Tomorrow, April 4, is Equal Pay Day: the symbolic day where we raise awareness of the gender pay gap by marking how far into the year women must work in order to earn what men earned in the previous year.
Some people may be tired of hearing about the gender pay gap or wonder why we should even continue talking about it since we all know it exists. Isn’t it enough to know that it exists? Do we really need to keep talking about it?
When talking about problems of this magnitude (it has the potential to add $12 trillion to the global economy by 2025), it can be easy to forget the impact that the solution to this problem would have on our lives. Unfortunately, this is a problem that many of us face each day - and if we don’t continue making strides, we’ll all be on the losing end.
Need more of a reason to continue the conversation? Here are 5 reasons why everyone needs to keep talking about equal pay:
Change is slow and it won’t go away on its own.
The pay gap currently stands at 20%. This means on average women working full time in the US were paid just 80% of what men were paid. While that is a large gap, what’s more alarming is that the rate of change has slowed. We saw large strides in the narrowing of the pay gap from 1960 - 2000, largely due to women’s increase in education and participation in the workforce, but the rate of change has significantly slowed this century. The number of women earning bachelor’s degrees is greater than that of men, but that’s not helping to narrow the gap like it used to. If change continues at the slower pace we’ve seen from 2001 - 2015, women won’t reach pay parity until 2152.
We ALL need to know that it’s OK to ask for more.
Critics will say that the simple solution to the wage gap is to have women negotiate. Unfortunately, women are stuck in a precarious situation. Ask for more and studies show you risk being seen as ungrateful or pushy. Don’t ask and you could miss out on over $1 million in earning over your lifetime.
Fortunately, there has been great research done to help women understand how to negotiate without facing the social cost of negotiating. But for equal pay to really be within our grasp, the people who we are negotiating with need to also be aware of their unconscious bias against women negotiating and acknowledge that it’s OK for women to ask for more.
Because any gap is a big gap.
Some gender pay gap naysayers like to point to the nuances in the widely cited statistic that women make 80 cents for every dollar men are paid. When controlling for education, race, and profession, there are some instances where the gender pay gap can decrease to 5%. While 5% is certainly much better than 20%, the impact on earnings over a lifetime is startling. A 5% wage gap can mean that women are losing out on hundreds of thousands of dollars over their career.
Stanford Professor Margaret Neale gives an example of the impact this can have on earning power: two people receive a job offer of $100K and one person is able to negotiate that offer up to $107K, which may not seem like a big difference at the time. But if those two people are given the same raises and promotions over a 35-year career, the person who didn’t negotiate will have to work for an additional eight years to be as wealthy as the person who negotiated an additional $7K at the beginning of their career.
Because it’s about more than just pay.
For things to be truly equal, more than just pay needs to be equal. To put women on a level earning playing field, women and men must share household and caregiving responsibilities equally. Working women are more likely to take time off, work reduced hours, or forgo a promotion to juggle home life and work life. According to research from the Bureau of Labor Statistics, working moms pick up more childcare and household duties than men - approximately an extra 75 minutes per day, when both spouses are working full time. The more we continue to talk about equal pay, the more we will understand what equal work, inside and outside of the workplace looks like.
Because (well-paid) female leadership is good business.
Having women ascend to leadership positions isn’t just a nice to have, it’s good business. A 2015 study done by MSCI found that “Companies in the MSCI World Index with strong female leadership generated a Return on Equity of 10.1% per year versus 7.4% for those without.”
Though it is good business to promote women to leadership positions, many women cite the reason they leave their current position is to earn more money elsewhere. If companies could focus on retaining the women they have through paying them fairly, and moving them up the corporate ladder, we could see a more diverse group of business leaders at the top, which has been shown to benefit the bottom line.
So go on. Talk about equal pay this payday and every day.
Through her consulting company, The Worth Project, Erica helps women think strategically about their career, their brand, and their negotiation conversations so they can get recognized and rewarded in a career that they love. She has a weekly column for Forbes and has been featured in other sites such as The Everygirl and DailyWorth. Erica has her MBA from Duke University and her BA in economics from UCSB.
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