Businessolver Blog

Women and Financial Wellness Series: The Hard Facts and How Employers Can Help (Part 3)

Women and Financial Wellness Series: The Hard Facts and How Employers Can Help (Part 3)
Posted on Monday, March 27, 2023 by Rae Shanahan

Employers play a significant role in empowering women to actively manage and take control of their finances. This can come in the form of pay equity, financial literacy, female- and family- friendly benefits, career opportunities, and more.

Only about half of women (48%) feel confident about their finances, and just 28% feel empowered to take action.

To change this narrative, women need to be armed with the knowledge, resources, and confidence to more effectively manage their finances and save for the future.

Case in point, our 2023 Benefits Insights Report found that 52% of women would feel panicked about facing a large, unexpected expense versus 39% of men.

As discussed in part one of our series, employers play a large role in providing women with the resources to improve and empower their financial wellbeing. And, they have a tremendous opportunity toeven the scales and help women, who currently earn 83 cents on the dollar compared to men, advance their position in the workforce.

But it’s not as simple as pay equity as we learned in part two.

Women prioritize caregiving and family over finances, and their financial wellness often takes a backseat. During the pandemic, many women either downshifted their careers or left the workforce altogether to care for dependents—and their numbers have not yet recovered.

Women need help from employers to balance caregiving responsibilities with work.

Beyond that, women want a bigger seat at the proverbial table. Coined the “Great Breakup,” women leaders are leaving their employers at a record rate for companies that prioritize career advancement, flexibility, employee wellbeing, and diversity, equity, and inclusion (DEI) among other benefits.

Here are seven actionable ways employers can support women and empower their financial wellness:

1. Improve Financial Literacy

Nearly 70% of women say they’ve never met with a financial advisor compared to 41% of men. In general, women are less likely to have savings of any kind for when emergencies arise, let alone investing.

Research shows that women are less likely to have a financial advisor and to express comfort with receiving financial advice at work. This means employers need to make an extra effort to educate and encourage employees to take advantage of financial wellness programs, including coaching, budgeting, savings and investment strategies.

Beyond the obvious 401(k) plan, many of these voluntary and ancillary benefits play a huge role in improving women’s financial literacy and thereby their fiscal confidence.

But when it comes to benefits, Businessolver data shows that after five years of tracking engagement and literacy, 85% of employees are still confused.

This can lead to over- or under-insurance, ultimately costing employees—and employers alike—more money. Decision support technology, however, helps guide employees toward “right-fit” coverage options based on their financial, health, and emotional needs.

Employees are three times more likely to elect a cost-effective health plan and savings vehicle when they have decision support at the time of enrollment.

Our 2023 Benefits Insight Report data shows that personalized decision support during benefits enrollment triples the likelihood of an employee electing a cost-effective plan such as a high-deductible health plan (HDHP) and pairing it with financial support such as a health saving account (HSA).

2. Implement Empathetic and Female-Friendly Benefits

With women typically taking on a disproportionate share of caregiving responsibilities, benefits such as maternity leave, childcare, and even workplace flexibility are now table stakes. They are absolutely baseline benefits for attracting and retaining women employees.

Employers can shine by bolstering these baseline benefits—like subsidized childcare and robust mental health programs—while also prioritizing empathetic benefits that prioritize the whole person, including extended leave and flexibility programs, tuition reimbursement, financial coaching, and even fertility benefits.

For example, at Businessolver, we know more than 50% of our Solvers are women and 97% of our employees feel like they can be very productive working remotely.

Knowing this, we created several programs to help support them through extended workplace flexibility, including Workspace Anywhere, which is our shift to flexible, fully remote work and MyTime, which encourages employees to take personal time whenever they need it.

For employers, listening to their women workforce and understanding their unique priorities and needs is essential. Just to start: In 2023, more employees are starting their families later in life. Thus, the number of large companies offering or enhancing their family-building benefits grew by 8% in 2021. This includes egg freezing, drug therapy, intrauterine insemination (IUI) and in vitro fertilization (IVF).

FertilityIQ’s research found that:

  • 61% of employees who received this type of coverage said they felt more loyal and committed to their employer.
  • 73% were more grateful and 53% stayed longer.
  • 88% of women who had their IVF fully paid for returned to their employer following their maternity leave.

Another encouraging sign of progress: The cost of services such as in vitro fertilization, which can exceed $10,000 per cycle, is now covered by more than 40% of large U.S. employers.

3. Identify Pay Inequities in Your Employee Population

After decades, pay inequity persists for women. Men out earn women within every age group. As women progress in age, the wage gap for full-time women workers gets even more pronounced:

  • Among women ages 16–24, median weekly earnings are about 8% lower than men.
  • For women ages 25-54 (prime age workers), the gap is even bigger at 16% less than men.
  • Among women ages 55–64, the gap is bigger yet with women earning 22% less than men at the median.
  • Women aged 65+ earn 27% less than men of the same age bracket.

For women of color, the wage gap is even wider: Black women were paid 64% and Hispanic women 57% of what white men were paid in 2020.

Likewise, women see their earnings plateau relatively early in their careers while men’s earnings continue to grow. As a result, men are better able to save for retirement, pay down debt, and build equity and interest in their assets.

In the end, the wage gap seriously impact women’s economic security over their lifetime.

The obvious solution is for employers to examine their own data and take steps to address pay inequities. But the disadvantages women face run deeper than their earning power.

With women juggling so many priorities, access to financial support and guidance needs to be easy and even automated. For example, a robust 401(k) match provides both consistency and incentive to save more. Where employees often struggle, however, is how to best optimize their total benefits package to make their hard-earned dollars go further.

