There’s a growing exodus from the corporate world to the private sector, and executive women are leading this charge. In fact, women are leaving corporate jobs in favor of entrepreneurship at twice the rate of men, according to Cheskin Research, a California-based strategic market research and consulting company.
There are some interesting trends for women entrepreneurs popping up in recent research. According to the Center for Women’s Business Research, the number of women-owned U.S. businesses grew at twice the rate of all firms between 1997 and 2002, and the U.S. Small Business Administration reports that women-owned businesses account for 28% of all privately-owned companies. They employ more than 9 million people and contribute $2.38 trillion in revenue to the U.S. economy.
Which raises a rather interesting question: Why are women executives leaving Corporate America? In the past, women were willing to devote their time, effort and energy to meet the corporation’s goals at the expense of their own needs. Not anymore, however. Women executives are starting their own businesses in order to gain more:
- Other personal benefits and rewards
51% of women business owners who worked in the private sector prior to starting their own business cite the need for more flexibility as the primary reason for leaving corporate positions, according to a study by Catalyst, a nonprofit research and advisory organization working to advance professional women.
29% pointed to restrictive glass-ceiling issues as the reason they “opted out” of Corporate America, and of those women, 44% felt their contributions weren’t recognized or appreciated. “Opted out” is the latest buzzword to describe the growing trend within corporate circles to leave corporate positions in favor of alternate career paths.
According to Catalyst President Sheila Wellington: “As women walk out the door after years of training, what really walks out is the potential that those women would have brought to Corporate America.”
Co-sponsored by the National Foundation for Women Business Owners (NAWBO), the Committee of 200, and Salomon Smith Barney, the Catalyst research revealed that:
- One third of the women surveyed felt they weren’t taken seriously by their employer or supervisor.
- 58% reported that nothing would attract them enough to return to the corporate world.
- 24% said that they could be lured back by more money
- 11% said they could be lured back by greater flexibility
The sad reality is that Corporate America isn’t doing enough to prevent women executives from walking out the door. Companies need to focus on providing flexibility, opportunities for personal growth and continuing challenges if they are to retain women they view as high-potential or who are already significant contributors. In addition, companies need to identify potential women managers early in their careers, and recruit entrepreneurs to senior level positions and corporate boards.
Expanding leadership opportunities for women requires a shift in corporate cultures as well as some “give” by women themselves if true change is to take place. Corporate cultures need to support initiatives that give women high-visibility assignments, hold managers accountable for women’s advancements, and make gender diversity a mandatory part of succession planning.
Women executives can beef up their leadership development by taking on high-profile assignments that carry an element of risk, and should consider investing in coaching services in order to refine their leadership skills – something that will help them excel whether they choose to remain in a corporate setting or venture out on their own.