Women MBAs lag behind male counterparts: Study

Men earn more in first job, outpace women in climbing corporate ladder, salary growth
By Shannon Klie
|Canadian HR Reporter|Last Updated: 03/07/2010

When Sue Graham-Parker began her career at Scotiabank in 1979, it was unusual to see a female branch manager. Now one-half of the branch managers and more than one-third of the senior executives are women.

“No doubt, we have come leaps and bounds from 30 years ago,” said Graham-Parker, senior vice-president of public, corporate and government affairs at Scotiabank, in Toronto.

Unfortunately, there is still a long way to go before women find parity with men, according to a report from Catalyst, a New York-based research and advisory organization that promotes women in business.

Among MBA graduates from top international schools, women lag men in advancement and compensation from their first post-MBA job and are less satisfied in their careers overall, found Pipeline’s Broken Promise.

Catalyst surveyed 4,143 full-time employees who graduated between 1996 and 2007 from MBA programs at 26 business schools in Asia, Canada, Europe and the United States.

Men were more likely to start their first post-MBA job in higher positions than women, found the study. This difference held true even when women and men had the same level of experience, the same aspirations to reach the most senior positions and neither had children.

Only two per cent of women held a senior executive position as their first post-MBA job, compared to six per cent of men. Also, eight per cent of women held middle-manager positions, compared to 13 per cent of men, and 30 per cent of women held a first-level manager position, compared to 34 per cent of men.

Women were more likely to hold an entry-level position, at 60 per cent, compared to 46 per cent of men.

“I do believe there are a lot of subconscious things at play,” said Graham-Parker. “There are a lot of assumptions that people still make, when they’re hiring, about gender.”

These include women being less ambitious than men, leaving their career once they have children or being unwilling to work as hard, she said.

“But these are just assumptions,” said Graham-Parker.

Men also had higher starting salaries than women, earning about $4,600 more in their first job, found the study. The difference in compensation remained even when looking at women and men at the same job level.

After starting from behind, women didn’t catch up with men, who were more likely to be at a higher position and to have experienced higher salary growth at the time of the survey.

Men were twice as likely to be at the CEO or senior executive level, while women were significantly more likely to be at the entry or second level.

“The findings are very disappointing,” said Deborah Gillis, vice-president for North America at Catalyst. “It’s stunning to see that women from this high-talented group are starting their careers behind men, that they lag behind men and that they never catch up.”

The difference in career growth was most significant for men and women who both started at the entry or second level, with men significantly outpacing women in moving up the career ladder. Only when both men and women started their post-MBA careers at the middle or senior level were there no significant differences in the rate of career advancement.

“What we see is a pipeline in peril, with significant implications for companies if we don’t look to level the playing field and more fully utilize this high-potential talent group in our organizations,” said Gillis. “The energy, skills, contribution and knowledge of women are being underutilized.”

While both men and women were equally likely to have changed jobs since graduation, men were more likely to leave for career advancement or better compensation and benefits. Women were more likely to leave because of a difficult manager.

Only two per cent of men and three per cent of women left a job because of family responsibilities.

“We often make assumptions that we’ve solved the issue of the glass ceiling or we make assumptions about why women haven’t advanced,” said Gillis, but this study shatters those myths and assumptions.

While women were no more likely than men to take a non-traditional career path, working part time or being self-employed, women who took the non-traditional path advanced more slowly once they returned full time to an organization than women who took the traditional path. They also advanced more slowly than men on either path.

Overall, 37 per cent of men said they were very satisfied with their career advancement compared to 30 per cent of women. Only at the entry level was there no difference in the career satisfaction.

Also, women who stayed on the traditional path were more satisfied than women who opted for a non-traditional career path. But regardless of path, men were more satisfied with their careers than women.

“The first job, first manager, first supervisor and where women land become very important to their future career growth,” said Gillis.

Organizations need to ensure they’re pairing new hires with the right bosses, said Graham-Parker.

“There’s nothing more powerful than having the right mentor, the right coach, to help them navigate through an organization,” she said.

During annual development plan meetings at Scotiabank, managers ask their reports where they want to go in the organization and provide a leader profile — a list of competencies and experiences needed to become a leader at the bank — so no one makes assumptions about an employee’s career aspirations, said Graham-Parker

When Catalyst shared the results of the study with CEOs at various organizations, including Ernst & Young and Linamar, the CEOs had several suggestions for combating the gender inequalities.

These included looking at talent management processes to ensure the systems correct any early inequalities and examining erroneous assumptions about women’s aspirations, said Gillis.

“The important message here for leaders is ask, don’t assume,” she said.

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