering new sources of talent
One challenge facing the tech sector is intense competition for a limited pool of talent. As such, innovative companies are working to get more women into the workforce pipeline.
Microsoft, for example, recognizes this challenge and has extended its reach to universities and colleges with an attempt to get women and minorities excited about STEM programs.
And, Microsoft has tapped into talent pools from non-traditional channels. These include veterans, people with autism, and people seeking to pivot from other careers.
This long-term strategy seeks to benefit not just these innovators, but the entire sector.
Some companies are offering ‘returnship’ programs as a way of offering re-entry paths for people who had left the workforce.
These programs are a great way for companies to show that they recognize that people may need to leave the workforce to attend to important duties like raising a family or taking care of a terminally ill family member and then return to work when the time is right.
The value of diversity and inclusivity
Retaining the best talent is important for tech companies. According to Deloitte, inclusivity is key to retaining a talented and diverse workforce.
Companies that create a diverse and inclusive workplace attract and retain top talent. And, they are more innovative and adaptable, which is valuable to the business and its stakeholders.
Research shows that companies with diverse management teams achieve margins that are almost 10% higher, on average, than companies with below-average diversity.
And, companies with above-average diversity generate more revenue from innovation than from companies with below average diversity.
Workplace diversity increases understanding and acceptance. It also increases the value placed on differences between people of different gender, race, ethnicity, age, religion, ability, and orientations.
In a study involving women who had risen to senior roles in the technology industry, two factors emerged as important motivators for them to stay more than 8 years in their jobs:
- Fair compensation
- Work-life balance
The word ‘fair’ is important in this context. It means that these women were compensated in a way that made them feel as important as their male counterparts.
41% of respondents cited fair compensation. And, another 39% cited work-life balance.
More productivity and fewer headaches
Cultivating an inclusive environment within a business is key to productivity. Employees have higher motivation when they feel like members of the group. And, that they’ll be evaluated fairly.
As a result, they are much more likely to set targets that align with the overall organizational goals.
Further, healthy environments foster more productive exchanges between employees.
These factors are important in boosting job satisfaction, improving learning, reducing internal conflict and unhealthy internal competition, and promoting employee retention.
Innovation is incredibly important in the financial services and technology industries. And, people with different backgrounds enriches the sources of new ideas within a business.
Different points of view lead to more ideas to solve problems and, ultimately, to better solutions.
A company can gain an edge over its competitors by cultivating a reputation for a diverse and inclusive culture.
How a business attracts, empowers, supports, retains, and leverages a diverse workforce are parts of its diversity, equity and inclusion (DE&I) strategy.
Don’t overlook contingent workers
Many companies overlook a large and growing part of the workforce in their business.
Contingent workers, or contractors, can be between 30% – 50% of all workers for a typical company.
The numbers can be even higher for functional areas like customer service and deliveries, and for workers in the supply chain like seasonal workers.
These workers often ‘fly under the radar’ when it comes to a company’s DE&I strategy and, as a source of potential talent.
For more about the contingent workforce in your value chain check out this post – The Contingent Workforce Should be Part of Your Business’s D&I Strategy