Women and Minorities in Management

WOMEN AND MINORITIES IN THE LABOR-FORCE
UNEMPLOYMENT
OCCUPATIONS
WOMEN ENTREPRENEURS
WOMEN AND MINORITIES ON CORPORATE BOARDS
LAWS AFFECTING EMPLOYMENT OF WOMEN AND MINORITIES
CONCERNS OF WOMEN AND MINORITY WORKERS
WOMEN AND MINORITIES IN MANAGEMENT
BIBLIOGRAPHY

The role of women and minorities in the American workplace has developed radically over the past century, especially with regard to roles and contributions. These developments have enriched organizations of all types and sizes and allowed free enterprise to move in a more positive, profitable, and productive direction.

For thousands of years, women have served their families by taking charge of the activities that create a home. As times changed and economic opportunities moved from farms to factories, the roles of women evolved. Instead of staying home working for the family, women began looking for jobs outside the home. While many women took up work as teachers and nurses, others worked in factories or low-paying clerical and labor jobs. The industrial revolution forever changed the way the American economy operated, and with that change, more and more women chose to work and supplement family income.

Additionally, the demographic mix within the twenty-first century workplace has become much more diverse because many workers now entering the workforce are neither white, male, nor English-speaking. People of color continue to increase their share of the labor force. The rates of growth for these groups are projected to be faster than the rate for whites.

WOMEN AND MINORITIES IN THE LABOR-FORCE

In 1950 only about one in three women were members of the workforce. By 1998, approximately three out of every five women of working age were working outside of the home. By 2003, close to 60 percent of all women aged sixteen and older were in the labor-force. The U.S. Department of Labor projects this figure will continue to increase

at a slower rate and is projected to reach nearly 63 percent by the year 2015.

At the beginning of the twentieth century, women made up less than 20 percent of the United States work-force. By 1950, this percentage increased to 33.9 percent. By the year 2000, women comprised more than 46 percent of civilian workers. Therefore, within roughly the past fifty years, the number of women in the American workforce has multiplied by more than 240 percent. As of February 2005, there were almost 67 million civilian women employed. The U.S. Department of Labor estimates that women over the age of twenty participated in full-or part-time work at a rate of 62 percent in 2004. Furthermore, the increase of women participating in the workforce will cover many racial groups, with women of color enjoying the fastest growth rate.

Interestingly, however, the rate of growth of women in the labor-force has slowed somewhat during the last decade of the twentieth century. One cultural shift that appears to be contributing to this curiosity is the renewed emphasis on having a family; regardless of marital status or sexual preference, the desire to start a family is on the rise for almost every demographic. At one time men were expected to be the primary wage earners of the family, while women were expected to make the home. Renewed societal emphasis on these traditional roles for men and women during the 1990s arguably placed greater pressure on men and women. Some researchers attribute the slower growth rate to factors such as increased educational attainment by married women, the recession of the early 1990s, a rising birthrate, and a slowdown in women's return to work after giving birth. These conditions have not led to lower employment rates for women as compared to men, and with the advent of the Internet, telecommuting, and remote home offices, more women work today than ever before—while also caring for their families.

Minorities. Minority labor-force, including women, is expected to continue to increase especially for Latino-dominant non-whites. Latinos are predicted to be the second largest group in 2025, accounting for 17 percent of the total workforce. Furthermore, as of 2000, Latinos have a larger share of the market than African Americans, 13 percent versus 12.7 percent. The share of African Americans in the workforce is expected to increase by only 1.8 percent during the same time period. Asians and other minorities would account for 8 percent of the labor-force in 2025. Latinos and Asians, therefore, will continue to be the two fastest-growing groups.

UNEMPLOYMENT

Historically, women have endured higher rates of unemployment than men; however, this trend appears to be changing. Through the first quarter of 2005, the seasonally adjusted unemployment rate for women ages twenty and over was 3.9 percent, while the average rate for men in the same age range was 4.1 percent. The unemployment rate for African American women was higher, averaging 9.1 percent for the first quarter of 2005, while African American men were unemployed at a rate of10.9 percent. By 2007 the unemployment rate for women in the United States was 4.5 percent compared to a 4.7 percent unemployment rate for men of the same age range. Asian women had the lowest unemployment rate in 2007 at 3.4 percent.

