Women are still not asking for pay rises. Here’s why

This excerpt is from Joanne Lipman's new book "That's What She Said". The book was chosen to launch the brand new World Economic Forum Book Club. Each month, a new book will be selected and discussed in the group. The author will then join in on the last day of the month to reply to some questions from our audience.

CHAPTER 6:

She Deserves a Raise. But She Won’t Ask for It

The biggest surprise for me when I became a manager was how many men asked for a raise, a promotion or a bigger office. It came as a shock because I didn’t ask for those things myself. Neither did the women I supervised.

The first hint of this alien new world came on the day I moved out from my cubicle. I had spent my career in the open bullpen of a big newsroom. I always loved the energy and excitement and sense of shared purpose of a newsroom. Ideas, inspiration, and bawdy jokes flowed freely across those cubicle dividers. We commiserated when we’d gotten beaten by the competition, celebrated each other’s wins, rallied around each other in times of crisis. I learned my trade by osmosis, overhearing the best reporters in the business work the phones to tease information from their sources.

But in my new role as an editor, I would be dealing with confidential information like salaries and performance reviews. I would need some privacy. I was still unpacking in my new office when one of my male colleagues stopped by. Without a word, he began pacing out the perimeter.

“What are you doing?” I asked.

“Your office is two feet smaller than the other people in your position. You should complain.”

I laughed. Who cared what was the size of my office? It was big enough for a desk, and it had a door. It even had a window. I didn’t need more than that. I shooed him out and got back to work.

Little did I realize, my male colleague was on to something. The size of my office – or, more to the point, my lack of interest in it - was symptomatic of a larger issue. The other people in my position were men. And men are far more likely to advocate on their own behalf, not just for stuff I considered trivial, like office size, but for indisputably meaningful incentives like salary and other benefits. Just as it never occurred to me to push back about my office, it didn’t occur to me that I should negotiate my salary. Not surprisingly, I later learned that the men in my position, those with the larger offices, earned more than I did.

Researchers ultimately concluded what I saw for myself. Men are four times more likely than women to ask for a raise—and when women do ask, we typically request 30% less than men do, says Carnegie Mellon University economics professor Linda Babcock, co-author of Women Don’t Ask. In a study of 78 masters degree students, she found that just 12.5% of women negotiated for their starting salary, versus 52% of men. That leads, by her estimate, to as much as $1.5 million in lost income over the woman’s career. The gap is closing somewhat among younger women, who are more likely to ask for raises and are more likely to be the family’s primary breadwinner, but women are still far from parity when it comes to negotiating pay.[i] An Australian study of 4,600 employees found that while women were as likely as men to ask for raises, they were 25% less likely to receive them.[ii]

Advice books tell women that we need to demand what we deserve. The problem is, we don’t. That’s a major reason for the stubborn gender pay gap. More than a half-century after President John F. Kennedy signed the Equal Pay Act of 1963, the gap between what men and women earn has defied every effort to close it. And it can’t be explained away as a statistical glitch, a function of women preferring lower-paying industries or choosing to take time off for kids. American women earn just 82 cents for every dollar a man makes, based on median weekly income for full-time workers.[iii][LJ1] Even for young women starting out, the gap is 90 cents for every dollar. To be sure, those figures include low-paid female schoolteachers and billionaire male hedge fund managers. But when you control for occupation and experience, men still out-earn women, by a large margin. One analysis of 446 American occupations found that women earn less than men in 439 of them.[iv]

In fact, Claudia Goldin, a labor economist at Harvard, has crunched the numbers and found an especially steep gap for jobs requiring the most education [LJ2] , even after controlling for hours, education, race and age.[v] Female doctors and surgeons, for example, earn 71 percent of what their male colleagues make, while female financial specialists are paid just 66 percent as much as comparable men. In Silicon Valley, women earn 40% to 73% less than their male counterparts.[vi]

Other researchers have calculated that women one year out of college earn 6.6 percent less than men after controlling for occupation and hours, and that female M.B.A. graduates earn on average $4,600 less than their male classmates for their first jobs. A comprehensive study, Behind the Pay Gap, found that even after accounting for different occupational choices and hours worked, there was an “unexplained” wage gap of 7% for women one year out of college, a mystery gap that grew to 12% within a decade.[vii] By one estimate, the average woman needs to work 12 years longer than a man just to get to even with his earnings.

