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Returnships for women won’t fix the career break penalty

A lot to juggle. via

Women who want some help to return to work following a career break were given a boost by a £5m investment in “returnships” in the spring budget.

Returnships are return-to-work programmes – predominantly aimed at highly skilled women in management and professional services such as legal practice and financial services – that help people transition back into the workplace after a career break, often for childcare reasons. The scheme was pioneered by Goldman Sachs in 2008, and introduced to the UK by Credit Suisse in 2014. The programme runs as a short-term consulting project, drawing on skills and experiences to test whether people wish to return to a corporate job.

The new £5m funding seeks to increase the number of returnships at all levels of management where women are underrepresented, including both the public and private sectors. It follows recommendations made by a group of MPs that large employers should introduce these paid programmes with guaranteed training, advice and support to facilitate women’s return from career breaks. It is unclear yet whether smaller companies will also be supported in setting up returnships under the new scheme, and whether such initiatives would be opened up to a wider group of returners.

Barriers to return

Women in the UK leave careers in significant numbers at several points in their working lives and often experience difficulties in returning to work after maternity leave or career breaks. They are more likely than men to cut the number of hours or leave the job when family needs arise. This means they leave employment at different stages, especially when working hours and workplace requirements are difficult to manage alongside caring responsibilities for children or other dependants.

The implications for the gender opportunity gap are further pronounced when women have a second or third child, contributing to their cumulative disadvantage. The existing motherhood and care-related penalties on employment and earnings also translate into a higher pension gap. This means that women with care responsibilities are exposed to lower pension benefits and higher poverty risks in old age.

UK Gender pay gap by age group, April 2016 – based on median gross hourly earnings (excluding overtime) Annual Survey of Hours and Earnings, ONS

Maternity is the game changer, but women also increasingly leave their jobs mid-career. Mothers returning to the labour market from maternity leave may find their career progression hampered by even short periods of leave and part-time working. Many want to switch to flexible work after maternity leave, but this option is not offered by many employers. Even where it is available, the penalties in terms of career progression are perceived to be high.

The Royal Institution of Chartered Surveyors (RICS) reported in early March that women and men equally fear taking a career break for the negative effects this may have on their careers. A YouGov survey commissioned by RICS found that 50% of people believed women receive fewer opportunities when they return to work after taking maternity leave. Another 20% said that chief executives did nothing to drive gender equality or support women in the workplace.

Many women choose to or need to return to paid employment. This may be because of their need to earn household income, pension shortfalls or changes in family circumstances. But according to a 2016 study by services firm PwC, three in five professional women returners were likely to move into lower-skilled or lower-paid roles, experiencing an immediate earnings reduction of up to a third.

Parent support not sufficient

With Brexit looming, a reduction in the number of skilled workers from overseas may force the government and businesses to invest more in training British workers. Britain is already clearly failing to make the best use of its talent and workforce potential – it will need to get even better at it.

In 2006, the Women and Work Commission estimated that under-use of women’s skills cost the UK economy between £15 billion and £23 billion a year. PwC suggests that addressing the career break penalty could boost female earnings by £1.1 billion a year, equivalent to £4,000 per woman. It estimates that higher earnings and spending power of these women could generate additional gains to the UK economy of £1.7 billion.

While the £5m returnship fund recognises the difficulties that many women face when they take time out of the workplace and shows public commitment to support their return to work, it is a drop in the ocean. Especially when public investment in affordable high-quality and flexible public childcare and care alternatives, shared parenting and caring remain patchy. At the same time, a rise in employment tribunal fees may form a barrier to people bringing forward cases of potential discrimination.

Since the Equal Pay Act in 1970, legislative change has been instrumental in affecting positive change for women’s opportunities in the labour market. To respond effectively to the needs and requirements of a group of women returning to work, public policy should become more nuanced and adopt an approach focused on the whole life course, not just a part of it.

Britain could look to other examples from the EU, such as Nordic countries, which have more affordable high-quality and flexible public childcare, public support for shared parenting and caring, and more widely available flexible working structures.

Designing good jobs that allow employees to balance paid and unpaid commitments while fully using and rewarding their talents and skills puts employer leadership in the driving seat. It raises questions about rethinking notions of “typical” or “normal” working patterns and practices to shape work and improve opportunities, pay and progression for an ever more diverse workforce.

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