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Equivalence (for women)

On April 23, 2018, in Dr. Chris Andrews, Editorial Advisory Board, HRExaminer, by Dr. Chris Andrews

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“While looking at the issue of gender pay equity for work purposes I thought it seemed unnecessarily complex. I asked the eldest of my three daughters what she knew, and she answered that she understood women were paid less than men, but that she couldn’t readily explain why.” – Dr. Chris Andrews

While looking at the issue of gender pay equity for work purposes I thought it seemed unnecessarily complex. I asked the eldest of my three daughters what she knew, and she answered that she understood women were paid less than men, but that she couldn’t readily explain why. This is not surprising as the variables making up the difference are yet to be fully explained. I looked at various academic papers but the competing arguments, language, and nuances left me feeling quite confused. The Canadian, Jordan Petersen, makes sense when he says that the causes of pay inequity are multivariate and situational.

In an effort to break down and simplify this topic, here is one father’s words to his daughters:

There are things that you need to understand about the world in which we live. One of those is the disparity between what you might get paid and what another might get paid in circumstances where there is a difference in gender. A topical example is Hollywood; female movie stars often get paid less than men. Trust me, it happens; and not just in show business.

A conventional analysis would look at individual factors, productivity factors, and unexplained differences. The key differences, in my opinion, relate to the amount of non-labor market work that women undertake over a lifetime, career breaks for family reasons and the choice of occupations.

To make sense of pay equity, we need to look at this issue from different angles. There is the career you might pursue, the position you might occupy, the prospects for advancement, alternative careers when you want a change, and finally, lifelong earnings. There is the conscious/unconscious bias issue, as an input to the pay gap, but that really deserves its own explanation piece.

Which industry will you choose to work in?

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Dr. Chris Andrews | Contributor, HRExaminer Editorial Advisory Board

Different industries, occupations, and locations are paid at different rates and have different prospects (labor market segmentation). In one UK study by the Office of National Statistics, occupation was said to explain 23% of the difference between men’s and women’s pay. Your chosen field will significantly determine your lifetime earnings capacity. Choose wisely. It’s not all about money but also work/family/life balance. Becoming a partner in a law firm, an emergency physician, or something similar looks great on television but the expectation of long working hours, high pressure and a stressful environment goes with all that glamour.

Are you paid the same?

The base hourly rate of pay is usually the same for both men and women at lower pay grades, but differences often emerge as the salary rises and become less regulated. Always look around you; are you paid the same rate as your male co-worker? Is the difference based on legitimate and distinguishing factors, such as actual outcomes achieved?

There are also various ways that income disparity might emerge in a position that has the same base salary, such as different access to additional hours paid at the ordinary time, access to overtime, market loadings, incentive schemes and retirement benefits. Even with bonus schemes, you might have the same potential, but is the spread of actual outcomes justifiable between genders? While men will claim it is based on productivity factors, be wary of these assertions.

Work out how positions are classified, what it takes to get to the next level and the weighting of factors that affect the outcome. For example, if you wanted to be a university professor, concentrate on your research and let others do the management tasks – they will distract you and won’t get you promoted.

A questioning mind is helpful – become a workplace remuneration skeptic – constantly seek out evidence to satisfy yourself of equivalence. A women’s network at the workplace is a good place to start. Bond University has had a Women’s Network since 2004. It serves to generate discussion on gender pay equity issues and family friendly policies, amongst other social and networking activities.

Within the Organization – will you advance in the same circumstances?

In planning career moves, work out where you want to go and what it will require to get there. When career opportunities arise, the employee with good experience in the role will usually trump a similar employee offering only good potential. Make sure you take advantage of learning opportunities and work experience opportunities. Learn more about the positions that surround the job you really want. You will continue to learn throughout your life, embrace this and enjoy the rewards.

Family Matters

Having a child is going to bring enormous happiness but will also affect your lifetime earnings. Time off for maternity leave, returning to work part-time, missed career opportunities and missed learning opportunities; these all can affect lifetime earnings. Make sure you find a place to work that supports women in all stages of their careers.

Although not something easily discussed, you should note that when families are confronted by a relationship breakdown, the effect on lifetime earnings will be considerable and can have a greater effect on women with caring responsibilities. Elder-care can also affect the capacity of women to engage in remunerated employment.

Planning for your Retirement

You will likely live a lot longer than any male companion so plan for this early and make sure you are able to live comfortably. In the Australian context, Coates (2018) advises that men’s superannuation account balances at retirement are on average twice as large as women’s. Any income inequality, because of salary disparity or time out of the workforce, during your working life will also be reflected in your retirement balance.

Role models, careers and changing tack

You are all strong, independent, career minded women. Select a role model that suits your purpose and ‘aim to be better.’

For example, your mother is a mechanical engineer, who became an industrial advocate, a successful private business owner and then a federal politician. Your aunt is an agricultural scientist who: undertook post graduate studies, specialized in animal nutrition, managed a 1200 head dairy farm, worked as an international dairy consultant; went back to study psychology at undergraduate and postgraduate levels; and has now made another career change to work in higher education.

Takeout – you can reinvent yourself, so keep an open mind. And while working for yourself may seem unlikely now, after a few years of working for others you might consider the possibility of working in your own business. Be wary of the new models of work, (which can have their own gender pay gap):

“Young women were far more concerned about being replaced by someone prepared to work for a lower wage than being replaced by a machine”. – Matt Wade, Brisbane Times, 10 March 2018

Be bold

Some women moderate their expectations when negotiating for a pay rise, and often negotiate using a less assertive style. In the classic Harvard Business Review article, Nice Girls Don’t Ask (2003) women were advised they must ask for what they want and need. To do this you need to work on your self-confidence and really believe in your own abilities.  This also applies when considering promotional opportunities as a lack of confidence will often hold women back from applying. Unfortunately, this reticence facilitates income disparity and could allow employers to feel comfortable in maintaining disparate pay outcomes within an organization.

Maintaining your Independence/share the load

Managing your own finances is important, as is a basic understanding of wealth creation and balanced financial portfolios. A fun way to do this is to watch Claire Hooper’s series at The Pineapple Project. Choose someone for a companion that does at least 50% of the domestic chores, anything less is just plain unacceptable. Try to spend on things that deliver value-for-money.

Last words

As women you are likely to have lower lifetime earnings than an equivalent male. Career breaks for family can entrench that outcome, as will periods of part-time employment and non-labour market activity. But you are likely to live longer so you will need to keep an eye on funding for the long term. Making sure you get paid the same as your male counterparts will require vigilance.

The rise of artificial intelligence (AI) might also reinforce a gender pay differential as bias can be inbuilt in these systems. Be wary of new ways of work that simply result in another gender pay gap.

In 1971, the Australian Prime Minister Malcolm Fraser famously said, “life wasn’t meant to be easy”. Indeed, it isn’t.

However, I prefer the full quote from George Bernard Shaw (Back to Methuselah)

Life is not meant to be easy, my child but take courage: it can be delightful”.


References:

Understanding the gender pay gap in the UK

Bond University Women’s Network

Nice Girls Don’t Ask

The Pineapple Project
with Claire Hooper

BCEC WGEA Gender Equity Insights 2018 Report

The Uberisation of caring work is diabolical

Men fear robots more than women do

Now Is The Time To Act To End Bias In AI

 

graphic for The 2019 Index of Intelligent Technology in HR


 
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