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The Ugly Truth About Equal Pay

Equal Pay

Every year on March 8th, International Women’s Day is celebrated in countries around the world to recognize the accomplishments of women, while also acknowledging the areas in which women still struggle. For all the milestones in gender equality that have occurred in the last century, complete equality is still just within reach. During the month of March, we raise awareness about one specific equality goal: financial equality.

Make no mistake, 21st century or not, women overall are still being shortchanged, often literally. Equal pay has been a concern for decades, with the United States going so far as to pass the Equal Pay Act in 1963, mostly bolstered by the increase in working women since the second world war.

International Women’s Day has its roots in the early 20th century. By 1975, it had been adopted by the United Nations and made its way across the globe. In other parts of the world, International Women’s Day is not a recognized holiday, but is instead as a day of protest and demonstration. Sometimes the protests are traditional, with thousands of women taking to the streets, striking from work both professional and domestic or marching on various capitals. Other times the protests are more subtle.

For International Women’s Day 2018, women across multiple countries organized and “edit-a-thon” and hit the popular information site Wikipedia with a maelstrom of edits and changes to counter some of the gender biases that plague the sites distribution of articles.

Equal Pay Day

Once a year, several countries also observe a symbolic day known as Equal Pay Day. This day is meant to mark the point at which working women will have finally earned the same salary as men from the previous year. This year’s Equal Pay Day in the United States is Tuesday, April 2, symbolizing the 15 months women work to earn the salary men earned in 12 months. Equal Pay Day was first organized by the National Committee on Pay Equity as a way to highlight the gender pay gap and bring awareness to pay inequality in its many forms.

Equal Pay Day is not an official holiday, and is less well-known than International Women’s Day, especially in the United States. However, in the the Czech Republic, Equal Pay Day is a two-day long mega event with educational workshops held for thousands of people.

The Pay Gap

There’s a lot of confusion surrounding the gender pay gap, what it means, and what the percentage actually is. The truth is that there is no one “true” gender pay gap. It is a fluid measurement of the average pay of women versus men. Race, ethnicity, and location can all play a factor in the data and depending on which demographics you focus on, you’ll come away with slightly different numbers.

The average gender pay gap between women and men hovers around 20 percent, meaning women are earning around 80 cents to every man’s dollar. The gender pay gap is sometimes adjusted for various factors like career choice, maternity leave, and hours worked, but that is not usually relevant for the majority of high performers in male-dominated fields.

Equal Pay Day exists to draw attention to more than just these raw numbers. It is an occasion meant to also call into question the social structures that lead women to choose lower paying careers and work fewer hours. For example, take the maternity leave explanation. When a woman takes months off for maternity leave, it results in her working fewer hours than a man in the same job, and thus earning less money. At first glance, this may seem fair: Fewer hours equals fewer dollars. Equal Pay Day exists to examine all the reasons why women might “choose” to make less money than men. It raises the question of whether or not we want to live in a society where women are pressured to take less when we are often just as productive.

The Intersectional Pay Gap

Like all statistics, the pay gap can be as broad or as granular as you make it. When we look at women of color, we see that their salaries average just over 60 percent of that of white men. Hispanic women earn even less, at 53 percent.

The pay gap can also be broken down by profession. However, even in traditionally female-dominated fields like nursing, we still see that women earn less than their male counterparts. We see the largest gap in the financial industry, where female financial consultants and money managers earn about 65 percent of their male counterparts’ salaries.

Location also matters. Even within the United States, the numbers vary wildly depending on what state you look at. Louisiana typically ranks last of all 50 states, with women earning less than 70 percent of what men earn. These state by state variances have several causes, including the following:

  •      The racial makeup of different states.
  •      The relative strength of state-by-state equal pay laws.
  •      Regional differences on the interpretation of gender roles.

What’s important to note here is that women lag behind men by almost every conceivable metric when it comes to income, and non-white women are hit particularly hard by the wage gap. Trans women are another demographic faced with a widened pay gap. Even more so than cis women, trans women struggle to land and keep jobs, even ones they are qualified for. International Women’s Day and Equal Pay Day are about more than just the numbers, they are about the reasoning behind the statistics.

Why are women paid less than men?

The root causes of unequal pay are many, and they overlap each other at every opportunity. On an individual basis, it can be almost impossible to tell which issues are the direct cause of pay or workplace discrimination against women. There are many factors that contribute to the overall gender wage gap, including:

  • Direct pay discrimination

This is when employers deliberately pay female employees less money for the same work that their male counterparts do. Although this type of direct salary discrimination is against most equal pay laws, it still happens, and it can be notoriously difficult to spot and correct.

