Women have made significant progress in the labor market over the past few decades, however, they are still woefully underrepresented in finance.
According to the World Economic Forum’s Global Gender Gap Report, female talent in finance still remains one of the most untapped business resources.
While women make up more than half of the entry-level finance workforce in the United States, only about 6% of the top public financial institutions have women in senior positions.
To increase the number of women in finance, organizations must create a welcoming, friendly and supportive environment for women. They also need to develop programs that help women advance their careers.
To this end, organizations are:
- Encouraging gender diversity in the workplace
- Providing training and development opportunities for female employees
- Providing mentorship and networking opportunities for female employees
Today, we’ll look at why there are so few women in finance, the percentage of women in finance, and some startling facts about women in finance.
Why There Are So Few Women in Finance Careers
For most young girls who are just starting to explore their interests, finance may not be the first career option that comes to mind. Finance is still thought of as a male-dominated field that’s difficult to break into.
Despite these challenges, the number of women working in finance is increasing, and as more women enter the finance industry, there will be more opportunities for advancement.
There are many ways to break into finance, learn, and get a business degree.
The Quantic program is a unique and engaging way for busy professionals to build their knowledge and gain their business degree.— Elizabeth Kennard, Sr. Manager, Canon Medical Systems USA, Inc.
Reason # 1 – Women Fields Fewer MBA Students
A study by The Forté Foundation, a non-profit consortium of top business schools, shows that although gender equality is increasing in business schools, the number of MBA applications is not increasing at the same rate.
The study found that the number of women enrolled in business schools has increased by over 60% for the past five years, yet female MBAs seem to be decreasing every year. For instance, in 2018, they fell by 7%, while in 2019, they decreased by 9.1%.
However, thanks to initiatives, such as the Women in Finance Awards, to increase women in finance, these numbers are sure to change.
Reason # 2 – Lack of Mentors and Role Models
Many women in finance cite a lack of role models or mentors as a major deterrent to pursuing their careers.
Research has shown that mentoring programs can boost minority representation in managerial positions by about 9% to 24%.
Moreover, female mentors can smoothly guide their mentees up the corporate ladder by helping them learn such skills as emotional intelligence, making connections, and effective communication.
Reason #3 – Balance Work and Family Life
There is a widespread belief that women in finance don’t have the same work-life balance as their male counterparts.
Women in finance careers often have to juggle work and family responsibilities, making it overwhelming. For example, a mother may work full-time and still have to care for her young children.
However, work-life balance among women in finance is slowly changing as men take more responsibilities at home.
Reason # 4 – Feeling That the Field Is Too Competitive
Some women believe finance and accounting fields are very competitive.
This often makes them underestimate their own capabilities and refrain from applying for or accepting positions in finance or accounting. They feel that they lack the necessary skills or qualifications to become a CFO, CEO, or other executive role.
However, things are changing, and there are more opportunities for women in finance than ever before. Major financial institutions, such as HSBC and JPMorgan Chase & Co., have made significant strides in increasing the number of women in senior roles.
How Many Women in Finance
The number of women in finance varies depending on various factors.
However, the number of women in C-suite roles in North America is expected to rise by about 7% by 2030.
Here is a table showing the percentage of women in finance by C-Suite positions.
|C Suite Position||% Of Women|
Nine Shocking Statistics About Women in Finance
Statistic # 1 – 40% Of US Businesses Are Women-Owned
According to WBENC 4 out of every 10 businesses in the USA are owned by women.
As of 2019, there were approximately 13 million women-owned businesses—a significant increase from the approximately 11.6 million female-owned businesses in 2017.
This trend shows that more and more women are starting businesses, and such businesses will need to hire highly skilled persons in finance, accounting, and other roles.
Statistic # 2 – Women Earn $0.82 for Every $1 Earned by Men
On average, women earn $0.82 for every $1 earned by men in the United States. This is due to several factors, including that women are more willing to work in low-paying fields and are less likely to be promoted to management positions.
Wage discrepancies are still influenced by sexism especially in fields where women make up a considerable share of the workforce, such as nursing and teaching.
Statistic # 3 – Only 46% Of Workers in the Financial Services Are Women
Women only account for 46% of the workforce in the financial services industry. There are several reasons for this, including the fact that men traditionally hold most financial services jobs.
Additionally, women are less likely to pursue careers in finance because they perceive the industry as riskier and less rewarding than other fields. However, there are many opportunities available to women in the finance industry.
Statistic # 4 – 57% Of Black Women Who Graduate College Have Difficulties Repaying Their Student Loans
According to the American Association of University Women, more than half (57%) of black women who graduate college have difficulties repaying their student loans—20% more than white women facing similar difficulties.
Difficulties in paying loans can lead to:
- Inability to advance one’s career
- Decreased chances of owning a home
- Difficulty accessing credit cards and finding well-paying jobs
To avoid bad debt, we encourage women to enroll in institutions that offer scholarships for women in finance and other courses.
Statistic # 5 – Less Than 17% Of Senior Positions in Investment Banking Are Held by Women
In the United States, women hold less than 17% of senior positions in investment banking. There remains a strong bias against women when evaluating their leadership potential.
Most companies need to change their assessing strategies and promote employees based purely on individual performance.
Statistic # 6 – Only 2% Of Assets and Mutual Funds Are Exclusively Managed by Women in USA
According to Morningstar, women exclusively run just 2% of the US fund industry’s assets. Conversely, men exclusively manage 78% of the industry’s funds and 74% of assets.
Some possible reasons for the disparity include:
- Women are less likely to have a background in finance.
- Women are less likely to be promoted to senior roles in finance.
- Women face gender discrimination in the financial industry.
Statistic # 7 – Women in Banking and Finance Have a 25% Lower Level of Confidence in Their Financial Competence
Low financial understanding has dire consequences because it’s directly linked to important financial decisions.
Statistic # 8 – Only 10.5% Of Black Women Make Up the Finance Sector
Black women in finance are not well represented due to the many barriers they face, including:
- Deeply rooted systemic oppression in various organizations
- Fewer black women pursuing MBA
Statistic # 9 – It’s About 3x More Likely for Employed Women to Work Part-Time Than Employed Men
Women are 3 times more likely than men to choose part-time work due to more flexible hours to accommodate family responsibilities.
Why Do There Need to Be More Women in Finance
The impact of gender diversity on business performance can’t be overstated.
Several studies suggest that having a more diverse workforce can lead to better decision-making, innovation, creativity, and problem-solving. What’s more, companies that promote gender diversity have proven to be more profitable and innovative than those that don’t.
It’s good, then, that there are many ways for women to break into the finance world, such as applying for a Quantic MBA. An MBA will help you:
- Develop a clear path for your career advancement
- Prepare for leadership positions
- Attain better work/life balance