The economic impacts of the pandemic threaten to undo years of progress towards equality. In December 2020, 140,000 women in the US lost their jobs while 16,000 men were newly employed. Unemployment rates for women rose at a greater rate than for men in Australia, India, Canada, China, the Philippines, Brazil – and virtually every other economy where reliable statistics are available.
Even if women retain their jobs, they are more likely to face pay cuts, reductions in paid hours or worse working conditions.
Inequality has increased
The same shocking trends apply to the other major vectors of disadvantage: race, class and existing wealth. In every country in the world, income inequality has increased markedly during the pandemic, with people of colour disproportionately hard hit.
Oxfam has estimated that it will take more than 10 years for the incomes of the poorest populations to recover, while the incomes of the top 1,000 wealthiest people have already recovered or surpassed previous levels.
Declarations of commitment to equality will not be enough for purpose-led companies to maintain their stakeholders’ trust in such a world. As employers, companies have significant opportunities to influence new social models that address these entrenched inequalities.
A question of value
One lever for change is to reconsider how work is valued. The traditional method – reliance on market benchmarks – automatically replicates existing pay disparities. Rather than asking ‘what is the least we can pay for this role?’, consider the question ‘what is this role worth to us?’. What risks does the role address, what value does it create, and how do these relate to our purpose?
This approach enables the consideration of long-term sustainable value creation in determining what different functions contribute to your company. Consulting your employees, customers and other stakeholders can help you to understand those contributions more deeply and to build engagement in the practical application of your organisation’s purpose. Continuing consultation can also allow for job valuations to be tweaked as circumstances or priorities change.
Rather than asking ‘what is the least we can pay for this role?’, consider the question ‘what is this role worth to us?’
Opening the conversation about the value of work has concomitant benefits for corporate performance. Greater transparency on what is paid, and why, has been proven to build employee engagement and to support a culture of collaboration and productivity. Employees are better placed to understand how they and their colleagues contribute to the larger whole, and tend to act accordingly.
The same approach should also be extended to working conditions more broadly. The burdens of childcare and unpaid work in the home are well-proven drivers of inequality. Changes to practices brought about by the pandemic – particularly working from home, flexible hours and greater recognition of the demands of caring for children, the elderly or sick – must not be wound back in a post-pandemic world.
Where the need for flexibility has been used as an excuse for creating job insecurity, however, this should be re-examined. Our experience of Covid-19 has shown that flexibility can be a characteristic of all work without necessitating a drop in security.
Of course, governments, customers and markets play a part by supporting sustainable value creation and disincentivising unsustainable practices. The imperatives to do so are becoming starker by the day. Companies have an opportunity now, as we begin to see the light at the end of the tunnel, to align themselves to a more equitable and meaningful future.