[APRIL 2016 COMP ALERT] Why So Many 30-something Women Are Leaving Their Employer

We argued in our February Compensation Alert eNewsletter that hiring and paying women was not only the right course, but data and common sense reasoning suggest that it’s simply good business. To underline that topic, this month’s Compensation Alert summarizes a survey reported in the Harvard Business Review regarding why women in their early 30s are leaving their companies.

Organization leaders report that women are leaving primarily because of flexibility needs and family demands. Women in their 30s disagree.

A recent global survey by ICEDR revealed that leaders believe that the majority of women around the age of 30 leave because they are struggling to balance work and life or planning to have children. Whereas men leave because of compensation. However, according to women themselves–and in sharp contrast to the perceptions of their leaders, the primary factor influencing a woman’s decision to leave an organization is pay. In fact, women are actually more likely to leave because of compensation than men.

To underline the desire for fair pay for women, a survey conducted by Crain’s Chicago Business and an executive women’s group, the Chicago network found what women consider most important deciding whether to stay or leave a job is pay.

Not only are women’s reasons for leaving misunderstood, differences between women and men are overstated. The four top reasons 30-something women and men leave organizations are identical, if in a different order.

The survey research comes down to two simple findings. First, women care about pay. Second, women and men leave organizations for similar reasons. Based on these two conclusions, here are several actions that organizations can take:

Do your homework: Analyze job titles and grades or levels with significant populations of both men and women. Determine if there is a bias.  If there is, develop a data-driven plan based on your findings.

Ask, don’t assume: Instead of talking about women’s needs, talk with them. Ask women what are their needs and wants. Then develop a plan to address the results of the study.

Address challenges beyond family and flexibility: While options for flexibility and work-life balance are important, the bottom line is that motherhood is not the primary reason that talented women are leaving organizations. Focusing retention strategies on this alone, without also considering pay and compensation fairness, will ultimately jeopardize retention and advancement efforts.

Propose women’s strategies as broader talent strategies: It is good news for organization leaders that gender appears to have little impact on an individual’s reasons for leaving an organization. There is less a need to segment and complicate talent strategies by gender. Instead, create strategies that address the desires of both women and men.

There is a disconnect between current talent retention strategies and the desires of top female talent. While work-life balance, flexibility and family are important, they are not the only–or even primary–reasons women leave companies. With men and women expressing common concerns about why they leave jobs, leaders have the opportunity to retain and advance top talent, both male and female, by focusing on common priorities: pay and fair compensation.

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We welcome your feedback on our Compensation Alert eNewsletters. Please contact me at (847) 864-8979 or nlappley@lappley.com to discuss gender compensation issues or other topics of interest.