Our study shows how personalized decision support throughout the benefits lifecycle, not just at the time of enrollment, plays a large role in ensuring more equitable access to financial wellness for women—and all employees alike.

4. Recognize DEI Efforts

Delivering on DEI strategies is just an all-around requirement in today’s workplace. But new research from McKinsey points to an often-overlooked facet of DEI: giving credit where credit is due.

  • Female leaders invest twice as much time as their male counterparts on driving DEI forward in the workplace.
  • Yet 40% of these women leaders say this work isn’t being acknowledged.
  • Female leaders are more than 1.5 times more likely as their male counterparts to have left a previous job because they wanted to work somewhere with a greater commitment to DEI.

By failing to recognize women’s contributions to DEI, companies are closing the door on the next generation of women leaders who prioritize DEI. For instance, 76% of millennials said they’d leave their employer if DEI initiatives were not offered. And, 83% of Gen Z job candidates said that a company’s commitment to diversity and inclusion is important when choosing an employer.

74% of Millennials believe that their organization is more innovative when it has a culture of inclusion.

One of the ways employers can recognize their female leaders’ DEI efforts is to include metrics for people management and DEI work in performance reviews. Likewise, it’s important to examine the diversity of your employee benefits when considering how to attract women leaders of all ages. As our latest benefits data shows, the scope of benefits is widening with the generations. Tuition reimbursement might be high on the list for Gen Z women while family-focused benefits rank high for Millennial moms.

5. Create Career Advancement Opportunities

Lack of career advancement opportunities rank high among the reasons women are leaving their companies—currently at the highest rates ever.

For every woman at the director level who gets promoted, two women directors are choosing to leave their company.

  • Women are still dramatically underrepresented in leadership: Only 1 in 4 C-suite executives is a woman, and only 1 in 20 is a woman of color.
  • The “broken rung” is still holding women back: For every 100 men promoted from entry level to manager, only 87 women are promoted—and only 82 women of color are promoted.
  • 41% of women of color want to be top executives, compared to 27% of white women.

Some companies are successfully promoting inclusion for all women, such as Tampa General Hospital, which took the number one spot on Forbes’ 2022 annual ranking of America’s Best Employers For Women.

What is TGH doing right?

Half of  their C-suite executives are women, as are 70% of its senior vice presidents—nearly double the average at other healthcare companies. Other attributes include flexible work options, scholarships for continued education, an employee emergency fund for those in crisis, back-to-school grants for up to $600 in supplies, and educational and leadership development classes.

Companies with more gender-diverse boards saw a 42% higher return in sales, 66% greater return on invested capital, and a 53% higher return on equity.

Other companies that are making strides for women include REI, Microsoft, L’Oreal, Carvana, and Loyola University in Chicago which ranked number eight on the list.

“In today’s post-pandemic workforce, employees are demanding flexible work options. The expectation to work hybrid and work remote has not escaped us,” said Dr. Winifred Williams, chief human resources officer at Loyola. “In order to remain competitive, we are going to have to be adaptable.”

6. Foster Workplace Flexibility

Millions of women exited the workforce during the pandemic to care for dependents. But employers need to recognize that caregiving responsibilities didn’t end with the pandemic.

Women and working parents alike continue to face a rollercoaster of challenges such as 2022’s “tri-demic” or “triple-demic” of RSV, COVID-19, and the flu, an unprecedented formula shortage, and record inflation that has increased the cost of everything—food, diapers, gas, and childcare.

This is a real crisis and women are stressed out, stretched for time, and just plain tired.

Providing women workers with extra latitude in when (meaning what hours of the day) and where they work (remote, hybrid, in-person) can help them accomplish the many tasks on their plate—including managing their finances.

While flexibility can come in many forms, women have spoken loud and clearly that remote and hybrid options are preferred. Only 1 in 10 women want to work primarily on-site and, for many women, flexibility in the form of remote and hybrid work is a key reason they join or stay with a company.

71 percent of HR leaders say remote work has helped their organizations hire and retain more employees from diverse backgrounds.

While autonomy and time management are key benefits of flexible work, for many women, remote work also provides psychological safety. For some groups, including women of color, LGBTQ+, and women with disabilities, hybrid and remote work decreases microaggressions.

Black women, for example, are almost four times as likely as White women—and Latinas and Asian women are two to three times as likely—to hear people express surprise at their abilities or language skills.

Employers need to take note: The benefits of workplace flexibility run deep, and leaders need to examine all sides—and groups—before making broad judgments and mandates. The return to office push currently happening among high-profile companies is disheartening and the antitheses of empathetic leadership.

Our workplace empathy research shows that while 94% of employees value flexible work hours as empathetic, the option is only offered at 38% of organizations.

By closing this gap, employers can not only improve employees’ total wellness, but from a benefits perspective, flexibility is hands down one of the cheapest benefits employers can offer.

7. Be an Ally for Women by Putting Empowerment Strategies into Action

The encouraging news is more women are prioritizing their financial wellness. However, there’s still a long way to go.

Companies can accelerate progress by putting listening strategies into place, analyzing their data, and deepening DEI initiatives for women of all races and earning brackets.

It’s not enough for employers to be allies in the quest for women’s financial wellbeing. Companies must put advocacy into action.

Whether through pay equity, robust benefits packages, education, and more, employers play a vital role in women’s financial health and total wellbeing. But to compete for female talent, employers will have to think outside the box and do their best to bring forward holistic and competitive packages alongside empathetic company cultures.

When it comes to attracting and retaining women workers, there’s no limit to the creativity companies can apply.

The pandemic was three years ago. Certainly, it changed how employers take care of their female workforce, but COVID-19 changed life and work for everybody.