Last month the US marked Equal Pay Day to raise awareness around the significant wage gap that persists between women and men across the country. This gap is beginning to shrink, but recent data from the US Labor Department prove that this problem is far from being solved.
On average, American women that worked full-time last year earned a median weekly paycheck that was 82 per cent of their male counterparts. This discrepancy can be even more acute depending on the industry. For those who work as physicians and surgeons, women make just 66 cents for every dollar paid to the men in the same role. Among the ten most common occupations for women, the inequality is large enough to qualify women’s earning as ‘low-wage’, while men’s earnings in the same professions are not qualified as such.
Unfortunately, the wage gap has barely moved in the past decade, despite the fact that more women are obtaining higher education than men, and can present a challenge for women who are aiming for the top jobs as corporate leaders.
The higher level
According to a 2017 study by McKinsey & Company, women fill little more than 20 per cent of C-suite positions nationally, despite making up about 47 per cent of the overall workforce. Women of colour are represented in just three per cent of C-suite positions, despite comprising about 17 per cent of the entry-level workforce. These numbers demonstrate the immense obstacles women face in achieving equal pay for equal work.
Fortunately, smart employers are beginning to address these issues by reevaluating their overall hiring processes, and are starting by using innovative HR technologies. More than 75 per cent of businesses recently surveyed by Randstad Sourceright plan to invest in new HR technologies in 2018. These include artificial intelligence applications that help employers avoid unconscious bias in their hiring and promotion decisions, and cloud-based platforms that expand the candidate pools and help companies find more diverse candidates for their roles. These platforms have the added benefit of providing women more flexibility in the interview process.
But companies cannot rely on HR technology to solve the problem alone. Employers need to actively demonstrate a commitment to inclusion and equality, starting from the highest levels of the company.
Tactics for achieving this goal begin with a comprehensive audit of the barriers women face – from intern to CEO. Identifying where women are impeded and creating a diversity pipeline can help overcome the barriers to equality.
Employers who are transparent about salary and provide equal pay will also attract top female executives. According to a recent survey, a vast majority of women agree they would switch employers if another company had greater gender equality, and more than half of global talent leaders and C-suite executives believe having more women in leadership roles is critical to organisational success.
New research indicates that having women in corporate leadership positions improve a company’s overall performance and can increase annual gross earnings. On average, companies with the most diverse executive boards make 53 per cent higher returns on equity. When top companies have women at the helm, they are found to generate up to three times the returns.
On the heels of Equal Pay Day, US employers should boost their efforts to implement vital diversity initiatives. This will not only help close the gender pay gap, but will foster an inclusive environment that enhances the company’s business strategy for the future.
"When top companies have women at the helm, they are found to generate up to three times the returns."