Ranks of Women on Wall Street Thin

Women are fading from the U.S. finance industry.

In the past 10 years, 141,000 women, or 2.6% of female workers in finance, left the industry. The ranks of men grew by 389,000 in that period, or 9.6%, according to a review of data provided by the federal Bureau of Labor Statistics.

The shift runs counter to changes in the overall work force. The number of women in the U.S. labor market has grown by 4.1% in the past decade, outpacing a 0.5% increase in male workers.

The difference is pronounced at brokerage firms, investment banks and asset-management companies.

The figures suggest that women bore the brunt of the layoffs in the recent recession. But other forces are at play. Across the economy, computers have replaced junior, back-office workers, jobs that were largely filled by women.

The ranks of women thinned even during the stock and real-estate runup from 2001 to 2006. William Rodgers III, a Rutgers University professor and former chief economist at the Labor Department, said technology likely accounts for some of the shift.

Partly as a result, young women are becoming more rare in the country's banks, brokerage houses and insurance companies. Since 2000, the number of women between the ages of 20 and 35 working in finance has dropped by 315,000, or 16.5%, while the number of men in that age range grew by 93,000, or 7.3%.

The losses are steepest for the youngest women, including those just out of college. The number of women entering finance-industry jobs at age 20 to 24 fell 21.8% over the past decade. For jobs across all industries, the overall number of women in the work force was unchanged over the same period.

That suggests young women are either not as attracted to entry-level finance-industry jobs or aren't being hired for the posts that are available.

Given recent volatile markets and much scrutiny on compensation, there are fewer incentives to stay in the business for those women who have already chosen finance-industry careers, said Grace Tsiang, an economics professor at the University of Chicago.

Ms. Tsiang theorized that these women are having and raising children rather than staying on the job.

"Women have this higher alternative value of how to spend their time," Ms. Tsiang said. "They're always perched on this edge, and if the value of staying in a high-pressure job goes down just a bit, then that might make a big difference in the number that jump."

The picture is quite different for older women who joined the industry in the 1970s and early 1980s. The number of women in the business over 55 years old has grown by 366,000, or 56%, since 1999, outpacing a 234,000 increase, or 34%, in similar-aged men.

But that longevity doesn't necessarily equate to advancement. Senior executives such as Sallie Krawcheck, head of global wealth and investment management at Bank of America Corp., and Heidi Miller, head of international operations at J.P. Morgan Chase & Co., are still a statistical anomaly.

In U.S. financial companies, only 16.8% of executive officers and only 2.5% of chief executive officers are female, according to a 2010 study by Catalyst Inc., a nonprofit focused on workplace diversity.

Wall Street isn't keen to talk about these gender shifts. A number of firms, including J.P. Morgan Chase and Lazard Ltd., declined to answer questions for this article, and some of those that responded declined to detail the male-to-female ratios of their staffs.

One that did: At Bank of America, which has almost 6,000 retail banks, 61% of the workers are women.

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The number of women on Wall Street is falling, especially younger ones. Those entering finance jobs ages 20 to 24 fell 21.8% in the past decade.

Some women who left the finance industry give this reason for their thinning ranks: The career, saddled with stress and scandal, has lost much of its allure.

Janet Hanson, founder of 85 Broads, a networking group that tries to attract women to finance, said that women are finding "their entrepreneurial groove."

"It's not because Wall Street is not a fascinating place to be, it's just that there are other places that are more fascinating," she said.

Meghan Muntean joined Lehman Brothers Holdings straight out of Princeton University in 2006, when "the markets were hot, and everyone who was anyone was going off to Wall Street." She stayed on through the firm's bankruptcy and left to start ChickRx LLC, a website for female health advice and products.

Ms. Muntean said many of her female co-workers got smaller bonuses because they didn't golf or pal around with male managing directors.

"There were a couple that tried to be buddy-buddy with the guys, but it never really worked," she said. "It wasn't like the 1960s, getting slapped on the butt all the time. It was very subtle."

Monica Murphy also became an entrepreneur, leaving Goldman Sachs Group Inc. in early 2008 to start SoleMates LLC, which makes protective covers for high-heel shoes.

Ms. Murphy said her female co-workers were more open to a broader definition of success than her male contemporaries.

"I think it's because there's pressure on women to have more than just a career," Ms. Murphy said. "The whole work-life balance thing—for men, that's not always a big deal, but for women, it's always an issue."

Many women report that sexism is still rife on Wall Street, albeit less overt. Sexual-discrimination charges by women at finance companies dropped 28% from 2000 to 2009, according to data from the Equal Employment Opportunity Commission. But the number of charges per woman in the industry climbed during the recession in 2008 and 2009.

A lawsuit filed Wednesday by three former employees of Goldman Sachs charges the firm with employing a "pattern and practice" of discrimination. It also alleges that women fill only 29% of the firm's vice-president offices, 17% of managing-director roles and 14% of partner positions. Goldman Sachs has said the case is without merit.