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Wall Street’s “huge and persistent” gender gap continues to befuddle the best laid plans for achieve something at least approximating gender equality in finance. We’re supposedly far beyond the days of rank harassment and sexism, yet women continue to underperform–earning less, leaving more and less frequently rising to the top of their banks and brokerages–when compared to men. This continues despite of some truly incredible efforts on the parts of Wall Street institutions to recruit, retain and promote women.
“The most annoying thing about all of this is that it strikes against the idea of a meritocracy. We’re always taught that if you work hard and have a good education, you can transcend everything. Why is progress at a standstill?” Heidi Moore of the Wall Street Journal asked recently.
After the jump, we explore the age old question: What do women want?
But the problem of the lack of women on Wall Street is hardly new. It was raised as part of a 1930 banking symposium, according to Time Magazine. “Last week the smart Plaza Trust Co., Manhattan, held a symposium on banking at which a speaker estimated that 41% of U. S. wealth belongs to women,” Time reported. “Since many a woman prefers womanly advice. Wall Street brokers noted the figure with interest, wondered if the number of women in finance will increase.”
The standard explanations are well-known. Persistent and perhaps subconscious discrimination, stigmatizing women with families, minimal family-leave policies and pressure from friends and family to be home more often are typically cited in discussion of the gender gap. More rarely raised–perhaps because just raising it can open you to discrimination lawsuits–is the possibility that the gender gap would persist regardless of outside impediments.
But two new studies of a similarly striking gender gap in the fields of math and science may have implications for Wall Street. The studies suggest that an important part of the explanation for the gender gap are the preferences of women themselves. “When it comes to certain math- and science-related jobs, substantial numbers of women – highly qualified for the work – stay out of those careers because they would simply rather do something else,” an article by Elaine McArdle in the Boston Globe explains.
Could it be that many women who leave Wall Street–or decline to show up there in the first place–are simply doing other things because they want to? The studies don’t focus on Wall Street but the findings are, at least, suggestive. Many jobs on Wall Street are heavily dependent on mathematical ability, and the same self-selection that operates in the sciences could operate in finance.
So is the progress of women on Wall Street hopeless. Perhaps not. The findings of another study–a broad survey of mathematically gifted girls and women–may suggest that women could excel in some fields on Wall Street–such as client relations at a prime brokerage desk and certain investment banking positions–that are more social.
Women who are mathematically gifted are more likely than men to have strong verbal abilities as well; men who excel in math, by contrast, don’t do nearly as well in verbal skills. As a result, the career choices for math-precocious women are wider than for their male counterparts. They can become scientists, but can succeed just as well as lawyers or teachers. With this range of choice, their data show, highly qualified women may opt out of certain technical or scientific jobs simply because they can.
The freedom to say ‘no’ [Boston Globe]