OCCUPATIONS

The biggest percentage of women employed in the United States are working in technical, sales, and administrative support occupations. However, one of the most significant changes that took place in the twentieth century was the rise of women managers. In 1900, only 4.4 percent of managers were women. By 2000, 46 percent of all managers were women, a ten-fold increase. By 2002, 34 percent of working women were in a managerial or processional occupation. However, both women professionals and women managers are clustered in certain specialty areas. In 2002, nearly 50 percent of women workers were employed in three occupational groups—sales, services, and administrative support. As example, only 11 percent of engineers were women, but 98 percent of preschool and kindergarten teachers were women. Furthermore, only 19 percent of dentists were women, whereas 93 percent of registered nurses were women. Conversely, in 2006, studies show that more women than men are now attending medical and veterinary school as well as masters programs, and more women than men demonstrated sound understanding of investment. Only in underdeveloped countries is education not a priority for the female population; it can therefore be stated that a sign of social and economic growth of a nation is the educational bar it sets for its women.

WOMEN ENTREPRENEURS

Businesses owned by women are increasing in terms of quantity, diversity, and impact on the American economy and by 2006 women in ownership, management, and the rest of the labor-force had a greater impact on global GDP than the influence of China, India, or technology. In 2003, over 38 percent of self-employed persons were women and almost 6 percent of employed women were self-employed. Furthermore, women-owned businesses employ over 19 million people in the United States or one in every seven employed persons nationwide according to figures published by the Center for Women's Business Research. As of 2004 there were 10.6 million women-owned businesses

in the United States. Job growth provided by women-owned businesses has exceeded the national averages in almost every major industry. Between 1997 and 2004 the number of businesses owned by women increased by 24 percent compared to 12 percent for all firms. The global GDP is impacted more heavily among the industries that have experienced the most dramatic growth in women-owned businesses are construction, manufacturing, wholesale trade, transportation, and communications. This growth in businesses owned by women has exploded since the 1960s and continues to move on an upward trend as more and more women of working age continue to seek work as managers and business owners rather than laborers and members of the service industry.

Many of the businesses owned by women are home-based. By 2002, 66 percent of all home-based businesses were owned by women. These enterprises are changing the face of business because they enable many women to balance work and family commitments at home while fulfilling professional objectives.

WOMEN AND MINORITIES ON CORPORATE BOARDS

The combination of increased cultural and governmental pressure for corporations to add women to their boards has resulted in an increase of women seated on corporate boards. As of 2003, 89 percent of the corporate boards in the Fortune 500 had at least one female director. Nonetheless, women still only accounted for 13.6 percent of all corporate board members in 2003. Further, the same women often held several of these seats on different corporate boards. According to the U.S. Department of Labor, by 2007, 51 percent of management and professional jobs in the United States with the highest pay were occupied by women.

Although minorities have been entering the workforce in record numbers, reaching the top of the corporate ladder has been an uphill battle with much progress still ahead. A 2005 examination of the Fortune 1000 companies reveals that one in twelve organizations has at least one African American on their Board of Directors—a staggering leap from even a decade ago. Still, other minorities are underrepresented and a long road lies ahead for those who wish to see color, class, race, gender, religion, and sexual preference be hiring and firing determinants of the past.

LAWS AFFECTING EMPLOYMENT OF WOMEN AND MINORITIES

The Equal Pay Act of 1963 was enacted as an amendment to the Fair Labor Standards Act. The Equal Pay Act forbids employers from paying employees different wages or salaries based on sex. The act mandates that employers may not pay men and women different wages if their jobs require equal skills, effort, and responsibilities and occur in the same work environment. If men and women in the same jobs do receive different pay, their pay must be equalized by raising the lower pay rather than lowering the higher pay. The Equal Pay act specifies four instances in which differences in pay are permitted: (1) under a seniority system; (2) under a merit system; (3) under a system that measures earnings by quantity or quality of production; or (4) under a differential system based on any other factor besides sex.

The act is administered by the Equal Employment Opportunity Commission (EEOC). To ensure enforcement, employers are required to keep records documenting employee hours, pay rates, job descriptions, and other relevant information. If employers violate the act, they may be required to pay back wages and possible punitive damages.

Title VII of the Civil Rights Act of 1964. Title VII of the Civil Rights Act of 1964 prohibits discrimination in hiring, firing, promotion, assignment, and other treatment of persons in the workplace based on race, color, national origin, religion, or sex. Title VII applies to both public and private employers, employment agencies, and labor unions with fifteen or more employees or members. As with the Equal Pay Act, the EEOC administers enforcement of Title VII (Civil Rights Act of 1964).

In addressing claims, the courts have held that sex discrimination under Title VII refers to discrimination based on gender and not related to sexual orientation. In addition, while Title VII does not ban discrimination based on marital status, there are many state laws that forbid such discrimination.

