Half Your Talent Pool Is At Risk: Close The Gender Pay Gap
The gender pay gap is going to start disappearing because younger women aren’t going to put up with it anymore—and they’re not going to bother explaining it to you. They’re just going to quit and go work for your competitors who pay fairly.
Are you losing top talent because you pay women less to do the same work as men?
Maybe you’re paying women on your team fairly; maybe you’re not. Either way, I want to point out a trend that’s going to change your organization by making it stronger or because it favors your more forthright competitors. It’s got to do with why women quit their jobs.
As a headhunter, I’ve always been astonished that money is not the leading reason most people change jobs. At the same time, I know that my best chance of recruiting someone to join one of my clients is to focus on the larger opportunity—career growth, the learning opportunity, and the quality of people at the new workplace.
While money is always a factor, surveys over the years have pretty consistently shown that the top reasons for changing jobs have to do with career advancement and a person’s relationship with a boss. This has been true for men and women. (See Inc. magazine’s “Five Reasons Employees Leave Their Jobs.”)
But something interesting has changed: According to a new report from the International Consortium for Executive Development Research (ICEDR), Millennial women (those who have been working for five to 10 years out of college), say that the number one reason they quit a job is, “I have found a job that pays more elsewhere.”
Every C-level executive should take notice because according to the U.S. Census Bureau, women make up more than half of the professional and technical workforce in the United States. This gender trend will probably continue because young women are now earning college degrees at a faster rate then men. They’re your job candidate pool.
Surveys are also telling us that, too much of the time, women are being paid less for doing the same work as men. A recent Time magazine analysis summarizes the data from the U.S. Census and other sources: “Women earn less than men at every age range: 15% less at ages 22 to 25 and a staggering 38% less at ages 51 to 64.
Here’s the bottom line, I think: The gender pay gap is going to start disappearing because younger women aren’t going to put up with it anymore—and they’re not going to bother explaining it to you. They’re just going to quit and go to work for your competitors who pay fairly.
According to the ICEDR report, your HR department is probably telling execs like you that when your best female team members quit, it’s for “family reasons.” But that’s bunk. Lauren Noel, co-author of the ICEDR report, says, “Our research shows that the top reasons why [Millennial] women leave are not due to family issues. The top reasons are due to pay and career advancement.” That tells me that when you lose good female workers, you need to face a new reality: Is it because you’re not paying them fairly? (See “It’s Time To Paaayy!!!”) Is it because you’re being cheap? (See “Stop Being Cheap: Why Saving Money On Salary Is Costing You Big Time” by my favorite HR pundit, Suzanne Lucas.)
I’ve got a theory, and forgive me if it doesn’t apply to you: Employers pay women less for doing the same work as men simply because they can get away with it. Ask accountants, and they’ll explain it more clearly: This saves money, so the motivation to keep paying less pays off—and thus the habit of paying women less than men is hard to break and easy for your HR department to rationalize.
For generations, women have been putting up with a gender pay gap because “experts” and the media told them it was their problem. Your HR folks probably tell you that gender pay disparity occurs because women:
- Don’t negotiate as hard as men
- Don’t have as good an education (e.g., less math and science because they don’t like those subjects)
- Are more nurturing than competitive
- Don’t like to argue
- Lack confidence
The experts and the media are prescribing “solutions” for women who are underpaid—and the solutions have to do with fixing the “inadequacies” I listed above. It find it interesting that, while it’s employers who decide whom to hire and how much to pay, it’s women’s behavior that needs fixing.
I think that’s bunk. It’s employers’ behavior that needs fixing. If you’re paying women less than you pay men for doing the same kind of work, it’s on you because there is only one thing a woman should have to do to get paid as much as a man: her job. If you don’t get that, a new generation of women has no problem telling you goodbye—and saying hello to your more forthright competitors.
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