Making Pay Parity a Reality

In the United States today, women only earn 84 cents for every dollar that men earn. According to the Pew Research Center, women made rapid gains narrowing the pay gap by 13 cents in the 1980s and 1990s! However, progress has stalled and the current pay gap between men and women has stayed relatively the same for the past 15 years. We don’t yet know the impact that the pandemic will have on pay parity, but there is reason to believe it might be damaging to pay equality. Over one million roles held by women were lost in the pandemic and have yet to be regained. 

At our current differential in pay, women would need to work an additional 42 days each year to earn the same that men do. Yet, women are already working more than men. Data shows that while men work more paid hours, women are working more unpaid hours managing households. There are a variety of factors that contribute to gender pay disparity. On one hand, there are some roles where men are paid more for the same work that women do. In addition to this, women also make less money because they aren’t granted the same opportunities as men, including being overlooked for a promotion, being passed over for critical work assignments, and receiving less mentorship and support from senior leaders than men do. This is exacerbated by the fact that women have more gaps in their working history than men do. Even when those work gaps are controlled across gender, women face more negative consequences than men do.

What can your business do to improve pay parity?

First, you should know what your starting point is. What we measure and track is the piece that gets focused on. Begin by calculating the demographics (gender, race, ethnicity, and ability) of your team. In the aggregate, compare how fairly employees are compensated. Ensure that you measure how this may change across different levels of employment. This should help you uncover inequitable pay differentials so that you can make necessary adjustments. 

In addition to tracking pay parity across roles, assess the representation you have in each level. Track the points in progression where women and people of color may be losing representation. Ensuring equal pay for the same work is only one part of the solution. We must also ensure that we have equitable representation across all roles, especially in senior management. 

Once you’ve worked to ensure your pay is fair, implement a pay transparency policy. Research from Payscale shows that even when women and people of color negotiate their pay and ask for raises, they are awarded less money than white men in the same roles. When pay policies are vague or managed by individual managers, it allows bias to influence decisions. Developing a transparent process for all roles helps to ensure that all team members are compensated fairly. 

On our currency trajectory, it will take 61.5 years for women to reach economic parity with men in the United States. When we work to ensure our organization has pay parity, we can intervene to make pay parity a reality.