white paper - gender diversity in stem us report

White PaperCEB TalentNeuron™

Gender Diversity in STEMCEB TalentNeuronTM US Report

Executive SummaryWomen constitute approximately 46% of the civilian labor force in the United States, but only 26% of the labor force in science, technology, engineering, and mathematics (STEM) occupations. As of 2014, still only about 25 out of 500 CEOs (5.2%) were women.

The lack of women in STEM means companies are missing out on potential business gains, as the effects of having women in the leadership ranks are simple and undeniable:

■ Fortune 1000 companies receive a 103.4% average return during the tenure of women CEOs, compared to a 69.5% average return over the same period for the S&P 500 Index.1

■ Credit Suisse found that companies with one or more women on the board saw a 16% average return on equity (ROE) in the study period (2005–2011), compared to 12% average ROE for companies without female board members.2

■ McKinsey research showed that companies with top-quartile representation of women in executive committees have, on average, 47% higher ROE and 55% higher earnings before interest and tax (EBIT).3

■ A start-up company’s odds for success increase with more female executives at the VP and director levels.4

New graduates entering the workforce will not close this existing gender gap. Only about 18% of women take STEM courses at the university level, and they show far greater likelihood than men of moving to non-STEM careers later. According to our modeling projections, these metrics are unlikely to change in the next 15 years unless companies make concerted action and steps toward changing the status quo.

This paper provides a more structured approach to bridging the gender diversity gap by exploring evidence and raising critical point of views. It also describes some ways leading companies are working to build a culture of gender diversity and removing barriers to women in STEM careers—and what CEB is doing to help.

1 Fortune, July 2014; CEB analysis.2 Credit Suisse, 2013; CEB analysis.3 McKinsey, 2010; CEB analysis.4 Dow Jones and Company, 2012; CEB analysis.

© 2016 CEB. All rights reserved. TMI5321216SYN Detail about CEB Inc. and its subsidiaries can be found at cebglobal.com/offices.

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Contents

What Executives Say About Diversity 4

Why Diversity Is Important 5

Where Do We Stand on Gender Diversity in STEM Today? 5

Women in Leadership 7

What Does the Future Hold? 9

How Organizations Can Build Gender Diversity 10

Closing Thoughts 12

About CEB 12

About CEB TalentNeuronTM 12


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This study may not be reproduced or redistributed without the expressed permission of CEB. GENDER DIVERSITY IN STEM



What Executives Say About DiversityFortune 100 financial services firm: “After the financial crisis, we recognized that to be successful we would need a more globally relevant business strategy—but we couldn’t do that without improving the diversity and inclusion of our talent globally.”

Global 100 oil and gas company: “We know inclusion drives business performance, and it is our mission to articulate that reality as compellingly as possible.”

Fortune 250 food processing company: “Inclusion is the most important catalyst for employee engagement, and businesses’ success or failure hinges on their ability to engage and motivate talent.”

Global 300 telecommunications provider: “To retain the talent that will help our business succeed, we must be able to create a workplace that cultivates diverse perspectives.”

Fortune 250 insurance firm: “Companies’ diversity and inclusion are now in the public eye—people are paying attention. To win the market, we must be able to articulate our commitment to making progress.”

We’ve heard these sentiments time and again when interviewing more than 60 diversity and inclusion executives at the world’s largest companies. They have called diversity a boon for recruiting, retention, engagement, public goodwill, and, of course, business performance. The issue is gaining broader awareness—and not just from a compliance perspective. Said one executive: “Our CEO has prioritized diversity and inclusion as a business issue. We are finally beginning to see this issue elevated beyond HR.”

“Enabling women to advance to senior leadership positions in our firm is key to our growth. We can’t progress if STEM careers remain insulated from diverse perspectives.”Global 500 IT Company


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Why Diversity Is ImportantYes, employees are happier at an inclusive workplace, but independent research shows that gender diversity is not largely a compliance play or a feel-good concept with only indirect value—even the feel-good aspects have tangible value. Our employee performance studies show that “working in a diverse team” ranks among the workplace’s top five most important drivers of employee engagement and discretionary effort.

Employees don’t just value working with different people—they actually perform better in diverse environments. They work 12% harder, have 19% higher likelihood of staying longer with the organization, and collaborate up to 57% more effectively with peers.5 Moreover, female perspectives can adeptly anticipate customer demands and avoid blind spots in understanding customer relationships. These skills translate into massive returns; companies with diverse leadership generate twice the revenue and profit growth as those without.

