The Gender Wage Gap: More Complex Than It Looks

wagegap-blogAt the end of a 19-year career at Goodyear Tire and Rubber Company, Lilly Ledbetter found that she was making significantly less than her male coworkers, and legal action ensued. The result was the Lilly Ledbetter Fair Pay Act of 2009—the first bill signed into law by President Obama—which states that the 180-day statute of limitations for filing an equal-pay lawsuit begins anew with each paycheck impacted by an act of discrimination.

While Ms. Ledbetter’s situation involved blatant, ongoing discrimination, there are other reasons for the gender wage gap. Career choice is one reason. According to the 2009 Georgetown University Center on Education and the Workforce American Community Survey, the major with the highest concentration of women was Early Childhood Education, while the major with the highest concentration of men was Naval Architecture and Marine Engineering. According to the study, the median annual salary for early childhood education was $36,000 and $82,000 for naval architecture and marine engineering. The more common occupation of petroleum engineer showed median earnings of $120,000 for men but no reported earnings for women because “the sample size was too small to be statistically valid.”

These differences are striking and suggest that if women just chose different careers, there wouldn’t be a wage gap. The Georgetown survey found that for Pharmacy, Pharmaceutical Science, and Administration majors, median annual earnings were $100,000 for women and $110,000 for men. A closer look reveals a consistent pattern of women earning less than men in the same field of study. Sometimes, as in the example above, the difference isn’t dramatic. But in other areas, the differences are more glaring. For example, in Computer Engineering, women earned $67,000 annually compared to $80,000 for men.

So besides choice of career, what else is driving the wage gap? According to a 2014 article in U.S. News, work-family choices also play a role, as women tend to work fewer hours and interrupt their careers more frequently than men. The inference is that women’s choices have led to the wage gap.

But looking more deeply into the issue reveals that women are less likely to receive an early promotion to a managerial role, so the path to senior-level positions and leadership becomes more difficult. Women in the Workplace 2016, a recent study by Leanin.Org and McKinsey & Company, found that women remain under-represented at every stage in the corporate pipeline.

This study suggests some actions human resources professionals can consider to help level the professional playing field. Establish clear job descriptions before considering anyone for a promotion or a new professional opportunity, so every candidate can be measured against objective criteria. As succession plans are developed, provide opportunities for all employees with high potential to have access to senior leaders. Encourage senior leaders to become mentors to promising employees of both genders. Finally make sure that compensation systems are not unintentionally biased. No one wants a repeat of what happened to Lilly Ledbetter at their organization.