Fully utilising returning female professionals could bring the UK £1.7bn of economic benefits

Two-thirds of professional women go into lower-skilled or lower-paid roles, or work fewer hours than they prefer, when they return to work after a career break, according to research published today by PwC, in conjunction with Women Returners and 30% Club.

427,000 UK female professionals are currently estimated to be on a career break and likely to return to the workforce in the future. Of those, three in five (249,000) are likely to enter lower-skilled roles when they return to work. This has serious implications for earnings as this downgrading is associated with an immediate 12-32% reduction in hourly earnings, depending on whether the woman remains with the same employer.[1]

A further 29,000 women returning to part-time work would prefer to work longer hours but are unable to due to a lack of flexible roles[2]. Altogether, two-thirds of (or around 278,000) women could be working below their potential when they return to the workforce.

Addressing the incidence of this ‘occupational downgrade’ could therefore have significant personal economic and business gains for professional women working at their full potential, according to the research – boosting their combined annual earnings by £637 million. Increasing the hours worked by part-time working women, meanwhile, could contribute an additional 14,000 full-time employees to the UK workforce annually, while boosting earnings to this group by £423 million.

Taken together, the research estimates that returning professionals lose out on £1.1 billion of earnings annually from the career break penalty, equivalent to £4,000 for each woman. The research estimates that the multiplier effect from the increased earnings and spending power of these women (beyond the increase in their incomes) could drive a further increase in output in the UK economy of £1.7bn.

Laura Hinton, executive board member and head of people at PwC, said:

“The business and economic arguments for getting more women back into high quality work following a career break are compelling. Our research shows the UK economy could see a £1.7bn boost, women will get higher earnings and businesses will benefit from a stronger pipeline of female leaders and more diverse teams. Many women want to return, it is the system that needs to change.”

The research suggests that opportunities for women are constrained by a lack of flexible or part-time roles available. According to a 2015 Timewise study, 6% of advertised roles with a salary of over £20,000 were available on a flexible basis, shrinking to 2% for roles with a salary of over £100,000.

Women also face barriers of negative CV bias amongst recruiters and potential employers, who assume that the lack of recent experience is automatically associated with an erosion of skills.

Julianne Miles, Co-Founder and Director of Women Returners said:

“A CV gap presents a significant barrier to resuming a successful professional career after a multi-year break. Employers often assume a lack of recent experience equates to a loss of the ability to operate at a senior level. A US study found that managers prefer to hire a less qualified candidate over one who has been out of work for more than six months, as they assume skills have deteriorated[3]; and this recruitment bias is far greater with a multi-year gap. Those returners seeking a part-time or flexible role to combine work with family life also struggle to find a suitable professional opportunity.”

Brenda Trenowden, Global Chair of 30% Club, commented:

“Women returners are a huge untapped talent pool for business. Recruiters and employers need to do more to reassess how they evaluate a candidate’s potential and work to address the negative bias towards CV gaps. Getting more senior women back into the workplace will help businesses build stronger pipelines of potential female leaders and improve the diversity of businesses at senior levels. Returnships create an effective route back to mid- to senior-level professional roles, and the availability of part-time and flexible opportunities in professional roles helps widen the pool of talent businesses can access.”

Julianne Miles added: “I am encouraged that there are a growing number of both returnships and flexible hiring opportunities which are starting to address these challenges, however substantial change is still needed to enable more of these high-calibre professional women to get back to higher-skilled roles."

Laura Hinton concluded: “We started our Back to Business scheme at PwC as we realised that there are many talented women that want to return to work but find it very difficult to do so via the normal routes. We need to look for people with potential in different ways and keep challenging our recruitment processes to ensure they are free from bias and open to all. This includes making more of our roles available as flexible.”

The PwC research was presented today at the inaugural Women Returners Conference in London, hosted by the ICAEW and sponsored by Credit Suisse, Skanska, PwC, O2, Fidelity International and The Cabinet Office, supported by 30% Club.

END

For more information on the research please visit www.pwc.co.uk/womenreturners

Notes to Editors

About PwC
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 157 countries with more than 223,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

About 30% Club
The 30% Club campaign was launched in the UK in 2010 with a target of achieving a minimum of 30% women on FTSE-100 boards – currently the figure stands at 26% up from 12.5%.  As of 2016, that target has been expanded beyond the FTSE-100 to a minimum of 30% women on FTSE-350 boards by 2020. In tandem with this, the 30% Club has introduced a pipeline target of a minimum of 30% women at senior management level of FTSE-100 companies by 2020.

The 30% Club was founded by Helena Morrissey CBE, Chair of Newton Investment Management and Chair of the Investment Association. Day-to-day activities in the UK are now led by 30% Club Global Chair, Brenda Trenowden of ANZ, and a Steering Committee.

The 30% Club currently has Clubs across the world in the US, Canada, Australia, the GCC, Hong Kong, Ireland, Malaysia, Italy and Southern Africa.

Media Contact
Georgina Whittle, 30% Club
Georgina.whittle@mhpc.com
(0)203 128 8528

 

[1] Connolly and Gregory (2009)

[2] Based on research by Digital Mums (2016) which reports more than a third of working mums would increase the hours they worked if roles were more flexible

[3]  Ghayad (2013)