Sexual Harassment. Subjecting women to sexual harassment in the work place is considered a form of sex discrimination under Title VII. Generally, there are two primary forms of sexual harassment: quid pro quo, and hostile environment. Under the quid pro quo-type of sexual harassment, a victim is either promised a reward (i.e., pay raise, promotion, etc.) in exchange for sexual favors, or threatened with punishment for not complying with sexual requests. These requests can be expressed or implied.

Under the hostile environment theory, the employer is charged with creating conditions, or allowing others in the work place to create conditions, that make the work environment extremely unpleasant or hostile for the victimized employee(s). The types of activities that may contribute to a hostile work environment include: displaying sexually suggestive pictures; using offensive or sexually suggestive language; discussing sexual activities; talking about a person's physical characteristics; inappropriate touching, etc.

Employers have a legal obligation to prevent either type of sexual harassment from occurring in the work

place. Businesses usually establish detailed policies to try to prevent sexual harassment situations from arising in the work place.

Pregnancy Discrimination Act. Title VII of the Civil Rights Act was amended in 1978 by the Pregnancy Discrimination Act, which bans discrimination against women in employment because of pregnancy, childbirth, and related medical conditions. This act provides that women covered by the law “shall be treated the same for all employment-related purposes, including receipt of benefits under fringe benefit programs.”

Executive Order 11246. President Lyndon B. Johnson issued Executive Order 11246 in 1965. This order mandates that companies who do business ($10,000 or more annually) with the federal government must take affirmative actions to increase the representation of women and minorities in their employment ranks. If a company in question does more than $50,000 of annual business with the federal government, its affirmative action plan must be in writing.

Family and Medical Leave Act of 1993. Enforced by the U.S. Department of Labor, the Family and Medical Leave Act applies to private employers with fifty or more employees and to all governmental employers, and requires employers to provide up to twelve weeks of unpaid leave to employees who have undergone childbirth; adoption; personal illness or injury; or illness or injury of a child, parent or spouse. During the leave period, the employee's health benefits must remain intact. Once the employee returns from the unpaid leave, the employee is entitled to return to the same or a comparable position.

CONCERNS OF WOMEN AND MINORITY WORKERS

Despite the progress women made during the twentieth century, differences remain in the average pay of men and women. Although between 1979 and 2003 the earnings gap between women and men narrowed significantly, according to the Bureau of Labor Statistics, women still earned 79 cents to every dollar earned by men in 2003.

Maternity, Pregnancy, Childbirth, and Childcare. According to the U.S. Department of Labor, 99 out of every 100 women will work for pay in the United States at some point in their lives. Further, the number of families in which a woman is the head of the household and no male spouse is present is continuing to rise. In 2003, women were the primary breadwinners in over 22 percent of all families in the United States, and 72 percent of these female heads of households were employed. Furthermore, the proportion of married-couple families in which only the wife worked rose to 6.8 percent in 2003. With so many women in the workforce—both single mothers and married women—many of these women were concerned with balancing work with pregnancy and childcare issues.

Despite the increasing need for childcare as more mothers work outside the home, very few companies have policies for dealing with working parents who need outside childcare. Although some women quit their jobs or delay advancement at work to pursue motherhood, other women may postpone parenthood in pursuit of the executive suite. A 2001 nationwide survey of high-earning career women found that 67 percent of them were mothers at ages forty to fifty-five. Another survey of 187 of Fortune Magazine's Most Powerful Women in Business found that 72 percent were mothers. In fact, as of 2003 nearly three-quarters of all mothers were in the labor-force, including more than 60 percent of women with children under the age of three. Therefore, working women continue to balance work and family more and more successfully as the paradigm shifts. Historically, women have been forced to take lower-paying jobs, and it is often the case that the structures, habits, values, and atmospheres of work become organized around the availability of women whose top priority is their children.

In addition to the challenge of finding childcare, some working women are forced to face the issue of pregnancy discrimination. Despite the fact that the courts have banned pregnancy discrimination as a form of sex discrimination under Title VII of the Civil Rights Act, working women are still dealing with the problem. In 2004 4,512 women who claimed that they were discriminated against as a result of pregnancy filed charges with the EEOC. Of the claims that were found given merit, employers were forced to pay over $11 million in damages (not including litigation).

Alternative Work Schedules. The increasing number of women in the work place has generated a demand for alternative work schedules. Because women operate as the field managers of their households and also maintain a profession, sometimes they require greater flexibility in their work schedules than their male counterparts who work a “nine to five” without having to juggle other activities. Alternative work schedules offer the dual benefit of providing heads of household with flexible schedules to meet familial obligations while enabling employers to benefit from the work these types of employees offer. Generally, alternative work schedules can take several forms: (1) flexible work schedules, (2) compressed work schedules, and (3) job-sharing. Each of these types of work arrangements represents a departure from the traditional fixed schedule of eight hours per day, five days per week, beginning and ending at the same time each day.

