Women and men charge the same amount. Men get them more often.
Asking for a raise can be nerve-wracking: the stakes are high and you have to be prepared for disappointment if things don’t work out.
But if you’re a man, you might have a better chance of getting a “yes” to your request.
According to a recent CNBC survey, while men and women (11%) asked for a raise this year in response to the rising cost of living, men were more likely to get a raise. Fifty-nine percent of men received a raise, compared to just 52 percent of women.
Given the persistent gender pay gap, that’s not a good sight for employers — according to the Census Bureau, women earn an estimated 82 cents on the man’s dollar. And for women of color it’s even worse. Not to mention that the number of women working full-time has plummeted during the pandemic. