Family Policies Affect Business Starts

How Gender Can Alter Career Paths

Organizations generally look to factors like experience when picking a new CEO, and their boards also tend to look for faces they recognize, which can affect the gender or ethnicity at the top of Fortune 500 companies. A new study by Sarah Thébaud, an assistant professor in UCSB’s sociology department, examined the quantity of women who started companies in 24 countries. In that respect, the U.S. is among the leading nations that count numerous women among its entrepreneurs. But Thébaud’s study, published in Administrative Science Quarterly, looks deeper to see why the 43 percent of women managers, legislators, and senior officials in the U.S. in 2000 hasn’t translated to any more than the 28 percent who lead private firms.

Sarah Thébaud
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Courtesy Photo

Sarah Thébaud

The rate at which women started their own business had a relationship to what perks, such as child care, paid leave, and the availability of part-time work post-childbirth, were available. These benefits have the ability to resolve work-family conflicts, responsibilities that still most often fall to women as the primary family caretaker. Employers reward employees who can work long and unpredictable hours, and once children come into the picture, family responsibilities affect that dynamic for men and women alike. Women’s tenure in business is greatly affected by children, and they drop out of the workforce, change jobs or occupations, or reduce their hours as a result. This compromises their long-term career prospects, Thébaud wrote. The alternative of starting a business can offer greater flexibility in terms of scheduling, hours, and location for women, but can also carry a downside.

The study found that women tended to remain with their employer when policies supported them with paid leave, child care, and part-time work. Those countries also counted the fewest women in management. When women did start companies, they were profit- and growth-oriented, employed more people, and offered a new or original product or service. In other words, concluded Thébaud, their companies were more like those started by men. For women in supportive countries, she found, their business plan benefited from the greater experience and social and financial capital possessed by women who’d been in the business world longer.

In countries without supportive family policies, the women-owned businesses were smaller, less growth-oriented, and provided a secondary or supplemental income. And they tended to be in competitive and non-lucrative sectors like retail, food service, and interpersonal care. The businesses were more likely to have been started in order to resolve a work-family conflict that arose when the woman had a child but her employer lacked supportive policies. This is what Thébaud calls “Plan B,” or starting a business to resolve a work-family conflict.

For women in the work world, the choices get troubling when social and cultural norms come into play, such as, is it okay for mothers to work full-time? When a society answers with publicly subsidized child care and paid leave, Thébaud stated, the message is a positive one that results in profitable businesses.

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