Flexible work schedules allow an employee to determine his or her own schedule within specified parameters. Employers may allow employees to vary their start and stop time daily or to adhere to a predetermined fixed start and stop time. Under a system of compressed work schedules, full-time employees may still work 40-hour weeks; however, they may work four 10-hour days and take one day a week off. Another arrangement may exist when an employee works four 9-hour days and one 4-hour day or any other variation that is agreed upon between the employer and employee.

Job sharing is where two employees share the same job; these two employees may alternate days, or one may work mornings and the other works afternoons. Employers are under no obligation to offer alternative work schedules; however, many employers are recognizing that it is in their interest to offer some such arrangement in order to avoid alienating a valuable segment of the work-force. Alternative work schedules allow employers to attract employees who can make significant contributions to the company while fulfilling their family or other kinds of commitments at the same time.

In 2003, 25 percent of all female salary workers worked fewer than 35 hours per week. In contrast, only 11 percent of employed men worked part time.

Sexual Harassment at Work. Despite legislative and judicial efforts to minimize incidences of sexual harassment at work, it is still a significant problem for women in the work place. In 2004 a total of 13,136 claims of sexual harassment were filed with EEOC and with the state and local Fair Employment Practices agencies around the country that have a work-sharing agreement with the Commission. Of these complaints, women filed 84.9 percent of them. The damages awarded based on many of these claims (not including awards from litigation), totaled approximately $37.1 million.

Employers have clear incentives to prevent sexual harassment from occurring in the work place; the courts have determined that sexual harassment is a form of sex discrimination under Title VII of the Civil Rights Act of 1964. Employers found guilty of sexual harassment or allowing it to occur can be forced to pay substantial damages. Beyond the legal and monetary penalties, companies can suffer because sexual harassment can lead to lower productivity, absenteeism, employee turnover, poor morale, and devastating publicity for the company.

WOMEN AND MINORITIES IN MANAGEMENT

The growing number of women in the labor-force over time has meant more women in management positions—in 2007, 39 percent of employed women worked as managers, professionals, or in related fields where expertise and higher education are required. As of 2007, more women than men are financial and human resource managers, as well as budget analysts, auditors, accountants.

In the executive suite, women made up 8.7 percent of corporate officers in 1995 and 15.7 percent of corporate officers Fortune 500 in 2002—a radical increase over only seven years. In 2005, women made up 16.4 percent of corporate officers, proving that the numbers are on the upward swing. Women are CEOs, chairpersons, and presidents of some of the most powerful and important corporations today, including Xerox, eBay, Ogilvy & Mather, PepsiCo, Kraft Foods, TJX, Rite Aid, and Reynolds American.

In a similar fashion, many minorities have topped out at entry or mid-level management positions. In 2003, African Americans held less than 1 percent of the senior-level corporate positions in America's 1000 largest companies despite equal opportunity and affirmative action programs.

The Glass Ceiling. While the numbers of women rising to the management level now surpass the number of men, many women who do rise above middle management may find it difficult to secure a position at the top of the organizational structure. Many observers describe this as a “glass ceiling” acting as a barrier between women and the top-level positions they are striving for.

For years minorities have faced these same invisible, subtle, yet very real institutional barriers to promotions into higher level executive positions. The belief that minority groups reach organizational plateaus consisting of artificial barriers that derail them from senior management opportunities has been alternately termed “the brick wall.” These barriers found in the structure of many organizations have often stymied the advancement of some minority employee groups.

Many women may confront “glass elevators” rather than “glass ceilings” as a function of being in an industry or work environment that does not foster the upward movement of women. While the existence of such barriers has been acknowledged for decades, successfully combating them is a process, and it will take a long term commitment from men and women alike. Eradicating gender barriers makes excellent business sense. Treating women unfairly in the workplace or not allowing them to advance based on their merits may lead to disillusionment and higher turnover among very capable women—and cheat companies out of some of its best human resources. Also, if irrelevant factors are used to exclude women from the top management positions, all employees may begin to assume that similar extraneous factors would affect their future progress in an organization.

Now that there are more women in management positions than men, the odds increase that women will have more opportunities at all levels of business. Nonetheless, U.S. corporations and those who act as the stewards of the status quo in American spheres of commerce still have a tremendous distance to travel before women can say that they enjoy equal opportunity in the workplace.

SEE ALSO Diversity; Entrepreneurship; Mentoring; Sensitivity Training

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