You may have heard the statistic that women earn 70 cents for every dollar a man earns. Is it women’s choices that drive the pay differential? Do women earn less than men earn mostly because men never step off the ladder -- their wives do? It’s not that simple.
Salaries between men and women are fairly equal during our 20s. As we get into the career-building years of our 30s, many women opt out of their careers, and earnings start to diverge.
Our data show that women lose an average of 18% of their earning power when they take an off-ramp. In business sectors, penalties are particularly draconian: in these fields, women's earning power dips an average of 28% when they take time out. The longer you spend out, the more severe the penalty becomes.1
However, the GAO calculated in 2003 that 20% of the pay differential has nothing to do with women’s choices and has everything to do with —you got it — discrimination.2
So – yes – part of the pay differential has to do with women’s choices. But, think about it: why is it women who step out of the workforce in the first place? Even though salaries are close between women and men in our 20s, women still get paid, on average, 6% less.3 So when a family has to make the choice about who stops working to care for a child or elderly parent, the numbers often drive the decision.
So, what’s a girl to do? It’s pretty simple.
- If you’re thinking about taking time off from work, stay in the game. Schedule phone calls and lunches with your former co-workers and go to industry events. If you plan to change careers, use your time off wisely. Network. Research. Read. And invest. It’s not just your current earnings that take a beating; it’s your retirement portfolio as well.
- If you’re a working woman, negotiate! Put together a list of your accomplishments, schedule a conversation at review time and ask for more money. It’s likely that you’re underpaid.
- If you’re in management, look at your teams. Are they being paid equally across gender lines? If not, why? Equal pay is the law. The Equal Pay Act of 1963 mandates equal pay for men and women employed in the same or substantial similar jobs.
- When you vote (and I assume you do), support the campaigns of those who support pay equity. More women than men vote, so issues that are important to us are important to our elected officials.
- Talk about the issue - find out if your peers know the how pervasive pay inequity is in the US. If they don’t, educate them.
…the number of women with graduate and professional degrees is projected to grow by 16% over the next decade, which the number of men with these degrees is projected to grow by a mere 1.3%.4
In other words, as the boomers start to retire, the most qualified young workers will be women. As any starlet can tell you, when you’re the talent, ask for what you want and you’ll get it.
1. Hewlett SA, Luce CB. Off-ramps and on-ramps, keeping talented women on the road to success. Harvard Business Review, March 2005, p. 4.
2. The Paycheck Fairness Act: Helping to close the wage gap for women. Washington, DC: National Women’s Law Center, April 2006, p. 2.
3. Highlights of Women’s Earnings in 2002, US Department of Labor, Report 972. Washington, DC: Bureau of Labor Statistics, September 2003.
4. Hewlett SA, Luce CB. Off-ramps and on-ramps, keeping talented women on the road to success. Harvard Business Review, March 2005, p.10.
Allison Hamilton-Rohe currently works in medical education in New York City. She lives in New Jersey with her husband, toddler and dog.