Today is Equal Pay Day, denoting how far into 2024 women must work to earn what men earned in 2023. This gap is driven by the fact that women only earn 84 cents on the dollar for what men are paid.
We clearly still have more work to do when it comes to pay equality. And no one knows this subject better than Dr. Paula England, one of the nation’s leading experts in sociology and a Professor of Sociology and Dean at New York University Abu Dhabi. Last summer, Pave’s Head of Data Science, Dr. Stefanie Tignor, hosted a fireside chat with Dr. England to learn more about the pay gap, what is driving it, and the levers to narrow it.
In honor of Equal Pay Day, we’re publishing a few key takeaways from that conversation.
Please note: This is an excerpt of the conversation, edited for brevity and clarity.
Dr. Stefanie Tignor (ST): What are some of the causes that we’re seeing for the wage gap between men and women?
Dr. Paula England (PE): There are a couple of forces driving this. One driver is that women tend to be in lower-paying occupations than men. Another driver is that women can be paid less than men, even within the same job. The former contributes to a bigger part of the gap.
There are a lot of different things that create this tendency for women to be in lower paying fields. One mechanism is bias or discrimination in hiring, in which employers won't hire as many women into high-paying jobs.
Another kind of bias, which I focused on in my research, is how men and women end up distributed differently among fields. Some jobs are more prevalent with women, and others are more prevalent with men. The jobs that are associated more closely with women pay less than you would expect them to, even when taking into account the kinds of skills and education they require. What this means is that the whole job gets devalued if it’s associated with women.
ST: Women make about 84% or 84 cents on the dollar of what men are paid, and of course, this differs based on race. But it feels like I’ve been hearing the same number cited for a long time. Is this number moving?
PE: The number has moved, but it’s been moving very slowly in recent times. The gap used to be about 60 cents. When I was a young woman, there was a button that said “59 cents” and everyone sort of knew that it was in reference to the pay gap. It stayed pretty much the same for decades, throughout the 1960s and 1970s. But it started moving more around 1980.
This was the time when more women were coming into the workforce, staying continuously in the workforce, and getting more education. At the same time, marriage was getting pushed to later. People were having their first child later. There was more advocacy for womens’ careers. The 80s was the decade where the gender gap was closing the fastest.
The gap is still going down, but more slowly than what we saw in the 1980s.
ST: What is causing the narrowing of the pay gap to slow down?
PE: You know, I don’t think it’s really well understood. It might be the case that we picked the low-hanging fruit when it comes to pay equity. One explanation is that the legislation we passed in the 1960s took a while to be taken seriously and have an effect. But, there is only so much that laws can do. They’re hard to enforce and there is still bias when it comes to women-dominated jobs having lower pay.
In the US, it’s illegal to pay women and men differently in the same job. But for the issue of which jobs pay more than other jobs, and what criteria you use—there really aren’t laws about that.
ST: Let’s shift gears a little bit and talk more about how to drive change, and things that we can do to close the gender gap. I think there are a lot of different ways in which we could take action. For instance, we could focus on education, offer negotiation, holding organizations more accountable, or enacting policy. Could you walk us through what you think are the most effective levers?
PE: I sort of feel like all of the above could be good levers. Women not getting enough education is not the problem. But I do think that the segregation of occupations—the tendency for some fields to be more closely associated with men and others with women—is an important place to focus. Anything that would diminish this segregation would be helpful, like getting women into STEM (science, technology, engineering, math) fields. And of course, it’s a two-way street. Having more men in traditionally female fields would help, too. Minimizing hiring discrimination, providing state-subsidized child care, and changing norms about who is responsible for childcare would all help.
ST: At Pave, we have a number of really interesting use cases where we can help organizations understand gender pay gaps and potentially address them. If an organization wants to make progress on equal pay, how could we help them?
PE: I know a lot of your customers want to know how they are paying vis a vis the market, which is a very reasonable question because they need to compete with the market. But it's also true that if there's a systematic tendency for predominantly women jobs to be underpaid, market data still reflects that bias.
Making sure that you're paying exactly some percentile at the market for all jobs isn't necessarily a fix to the pay gap, but companies can look at the gender composition and pay for certain jobs. If it doesn’t look good, they can focus on questions like “Should we be getting more women into jobs that are dominated by men?”, or, “What criteria do we want to be using for our comp and is there bias in that?”
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At Pave, we know that having accurate market data is only one part of making progress towards pay equality. Today, we’re releasing a set of data cuts that you can explore to see how you are compensating employees relative to the market.
But the data is only one aspect of it; understanding how compensation differs by gender across job family, seniority, location, and department is crucial, too. Pave can help; contact us to learn more.
Learn more about Pave’s end-to-end compensation platform
