group of women / Denis Novikov

This article appears in the March 2022 issue of Advisor’s Edge magazine. Subscribe to the print edition, read the digital edition or read the articles online.

Various reports over the past two years have described a “she-cession,” outlining different ways the pandemic’s economic effects have been disproportionately borne by women. A recent U.S. study suggests financial advisors are no exception.

Female advisors have reported greater increases in stress than their male colleagues since the onset of Covid-19, according to a paper published last fall in the journal Financial Planning Review. This included more work-related stress, greater stress from family responsibilities and higher levels of what the authors called “empathetic stress” — the burden from witnessing the pandemic’s effect on their clients.

The authors — three U.S. academics and financial planner Michael Kitces (see below) — surveyed 499 U.S. financial advisors from August to October 2020, when markets had rebounded from the sell-off in March but before vaccines were developed. Kitces, a well-known industry voice through his Nerd’s Eye View blog and The Kitces Report newsletter, conducted the survey through his website.

While both male and female advisors reported a “significant increase” in work-related stress, the effect was greater among women, and so was the negative impact on life satisfaction. One reason could be that women reported higher levels of stress from managing family and other responsibilities unrelated to work.

Interestingly, reduced income and working outside the normal office weren’t considered significant stressors for women or men.

The authors noted that other research has been split on how Covid-19 has affected household labour and domestic responsibilities; some studies have shown that men have taken up a greater share while working from home. However, among the advisors surveyed, only women experienced family responsibilities as a substantial personal stressor, “and this had a significantly negative impact on their well-being,” the paper said.

The authors also found differences in how male and female advisors responded to the impact of Covid-19 on clients. Both men and women reported experiencing stress on behalf of clients “at levels above a neutral midpoint,” the paper said, but the effect was greater among women.

The finding isn’t surprising, as the authors pointed to previous research (and cultural stereotypes) suggesting women’s superior empathy. The characteristic has many benefits. For example, the authors cited research that found the perceived empathy of salespeople predicted banking customers’ relationship quality ratings. Empathy may be an important quality for financial advisors for the same reason.

But there’s also a potential cost: “[F]inancial advisors who engage with a high degree of empathy are at risk of suffering from stress and burnout,” the paper said.

That women reported higher levels of empathetic stress poses a potential risk for an industry that’s already male-dominated. (Consistent with industry demographics, the sample used in the study was disproportionately male — 75.4%, versus 76.8% among U.S. certified financial planners.) If women are suffering from burnout at a higher rate, they may also be more likely to leave the industry. The authors suggested that more thought about developing interventions to alleviate this type of stress is warranted.

The authors also pointed to research that may help explain women’s greater stress and domestic burden: women are more likely than men to spend their time off engaged in domestic labour. “If family-friendly time given to employees is going to be used in a gendered manner that does not result in equal opportunities,” the authors wrote, “then companies may wish to consider alternative benefits (e.g., paid childcare or housekeeping services) that may be more likely to free up time for employees regardless of gender.”

“Gender differences in Covid-19-related stress and relationships with life satisfaction among financial advisors” by Derek T. Tharp, Elizabeth J. Parks-Stamm, Michael Kitces and Meghaan Lurtz, published in Financial Planning Review, October 2021