The Gender Wage Gap: Why It’s Not Gone Yet

Business.com / HR Solutions / Last Modified: February 22, 2017

Equality in the workplace has not yet been accomplished. These are the changes we need to make to see the gender wage gap disappear.

Thirty years ago, working women earned $.64 to every dollar earned by their male counterparts.

That amounted to a $.36 pay gap between genders. Since then, more women have been pursuing higher education and executive roles, the marginal gap has shrunk. Now, according to Pew Research estimates, women earn $.84 to every dollar earned. 

That deserves a pat on the back of Civil Rights (and a round of applause for women). We’ve made strides in closing a substantial societal fissure. But it’s still not good enough.

The gender pay gap still exists and steps need to be taken in order for incomes to be even-handed. And here’s why it matters: 63 percent of families in the U.S. rely on a working mother to make ends meet. At the same time, 40 percent of families with children under 18 are dependent on female breadwinners. Inadequate wages for women is more than a matter of gender. It’s a family issue. 

A single sweeping solution will not obliterate the divide, but many tiny steps will. Here are a few options that will help establish gender equality in the workplace.

Related Article: Women-Owned Businesses Are Less Likely to Exceed $1M in Sales. So What?

Establish Better Work Life Balance

With each new generation of men and women entering the workforce, the pay gap is small and then gradually grows throughout the years. Why is this? In a society where time means money and more hours devoted to the work week equals more bountiful paychecks, the scales have tipped in favor of the man.

According to Pew Research:

  • Almost 40 percent of women say they have taken a significant time off of work to care for children or a family member
  • 42 percent have reduced their hours
  • 27 percent say they have quit altogether to care for someone else

More time in the office is rewarded, and women who take time off to care for others see diminished rewards.

When women decide to return to the workforce, many experience the “maternity penalty,” especially in time-demanding corporate jobs like law and healthcare. Among female Harvard students graduating in 1990, those who took 18-months off, MBAs saw a 41 percent earning penalty, lawyers saw a 29 percent penalty and doctors endured a 15 percent penalty. Employers are also less likely to hire mothers than childless women. On the other hand, when men have children, they often are congratulated with a wage premium.  

The pay gap is inextricably linked to childbearing. So how to do we help working mothers balance both necessities? According to Harvard economist Claudia Goldinand and Facebook’s Sharyl Sandberg, companies should encourage more work flexibility and autonomy, finding ways to reward employees based on irregular schedules (i.e. work-from-home moms).

Abbott, the healthcare company located in Illinois, is building a culture to support working caregivers. They offer flexible working schedules, telecommuting opportunities, on-site day care, discounted childcare options, and stress-management counseling.

Related Article: Master the Art of Hiring with These 5 Tips

Start the Solution Early

The pay gap cannot be blamed solely on gender discrimination nor inflexible work environments. Young women disembarking on careers still only earn $.93 to every dollar earned by their same-status male counterparts.

Why the initial gap? It can partly be explained by choice of college major and type of careers pursued after graduation. Women tend to go into teaching or administrative office jobs, where they earn $14.78/hr on average in comparison to the $30/hr male-dominated jobs in science and engineering. 

In the past couple years, the Obama administration have ramped up efforts to construct a route to high-paying jobs for young girls, geared towards STEM-related careers especially. Women in science, technology, engineering or math-related occupations earn 33 percent more than those in non-STEM jobs.  Non-profits like 100Kin10 aim to train and retain 100,000 STEM teachers by 2021 and US2020 that matches STEM mentors to girls of all ages to inspire discovery and innovation.

Teach Women to Negotiate

A study of Carnegie Mellon MBA students showed that male graduates were paid $4,000 on average more than their female contemporaries because they were eight times as likely to negotiate a higher salary. Women tend to accept initial offers in fear of seeming bossy or dominating, and because of that, miss out on potentially higher wages.

Colleges and universities have created salary-negotiating workshops to teach soon-to-be female graduates how to negotiate effectively. “Students exiting college need to have an understanding of how the wage gap affects them personally,” Erin Lovette-Coyler, director of the University of San Diego’s Women’s Center told UT San Diego.

To avoid this issue, some companies have nixed negotiation. Reddit doesn’t allow for negations. They allow a swap between salary compensation and equity in the company, but nothing else. “We aren’t going to reward people who are better negotiators with more compensation,” Pao told the Wall Street Journal.

Related Article: Defining Success: What Do Age & Gender Have to Do With It?

Change Job Descriptions

Sometimes small solutions have the greatest consequence. Shelly Zalis, the CEO of Ipsos OTX and the founder of the Ipsos Girls Lounge is an advocate of gender equality and a balanced corporate culture.  

During one of her Ipsos Girls Lounge events at the 2015 CES in Vegas, Zalis offered a seemingly minor solution with drastic effects: change the job descriptions.

Executivelevel job requirements posted to sites like Monster.com and LinkedIn tend to include adjectives unnatural to most women. “Reread your job descriptions. A lot of the time they list required qualities like aggressive or assertive,” Zalis said. “Women want to be strong, but sometimes the language is wrong and scares off women.”

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