  • Hiring and salary discrimination against mothers

In 2017, the Atlantic reported on the plight of single mothers in Japan, where women are often openly turned down for jobs because of the possibility that they may prioritize their children over work. This kind of discrimination is not unique to Asian countries; it happens all over the world. The only difference is how honest an employer is about their reasoning. Pregnant women are at an even greater risk of being passed over for jobs because of potential impending maternity leave.

  • Societal expectations

Sometimes the reasons for pay discrimination are subtle. In many countries, women are encouraged to be less aggressive and more soft-spoken than men, leaving many working women unwilling or unable to request pay raises that they may deserve. Attitudes about women where the requests of female employees are seen as nagging or unimportant can also contribute to women getting stuck in the lower rungs of the pay ladder.

  • Salary gag rules

Many companies have strict policies against employees learning each other’s salaries. Being unable to compare their salaries to their male coworkers’, many working women may be unaware that they are receiving less money.

  • Industry salary standards

Different industries have different salary brackets. Male-dominated industries such as technology and the higher levels of business management tend to have much higher salaries than traditionally female-dominated industries.

Fighting the Gender Pay Gap

So what are the next steps? Evidence shows that the pay gap is slowly narrowing, but in a rate that is far too slow for comfort. Raising awareness is important, but what can we do to end the pay gap once and for all?

There is no one solution to the gender pay gap. Solving this international problem requires many small but important measures of effort. Legislation is always on the agenda. Despite the Equal Pay Act of 1963, the pay gap still persists, and while bringing the laws of all countries (or even just all 50 U.S. states) in line with one another will have an impact on the more direct causes of pay inequality, it will do little to stem the social issues that persist.

The attempted normalization of paternal leave is another step towards equal pay. In a society where both men and women are equally likely to take off time to spend with their newborns, the motivation to prefer male employees over women weakens.

The act of “leaning in” has also been promoted heavily in recent years, since the publication of Sheryl Sandberg’s book in 2013. The idea is for women to “lean into” the workplace conversation: offering to lead, straight-up asking for raises that they deserve, and above all else, refusing to fade into the background. Slowly, many women are acknowledging their own imposter syndrome and finding the confidence to start their own companies, climb the workplace ladder and secure better compensation for their expertise.

This single-minded approach is not always successful, though. As we’ve discussed previously, the “lean in” strategy has a problem with encouraging women to spread themselves too thin. Sometimes the lofty goal of a skyrocketing career, the perfect family life, and the perfect marriage is just not ideal. In the modern world, these things often clash. Many women are not afforded the opportunity to apply themselves fully to both their children and their career, with many professions punishing women for familial concessions like maternity leave. (California, New Jersey, and Rhode Island are the only states with required paid family leave.)

The Compounding Economic Effects of Equal Pay

Unequal pay gets exponentially worse for women in lower income brackets. For example, women who cannot afford child care must then take more time off work after the birth or adoption of a child, which in turn contributes to their smaller yearly earnings, thus forming a vicious cycle.

Women collectively lose out on billions of dollars a year due to unequal pay, which then endangers their financial independence. Being able to support oneself is a comfort that a lot of people, many of them women, lack. An absence of financial independence can even lead victims of domestic abuse to stay in dangerous environments. Women’s liberation may have truly kicked off in the mid 20th century, and although decades have passed, the work is far from done.

Finding Personal Fulfillment

Individualized success is an important aspect of self-efficacy. In short, everyone  should be in a position to live their best life. For some women, that may be an exhilarating career, a family, financial success, or any combination thereof. The point is that everyone has an ideal self to strive towards, and that success is measured in one’s own terms.

Burnout, perfectionism, imposter syndrome and all other roadblocks you may experience are real concerns that can keep you from living the fulfilling life imagined when you started your career. With the right mindset and support, you can reach your own personally defined goals.

Financial health and overall wellness are linked. Only when you achieve better work-life integration will you find yourself living well, no matter what they pay. Remember, the goalposts set by others are irrelevant to you. Create your own targets and set yourself up for success.  Schedule a Soar to Excellence TM Assessment with Dr. Toni to get started!

About Dr. Toni A. Haley

Toni A. Haley, MD is a bestselling author, speaker and certified executive coach for high performing women. She is also the founder of Soar to ExcellenceTM Coaching. Dr. Toni is sought after by clients for her 25 years of experience in healthcare, wellness and finance. Her proven strategies have helped hundreds of women break through personal and professional barriers, such as Martyr MindsetTM, Perfectionism, and Imposter Syndrome. Dr. Toni has committed her career to empowering others to achieve greater prosperity and fulfillment beyond success.

Dr. Toni MD

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