Today, planners and pros, we’re tackling a big one: the gender pay gap. Working women are instrumental in contributing to thriving, healthy economies—yet the checks they cash don’t often reflect their value, worth, or contributions in the workplace. Today, then, we’ve teamed up with our friends at Ellevest to talk closing the gender pay gap once and for all. Read on for some serious insight on income equality...because a dollar, we all know, doesn’t really care who spends it.
Let’s Start With the Facts...
Research shows that women, on average, make $0.78 on the dollar in comparison to their male counterparts, and women of color make far less than that (anywhere from $0.54 to $0.63, depending on ethnicity). In addition, women with disabilities make $0.72 on the dollar compared to men with disabilities. And—as if that weren’t enough—we also know that female freelancers (think: writers, editors, graphic designers, artists, etc.) make 32% less than male freelancers.
We also know there’s a major disconnect between what women are paid and their role in contributing to healthier economies. Working women are absolutely instrumental in driving economic growth and GDP. According to this McKinsey study, for example, 25% of the U.S.’ current GDP since 1970 can be attributed to having more women in the workforce. It also estimates that full gender equality (i.e. closing that pay gap) could add up to $4.3 trillion to the U.S. annual GDP by 2025. In short, women play a huge role in contributing to our economy, and closing the gender pay gap has serious benefits for our economic health across the board.
So how, exactly, do we get to a world where we’re paid based on our efforts and contributions, rather than our gender? Well, unfortunately there’s no formula or fast-track to equality—but having the confidence and tools to advocate for ourselves is the number-one place to start. As an employee, it starts with asking for that raise. As a business owner, on the other hand, it starts with analyzing your payroll, looking for areas that call for improvement, and ultimately addressing those.
When You’re Advocating For Yourself…
We are so often fearful of asking for a raise because it feels emotional, entitled or downright uncomfortable. But, to help ease those nerves, we encourage you to look at asking for a raise like you would any other work project—preparation is key. Do your research ahead of time so that your ask is backed by facts, rather than emotions. Here’s what we recommend:
- Start by figuring out what your role is worth using an online salary-comparison tool like com, hired.com, or getraised.com.
- Schedule a meeting with your boss with the goal of learning what success looks like—both for yourself and for the business as a whole.
- Define clear, measurable goals based on that meeting.
- Once you hit those goals, you’re now backed by clear, data-based examples of how you’ve contributed to the business’ success as a whole...and you’re ready for another meeting!
- Show up with examples of both the goals you’ve hit, as well as any salary-comparison data you’ve gathered. Work out some talking points ahead of time, and stick to those as best you can.
- If you’re told no, that doesn’t mean the conversation has to end. You can ask for other forms of compensation as well—think: a new title, more responsibility, a high-profile project, a more flexible work arrangement, etc.
- And, no matter what answer you get, saving and investing is always a great idea. It never hurts to have a “I can’t wait to quit!” fund, after all.
The most important thing to remember when you’re advocating for yourself in the workplace, though, is that you should never stop at asking for a raise. You want career-advancement opportunities and more responsibilities in the areas you in which you thrive. As Ellevest Co-Founder and CEO Sallie Krawcheck says, “Money is great; believe me, we understand that. There are also other things that are worth a lot—and can lead to maybe even more money later. So don’t just stop at asking for the raise.”
When You’re Striving for Equality as a Business Owner...
Even the most open-minded, forward-thinking business owners can end up underpaying their female employees—whether that’s a result of ageism or subconscious social beliefs, or a little bit of both. It’s vital as a business owner, then, that you regularly assess your payroll and the people on it, and address any areas of concern. Some pointers:
- Compensate people for the work they actually do, rather than their experience. So often, younger females are paid far less than their older, male counterparts even though they’re contributing just as much. Stop focusing so much on that “years of experience” number you saw on someone’s resume when you first hired them and shift your focus, instead, to how they show up on a day-to-day basis. Are they champions of your brand? Do they stay late when needed without complaint? Do they produce great work? Are they a team player?
- Know how to set your hourly rates for contract employees in a way that fairly compensates them. Contractors (freelance writers, graphic designers, photographers, etc.) are responsible for paying their own taxes and benefits, and they also pick up the tab for their own equipment, workspace, office supplies, tools, etc. As such, contract employees tend to deserve much higher hourly rates than a typical employee.
- Make sure you’re performing annual performance reviews for every single employee. As part of these reviews, you should always set measurable goals and plan pay increases for when an employee meets or exceeds these goals. Don’t just treat these meetings as something to check off your HR list—block out enough time to allow for constructive conversation and employee feedback.
- Look for ways outside of pay to compensate employees as well. Things like flexible work arrangements, more paid vacation time, greater responsibilities, and better titles are all things to consider when you’re analyzing employee compensation.
Overall, closing the gender pay gap starts with being our own—or our employees’—advocates. Arm yourself with research and fact-based analyses. Above all, always look for opportunities where you can set measurable goals...and then exceed them like the unstoppable, unflappable wonder woman you are.
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