Beyond the Gender Gap

Last Spring, The Economist trumpeted “womanpower” as the driving force for the world economy. But if Europe’s economy is to become more competitive and innovative, it is not enough that women enter the labor market in droves. To reap the full fruits of women’s talents, they must be in more top jobs, too, both in the public and private sector.

Women in Western Europe have long since bridged the education gap with their male peers. Women not only outnumber men at universities; they also outperform them, most notably in math, physics, and information science. But female students’ academic achievements have not increased women’s presence in top jobs. In Europe, the percent of women on corporate boards remains in single digits, as is true of the top ranks of government and academia.

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While in the United States almost one out of five corporate officers are women, in mainland Europe the female to male ratio on company boards is one to twenty or worse. The situation is only slightly better in science. One of every ten professors in Europe is a woman. In the US, the ratio is – once again – more favorable to women, with more than 20% of professors at American universities being female.

Europe cannot afford to waste valuable human capital at a time when China and India are on the rise and its own population is aging. The first baby boomers have reached retirement age, and the labor force will soon be shrinking in most parts of Europe. To cover the costs of aging and maintain its position as an economic power, Europe must increase overall labor participation considerably.

Not only can and must fathers assume a greater role in child rearing; a large part of homemaking is perfectly suitable to be met by the market. As economists Ronald Schettkat and Richard Freeman have pointed out, career women do not necessarily work more hours per week than women with part-time jobs or stay-at-home moms. Instead, they tend to outsource activities like grocery shopping, cooking, and cleaning.

If women in Europe work more hours in better quality jobs, it will stimulate demand for service jobs like cleaning and child care, thus reducing unemployment among low-skilled workers. Moreover, the increased supply of high-quality female labor will not incur additional healthcare and pension costs, unlike labor immigration. Women use those benefits anyway, whether they are stay-at-home moms or perform paid work outside the home.

Because people live longer and procreate less, raising and caring for children requires less of a parent’s life than it used to. Women should be able to aspire to top jobs without squandering their fertility, and their success would encourage women in lower-ranking positions, because female managers tend to implement more gender-conscious hiring policies and serve as strong role models.

Obstacles to the professional advancement of educated women in Europe is rooted in corporate culture, gender biases, and stereotyping, rather than outright discrimination. Group dynamics prevent company boards that consist solely of males from including women, even if members individually would support such a decision.

Moreover, those women who do reach higher-ranking positions are susceptible to a visibility-vulnerability spiral, owing to their minority status. As long as women are perceived to be the weaker sex, men and women alike will project their own feelings of vulnerability onto the female candidate. Such exclusionary group dynamics can be overcome only by attaining a critical mass of women in high-ranking positions.

The benefits of doing so would be enormous. Studies show that companies with more women in senior management are more profitable than those with few women at the top. Diversified management means better management. Including more women in top positions, both in the public and private sector, changes decision-making processes fundamentally, because women tend to play down the importance of formalities and communicate directly, thereby overcoming organizational blockages.

A decisive pro-women strategy would thus create new momentum for Europe, allowing it to compete with the United States and Asia. At the start of this year, Norway enacted legislation that requires that both sexes be represented by at least 40% on all corporate boards. Companies that do not meet the new gender rules, which also apply to the public sector – risk being dissolved by court order. Spain’s prime minister, José Zapatero, recently proposed similar standards for gender balance in business and politics.

Norway has set an excellent example – one that all of Europe should follow as the best way to transcend the culture of gender bias and stereotyping that is still prevalent in many companies and institutions. But women, too, must adjust. The reality is that top jobs require more than two workdays a week, and they do not coincide with school hours. Assuming the responsibilities that have long belonged to men requires that women let go of the tasks that have prevented them from advancing beyond low-ranking positions.