7 Reasons for the Gender Pay Gap

Pay wage gap7 Reasons for the Gender Pay Gap.

The U.S. Department of Labor and the Census Bureau have long tracked earnings of men and women. These earnings are broken down in a number of different ways according to race, ethnicity, age, occupation, and educational attainment.

The overall gender pay wage gap stands at 79 cents. What this means is that women earn 79 cents for every dollar that men earn across all occupations. The median annual earnings of full-time, year-round workers in 2014 (the most recent data) were $50,383 for men, and $39,621 for women. This represents a gap of 21 percent.

What I find most interesting is the gap in the 3 most common occupations for women. In order, they are secretaries/administrative assistants, elementary/middle school teachers, and registered nurses. Even in these female dominated occupations, men make more than women!

Here’s the pay wage gaps:

  • Secretaries and administrative assistants = 85 cents
  • Elementary and middle school teachers = 87 cents
  • Registered nurses = 90 cents

What’s even more depressing, is that in none of the top 25 most common occupations for women, do women earn more than men. Not one.

So, why is there still a pay wage gap? Here are 7 key reasons.

  1. It’s historical. Women have historically been paid less than men across all occupations for decades. Some people are still stuck in these traditional mindsets, and whether their behavior is conscious or unconscious, they offer women less money than men.
  2. Lack of transparency. We can’t address a problem if we can’t see it. If you have no idea how much your colleagues are making for the same job that you do, then how would you know there’s a pay gap? More companies need to be transparent about their salary ranges for each position, so individuals can at least know if they are within the appropriate range. Another thing organizations can do is perform salary audits with regards to gender and make changes when there’s a discrepancy.
  3. Gender bias. It’s no surprise to most of us nowadays that bias is everywhere. Whether we are aware of it or not, we all have biases that affect the way we interact with others. These biases impact the way we make hiring and salary decisions.
  4. Lower starting salaries. Women generally have lower starting salaries then men in their first jobs right out of college. Part of this is due to the reasons discussed above, and part is due to differences in how we negotiate. Since women start out with lower salaries, each incremental salary bump will be lower. For example, if a woman’s salary is $25,000 and she receives a 10% bump for her next job, she makes $27,500. If a man’s salary is $35,000 and he also receives a 10% bump, he makes $38,500. The initial $10,000 gap between the two has now jumped to $11,000. And this is only one job. Multiply it over the course of a career and it adds up to hundreds of thousands of dollars less for women.
  5. Negotiation skills. When it comes to negotiation, there are some gender differences. In general, women negotiate cooperatively, and men negotiate competitively. Women focus more on relationships and try to achieve win-win outcomes for both parties. Men focus more on economic measures that have win-lose outcomes. In addition, because women often value relationships more than economic outcomes, they tend to settle more for the first offer more than men without haggling for more money, vacation, benefits, or whatever.
  6. Women are valued less. Historically, women have been seen as less important than men socially, economically, politically, legally, and culturally. Thus, they have a smaller gender footprint than men. Simply put, this is the environmental, economic, social, and political impact men and women have purely because they are male or female. In most cultures, men have a much larger footprint than women. This gives men much greater power. This power is often used over women and leaves them disempowered. When women have a larger and stronger gender footprint, families, communities and societies at large benefit.
  7. Because they can. This is perhaps the worst reason on the list. I’ve heard people say many times, if you want to save money, hire a woman. Too many organizations today still think this way. They pay women less because they have gotten away with it. No one sees what they pay their employees, they don’t conduct salary audits, and no one is holding them accountable. This lack of transparency and accountability must change. We need to start demanding it from organizations, and we need congress to develop stronger policies regarding equal pay.

What’s important about the pay wage gap is the message it sends. Companies all over the globe are consistently telling women the same message—you are valued less than men. That’s the bottom line.

Despite how much a woman may contribute to her company, her years of experience, her skills and competencies, or even her position, the message is the same and it comes across loud and clear. It’s no wonder many women are so passionate about this issue. How would you feel if you found out that you were paid $20,000 less per year than a peer you work with every day?

Individuals, organizations, society as a whole, and the government all contribute to the gender pay gap. And, it’s these same groups that are responsible for closing the earnings gap so that we have equal economic opportunities for everyone.

To learn more, go to my website at drshawnandrews.com.  Or, check out my book titled, “The Power of Perception: Leadership, Emotional Intelligence, and the Gender Divide”.