Although 77% of executives strongly support diversity initiatives and organizations expect to build up their diversity investments over the coming years, workers across the globe continue to see those efforts as ineffective. A clear business case exists for equal opportunities and maximum workforce diversity—but turning the ideal into reality is far from easy.

Where Do We Stand on Gender Diversity in STEM Today? Women compose approximately 46% of the civilian labor force in the United States, but they only make up 26% of the STEM labor force. It should be noted that the total number of professionals in STEM fields (7,340,644) represents only 6% of the employed population, with the vast majority of them (6,011,987) in computer science and engineering.

5 Jean Martin, “Keeping Diversity and Inclusion at the Top of the Agenda,” Changeboard, 7 December 2015, http://www.changeboard.com/content/5387/diversity-and-inclusion-needs-to-remain-a-priority/.


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http://www.changeboard.com/content/5387/diversity-and-inclusion-needs-to-remain-a-priority/



Gender Diversity: STEM OccupationsOverall Gender Distribution in STEM Occupations

Gender Distribution Across Different STEM Streams

74% Male

26% Female

Engineering Occupations

Computer Occupations

Life and Physical Science

Occupations

Mathematical Occupations

Social Science Occupations

0% 50% 100%

87%

73%

59%

53%

39%

41%

47%

61%

27%

13%

Looking closer at this population, it is clear that although women only make up one out of every four STEM workers on average, the gender gap is widest in the most prominent industry areas. Women represent only 26.2% of the workforce in computer science and 13.2% in engineering. The gender gap is less pronounced in other STEM areas; women make up 40.9% of the workforce in physical and life sciences, 47% in mathematical occupations and 61% in social science.

Naturally, variance occurs within these broad categories. In certain engineering disciplines, for instance, the gender gap is huge. Women represent only 8.1% of the agricultural engineering workforce, 7.8% in surveying and mapping, 6.7% in mining and geological engineering, and only 6.3% in mechanical engineering.

Women see better representation in computing professions, such as database administrators (40.1%), web developers (37%), and systems analysts (35.3), but they still make up less than 20% of network and computer system administrators and only 11% of computer network architects.

Moving into physical and life sciences, women are well represented and sometimes even outnumber men (e.g., medical/life sciences and social sciences). Seven out of 10 psychologists and six out of 10 sociologists are women.

Source: CEB analysis.


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Women in LeadershipThe presence of women at the top of the enterprise is slowly increasing, but by 2014 still only about 25 out of 500 CEOs were women (5.2%).6 In the largest companies (FTSE 100), women hold just 16.9% of board seats and only 14.9% of CEO positions.7

Gender-Balanced Leadership Is Still an Elusive Quest

Slow Increases in Female CEOs Over TimePercentage of Fortune 500 CEOs

0.40.8

1.2 1.4 1.6 1.8 22.4 2.4

3 32.4

3.64

5.2

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0

3

6

Source: “Women CEOs of the Fortune 1000,” Catalyst.org, 7 November 2014, http://www.catalyst.org/knowledge/women-ceos-fortune-1000; “Fortune 500 CEO Positions Held by Women,” Catalyst.org, 23 June 2014, http://www.catalyst.org/knowledge/fortune-500-ceo-positions-held-women.

“While women continue to outpace men in educational achievements, we have ceased making real progress at the top of any industry,” wrote Sheryl Sandberg, author of Lean In: Women, Work, and the Will to Lead.8

“We really lose our women at the senior director level,” according to a chief diversity officer. “It’s like they hit a barrier and can’t get past it into leadership.”

Conventional wisdom blames a “glass ceiling” for the lack of women in corporate leadership. This unseen barrier supposedly prevents diverse talent from reaching the upper rungs of the corporate ladder, regardless of qualifications or achievements.

However, our research found otherwise. Attrition in the female talent pool occurs throughout the career ladder and is actually more acute at the lower levels. More than half of women in entry-level and mid-level non-management positions leave the talent pool. So do 40% of first–and mid-level managers, 32% of women in department head and general manager positions, and 21% of top executives.9

6 “Women CEOs of the Fortune 1000,” Catalyst.org, 7 November 2014, http://www.catalyst.org/knowledge/women-ceos-fortune-1000; “Fortune 500 CEO Positions Held by Women,” Catalyst.org, 23 June 2014, http://www.catalyst.org/knowledge/fortune-500-ceo-positions-held-women.

