Having more women in management may not shrink the wage gap
As more women move into management roles, the stubborn gap between men and women’s pay will automatically narrow and, eventually, disappear — right?
It’s a popular assumption, but there’s just one problem: It may not be true.
“Having more women in management is crucial to getting rid of the wage gap,” says Sameer Srivastava, who teaches management at Berkeley’s Haas School of Business. “But, all by itself, it isn’t enough.”
To test the assumption that women who work for other women earn salaries closer to their male peers’ than women with male bosses, Srivastava led a study that looked closely at 1,701 employees who worked at a leading U.S. financial-services firm from 2005 to 2009. After taking into account seniority, skill levels, and other factors that might influence pay, the researchers found that female employees earned, on average, 17% less than their male counterparts.
Here’s where it gets interesting. Over the four years the study examined, a significant number of employees changed bosses, but the wage gap persisted. “When women switched to a female boss, the gap did not shrink,” Srivastava says.
In some cases, it got bigger, particularly for women identified by the company’s performance rating system as “low-performing” who switched to working for a “high-performing” female boss. Men whose job performance was also rated below average, and who also went to work for high-performing female bosses, were paid 30% more than their female counterparts over the following year.
Granted, the study focused on one company, but “it’s quite typical in its performance-management, compensation, and other practices,” says Srivastava, adding that the firm’s managers have the same amount of discretion over pay and promotions as they would have at any other non-unionized company.
Expecting the gender wage gap to vanish just because there are more women in management is probably “wishful thinking,” the study concludes. Instead, more deeply rooted changes will have to happen, including the development of “an organizational culture that is keen on gender equality” at every level — and a genuine acceptance of women in high places.
The study will be published in a forthcoming issue of the American Journal of Sociology.