This article was updated on July 17, 2018.
While social media and news coverage may make it seem as though the gender gap is a recent phenomenon, it really isn't. The U.S. Bureau of the Census has been tracking labor force participation rates of men and women as far back as colonial times. Closing the gender gap may have gotten more coverage lately, but that gap has become steadily smaller over the last 110 years.
Different sources report different percentage points when it comes to how much women still lag behind men. According to the Society of Human Resource Management, women earn 82 percent of the median weekly earnings of full-time male salaried workers. According to a White House brief, that number is 78 percent.
What's Been Done
The federal government has passed laws such as The Equal Pay Act of 1963 and Title VII of the Civil Rights Act of 1964, and a number of states have passed their own legislation, according to the National Conference of State Legislatures. It's been up to organizations, however, to install and enforce policies and institute practices that take those laws further to fully close the wage gap.
2 Things That Can Be Done
1. Public Wage Information
Some organizations, like midsized marketing platform Buffer, started closing the gender pay gap by making all employee compensation information public.
With pay transparency, colleagues know what everyone earns. Women and other non-white male employees know when they're making less than their white male counterparts. The "why" would be another matter. There could be differences in education, experience, proficiency, employment gaps, etc., that affect the dollar figure. This practice may serve as an impetus to increase productivity by establishing a corporate meritocracy; those who produce the most are paid the most.
2. Eliminate negotiation
According to a study by Salary.com, women are less likely to negotiate a higher salary for themselves. A survey from the study points out, "46 percent of men always negotiate salary following a job offer, compared to just 30 percent of women. And while 39 percent of men are apprehensive about negotiating, that number jumps to 55 percent for women."
A Forbes article explains how a single negotiation can have a ballooning, deleterious impact. The article presents a scenario with an equally qualified 22-year-old man and woman who each get $25,000 job offers. The man negotiates his starting salary up to $30,000, and the woman accepts the original offer. Both get three percent raises every year until age 60, and neither negotiates more pay raises.
"By the time they reach 60, the gap between their salaries would have widened to more than $15,000. If he put his additional earnings in a savings account earning 3 percent interest, he'd have $568,834 more than his female counterpart at retirement — all because of that one negotiation. Some have argued that the entire gender pay gap can be explained by men's advantage in negotiation."
Ellen Pao, former Reddit CEO, told San Jose Mercury News in 2015 that her company doesn't do salary negotiations anymore. The reason? "Just because one person is a better negotiator does not mean they should be paid more than another person with similar experience performing a similar role." Instead, Reddit gives two options: higher base salary or higher equity.
Eliminating negotiation and practicing pay transparency won't solve everything. Affordable childcare, biases in hiring and promotion, networking difficulties and mentoring relationships are all contributing factors, as well. The two initiatives above, however, are a great place to start for organizations that want to be at the forefront of closing the gender gap.
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