7 “Catalyst: 2013 Saw No Gains for Women,” GlassCeiling.com, 13 December 2013, http://www.glassceiling.com/catalyst-2013-saw-no-gains-for-women/.

8 Sheryl Sandberg, Lean In: Women, Work, and the Will to Lead (New York: Knopf, 2014).9 CEB Q1–Q3 2014 Global Labor Market Survey, n = 43,350.


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These factors lead to a gradual erosion of gender diversity over time.

How can we mitigate this loss of talent throughout women’s careers? And how can we enable and encourage women to move from junior and mid-level roles like analysts to more complex and senior roles like data scientists? These questions reveal the core of the problem. Women fill anywhere from 15% to 50% of junior and mid-level roles as the total number of females in senior-level and complex roles (such as data scientists, data architects, senior software engineers, and cloud engineers) drops below 15%.

Unbundling Job Descriptions Can Improve Gender Diversity

Percentage Range of Females in STEM Roles

5% 15% 30% 50%

Key question to address: How can we enable women to move from junior and mid-level roles to senior roles (e.g., from analysts to statisticians to data scientists)?

Data scientists, data architects, senior data

architects, senior software engineers,

cloud engineers

System administrators, product managers, mobile developers,

infosystem managers, information analysts

.Net developers, web developers, UI/UX developers, system software developers, data analysts, statisticians,

operations research analysts, database administrators

Proportion of females in senior-level roles is below

15%.

Proportion of females in junior to mid-level roles is between 15%–50%.

Source: CEB analysis.


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What Does the Future Hold?Will new university talent be enough to fix this issue? Approximately 18% of women take STEM courses at the university level, and in 2015, 333,000 women graduated with STEM degrees.

However, university women have the lowest participation in engineering and computer science courses, which is precisely where the gender gap is widest. There’s also no guarantee that graduates will pursue careers within their chosen degree. More women than men move to non-STEM careers after studying STEM courses. This is proven among math majors: 50% of women who studied mathematics moved on to non-STEM careers. The difference is even wider for engineering, where 54% of women move to non-STEM careers, compared to 48% of men. But computer science’s disparity is among the largest, with 55% of women moving to non-STEM careers, compared to 40% of men.

Some students may move within STEM course paths, but negligible transitions happen from non-STEM educations into STEM careers. Only 3.6% of females from non-STEM university programs, for example, move into computer science professions. Based on averages from the current forecast scenario, half the number of women as men will join STEM jobs from the graduate population over the next 15 years.

CEB TalentNeuronTM: Predictive Models for STEM Jobs

Based on the current forecast scenario, on average, half the number of women as men will join STEM jobs from the graduate population over the next 15 years.

Male Forecast Female Forecast

250,000 250,000

200,000 200,000

150,000 150,000

100,000 100,000

50,000 50,000

0 0

Num

ber

of

Mal

e G

rad

uate

s

Join

ing

ST

EM

Jo

bs

Num

ber

of

Fem

ale

Gra

dua

tes

Jo

inin

g S

TE

M J

ob

s

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

203

0

Mathematics Social Science

Life and Physical Science Engineering

Computer Science

Mathematics Social Science

Life and Physical Science Engineering

Computer Science

Source: www.census.org, https://nces.ed.gov/; CEB analysis.

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

203

0


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How Organizations Can Build Gender DiversityProgressive companies have embraced several approaches to encourage women to move into technology roles.

■ Flexible work schedules: We surveyed more than 1,400 female leaders with management responsibilities ranging from entry-level managers to CEOs, and 25% named flexible time schedules (which can include staggered hours within a fixed schedule, a variable day schedule, longer midday breaks, compressed work schedules, etc.) as by far the most effective tool in helping their careers.

Employees want the capability of adjusting their schedules to accommodate sick children, care giving responsibility for older adults, and school vacations and closures, among other scenarios. The vast majority (86%) of companies on Fortune’s 100 Best Companies to Work for in 2014 offer some type of flexible schedule.

■ Changes in recruitment policies: Companies are establishing recruitment goals for women and building relationships with career advisory services to actualize these targets. Some have stepped up their recruiting activity at schools with a high proportion of female students, as well as schools that offer sponsorships and internships to select female students. Other organizations offer employee incentives for referring qualified female candidates for job postings.

