Report: Supporting more women in STEM part of adding $150 billion to Canada’s GDP by 2026

The McKinsey Global Institute (MGI), the research arm of McKinsey & Company Canada, has released the results of a new study examining women’s equality in Canada’s workforce.

The report, The Power of Parity: Advancing Women’s Equality in Canada, surveyed 69 Canadian companies that represent over 500,000 employees to examine the potential benefits of tackling gender inequality at the national, provincial, territorial, and municipal levels, as well as shed light on the barriers women face in the workplace.

A key takeaway from MGI’s report is that advancing women’s equality in Canada has the potential to add $150 billion to GDP by 2026, a 0.6 percent increase each year for the next decade. As a comparison, the report states that this is equivalent to “adding a new financial services sector to the economy.”

To paint a clear picture of the current situation in the Canadian workforce, MGI’s report breaks down the barriers women face in the workplace, and also provides statistics of women’s representation across a variety of sectors.

The report found that women make up approximately 45 percent of all entry-level employees, but only 25 percent of vice-presidents and 15 percent of CEOs. In addition, women represent only 20 percent of small business owners, and men are four times more likely than women to have a majority ownership of a small or medium-sized enterprise.

“Women’s representation in the labour force, in high-quality STEM occupations, in management, and among business owners has either improved minimally or not improved at all.”

“Canada is among the global leaders on gender equality, but its progress has stalled over the past 20 years, especially in the workplace,” said Andrew Pickersgill, managing partner at McKinsey & Company Canada. “For instance, women’s representation in the labour force, in high-quality STEM occupations, in management, and among business owners has either improved minimally or not improved at all. At current rates, these gender gaps would take three decades to almost two centuries to close. Narrowing gender gaps at work and in society is a $150 billion opportunity and one of the biggest levers of growth that Canada has today.”

When it comes to science, technology, engineering, and mathematics (STEM), women represent only 28 percent of STEM graduates and only 23 percent of STEM workers in Canada. More specifically, there are three women for every 10 men in a STEM career.

In order to overcome the gender equality in STEM fields, the report suggests several initiatives that are important to pursue including removing barriers against women participating in STEM fields, as well as enabling more women to be entrepreneurs.

“Canada has significantly fewer female than male entrepreneurs,” the report reads. “This may be due to female entrepreneurs’ relative lack of experience and confidence in their abilities or difficulties in gaining access to funding, or a combination of both. Initiatives that focus on enabling female entrepreneurs by providing targeted support in these areas could increase the number of successful majority-female-owned SMEs.”

When it comes to actually adding $150 billion to Canada’s GDP, the report stresses the need to increase labour force participation, as well as encourage more women to join high-productivity sectors like technology. Each of these actions would account for 42 percent of the impact, while another 16 percent would come from increasing women’s work hours.

“Corporations, governments, non-profits, educational institutions, and individuals all have a role to play in achieving this,” the report reads. “Together, they will need to break down the economic and social barriers that prevent women from participating fully in STEM fields, entrepreneurship, and politics.”

“Canada has significantly fewer female than male entrepreneurs.”

The report also states that to see $150 billion growth in GDP, Canada would need to add roughly 600,000 net new jobs for women, stressing once again that as new technologies emerge across a variety of high-productivity sectors, numerous types of jobs could be created in order to meet these targets.

“Emerging technologies such as GPS surveying, automated loading and transportation, and robotics are not only increasing productivity in these sectors, but also creating opportunities to involve more women,” the report reads. “Such technologies often rely more on transferable functional skills and less on sector expertise. This skill set, would allow people, including women, to move more freely across sectors and into these higher-productivity ones.”

MGI’s report stresses that Canada can also increase women’s employment in “sectors of the future,” which include aerospace and rail, information technology and system design, and engineering and businesses services — sectors that would not only create opportunities for women engineers and scientists, but also potentially add about 150,000 to 200,000 jobs over the next 10 years and increase Canada’s competitiveness in the global market.

Overall, MGI’s report provides an overview of what the Canadian government, nonprofit organizations, corporations, and educational institutions need to do in order to eliminate gender inequality, as well as realize a $150 billion GDP.

The report provides a holistic set of initiatives that key players can implement to drive progress, which include going beyond a vocal commitment to diversity, setting targets and tracking performance, creating formal sponsorship programs to help promote women, and raising awareness of and combatting unconscious bias to create an inclusive environment in the workplace

“This research highlights best practices in Canadian companies that others can emulate,” said Sandrine Devillard, senior partner at McKinsey’s Montreal office. “But initiatives need to be implemented holistically and effectively, and measures to tackle gender imbalance in companies only work if they are considered to be a true business imperative. Changing attitudes takes time, and persistence is vital.”

View the full report here.

Amira Zubairi

Amira Zubairi

Amira Zubairi is a staff writer and content creator at BetaKit with a strong interest in Canadian startup, business, and legal tech news. In her free time, Amira indulges in baking desserts, working out, and watching legal shows.