Nor is the gap fully explained by women stepping back after they have kids. Multiple studies have shown that women who don’t marry or have children face a career gap that they simply can’t overcome. A Catalyst survey[viii] that followed ambitious business school graduates in the U.S., Canada, Europe and Asia, for example, found that women who didn’t take time off still didn’t receive the same opportunities as their male counterparts. And pity those who do choose to take time for family; they are disproportionately punished. Female MBAs who leave the workforce for 18 months and then return, for example, earn on average of 41% less than their male counterparts.[ix]

The solution should be so simple. If the root causes for the gap is that women don’t negotiate, then we should get over ourselves, and just ask for what we are worth already. A whole genre of books geared to women has pushed us to do exactly that, from television personality Mika Brzezinski’s Knowing Your Value, to Nice Girls Don’t Get the Corner Office by Lois P. Frankel, to Gail Evans’ Play Like a Man, Win Like a Woman.

So why don’t we? Part of the reason is we don’t actually know what we are worth. Through a quirk of biology and culture, we undervalue ourselves. What’s more, even if we do realize our value and then ask for it, we often suffer consequences of another sort. People find us bossy, or uncompromising, or difficult. They don’t want to work with us.

It’s perilous territory to suggest that women and men are different in that way. It’s a small step toward suggesting that one is “better” and the other is “worse.” But to eliminate the gender gap, we need to recognize the fact, as uncomfortable as it may be, that men and women are wired differently. And in some ways, women are programmed from birth to value their personal contributions less.

From the book That’s What She Said: What Men Need to Know (and Women Need to Tell Them) About Working Together by Joanne Lipman. Copyright © 2018 by Surrey Lane Media, LLC. Reprinted by permission of William Morrow, an imprint of HarperCollins Publishers.

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Footnotes:

[i] Page 139: “The gap is…” Artz, Benjamin, Amanda H. Goodall, Andrew J. Oswald. “Do Women Ask? Warwick Economics Research Papers, No: 1127. July 2016, http://www2.warwick.ac.uk/fac/soc/economics/research/workingpapers/2016/twerp_1127_oswald.pdf

[ii] Page 139: “An Australian study…” Cohn, Laura. “Women Ask for Raises As Much As Men Do—But Get Them Less Often.” Fortune, September 6, 2016, http://fortune.com/2016/09/06/women-men-salary-negotiations/

[iii] Page 139: “American women earn…” United States Department of Labor. “The Economics Daily,” March 8, 2017, https://www.bls.gov/opub/ted/2017/womens-median-earnings-82-percent-of-mens-in-2016.htm

[iv] Page 139: “But when you control…” Overberg, Paul, Janet Adamy, Lam Thuy, Jessica Ma. “What’s Your Pay Gap?” The Wall Street Journal, May 17, 2016, http://graphics.wsj.com/gender-pay-gap/

[v] Page 139: “ In fact, Claudia…” Goldin, Claudia. “A Grand Gender Convergence: Its Last Chapter.” American Economic Review. 104 (4): 1091-119, 2014, http://dx.doi.org/10.1257/aer.104.4.1091

[vi] Page 139: “In Silicon Valley…” Massaro, Rachel. “2016 Silicon Valley Index.” Joint Silicon Valley, Inc., 2016, https://www.jointventure.org/images/stories/pdf/index2016.pdf

[vii] Page 140: “A comprehensive study…” Hill, Catherine, Kevin Miller, Kathleen Benson. “The Simple Truth about the Gender Pay Gap.” American Association of University Women, 2016, http://www.aauw.org/aauw_check/pdf_download/show_pdf.php?file=The-Simple-Truth

[viii] Page 140: “A Catalyst survey…” Carter, Nancy M., Christine Silva. “The Myth of the Ideal Worker: Does Doing All the Right Things Really Get Women Ahead?” Catalyst, 2011, http://www.catalyst.org/knowledge/myth-ideal-worker-does-doing-all-right-things-really-get-women-ahead

[ix] Page 140: “Female MBAs…” Greenhouse, Steven. “M.B.A’s Have Biggest ‘Mommy Penalty,’ Doctors the Smallest.” The New York Times, December 6, 2010, http://economix.blogs.nytimes.com/2010/12/06/m-b-a-s-have-biggest-mommy-penalty-doctors-the-smallest/?_r=0