The most successful recruiting approaches recognize that women may have different motivations and needs than their male counterparts—and each other. There’s no one-size-fits-all strategy. It is important to align brand, recruitment, and development approaches more closely with the preferences and needs of female employees, while at the same time reducing bias in recruitment and talent management decisions.

■ Post-maternity benefits: To attract women employees back to work after having a child, companies are setting up on-site childcare centers and offering relearning programs and internships to provide an accelerated process for women to return to work as easily as possible.

■ Creating a pipeline of future women leaders: Leading companies collaborate with community colleges and universities to prepare women for STEM roles, and they encourage influential women female leaders to act as role models or mentors, sharing their career experiences and journeys. In an interesting twist, Facebook, Pinterest, and Box have launched WEST (Women Entering and Staying in Tech), a program to collaboratively provide one-on-one mentoring to help women step into technical roles.


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Flexible Schedules Highly Effective for Career Progression

Aspiring Women Leaders’ Desired Workplace Accommodations Percentage of Women Leaders Who Chose the Following Items When Asked “What Would Help Women Most in Their Career Progression?”

Fle

xib

le T

ime

Sch

edu

le

Gen

der

Div

ersi

ty In

itia

tive

s T

hat

C

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Gen

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Ste

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Ho

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Acc

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end

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Bet

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Men

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Ab

ove

Rem

ote

Wo

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pp

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un

ity

Co

ach

ing

Wo

men

Gro

up

s

0%

15%

30%

25%

12% 11% 10% 10% 9% 8% 7% 6%

1%

n = 1,464.Source: CEB Q3 2014 Global Labor Market Survey.

Note: Leaders are defined here as female employees with management responsibilities ranging from entry-level managers to CEOs.

These initiatives can only work within a broader organizational culture of diversity, and leading organizations create strategies that link diversity with outcomes that matter. They clearly explain to internal stakeholders how gender diversity relates to other strategic initiatives and the organization’s success. These companies back up that commitment by establishing hard and soft accountability measures for employees at all levels, and then monitor incremental progress toward those goals.

Four Imperatives to Increasing Gender Diversity in Leadership

1. Address micro-challenges throughout the career life cycle.

2. Make leadership opportunities clearly visible for women.

3. Make flexible work schedules available at all levels.

4. Create accelerated on-ramps back into leadership for women who temporarily opt-out of their careers.


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Closing ThoughtsHow can we approach diversity and the inclusion gap in a more structured manner?

What are the best companies doing to improve diversity and inclusion?

Which metrics are most compelling to show the business value of diversity and inclusion?

How can organizations get all employees to join in diversity and inclusion efforts?

How should we embed diversity and inclusion into our business processes?

How do we adapt our diversity and inclusion strategy for locations across the globe?

We’re frequently hearing these questions as the conversation moves away from simply trying to hire more women to recognizing the strategic value and bottom-line benefits of a gender-diverse workforce.

We have responded by creating a Working Council on Diversity & Inclusion that enables organizations to benchmark performance against best-in-class metrics and achieve critical business objectives through proven diversity and inclusion strategies.

Additionally, CEB TalentNeuronTM provides talent analytics and diversity intelligence to help organizations understand the state of diversity by role or location, run predictive analyses on how diversity is going to change over time, and analyze competitor diversity data. This intelligence is key for organizations to set realistic diversity and inclusion (D&I) goals and improve outcomes over time.

About CEBCEB is a best practice insight and technology company. In partnership with leading organizations around the globe, we develop innovative solutions to drive corporate performance. CEB equips leaders at more than 10,000 companies with the intelligence to effectively manage talent, customers, and operations. CEB is a trusted partner to nearly 90% of the Fortune 500 and FTSE 100, and more than 70% of the Dow Jones Asian Titans.

About CEB TalentNeuronTM

CEB TalentNeuron offerings provide you with the most comprehensive source of global talent demand and supply data, predictive analytics, insights into real-time job market and location data, and competitive intelligence to help you make informed recruiting and talent planning decisions.


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This study may not be reproduced or redistributed without the expressed permission of CEB.

Contact Us to Learn MorePhone: +1-866-913-6447

E-Mail: [email protected]

Web: cebglobal.com/talent-neuron

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white paper - gender diversity in stem us report

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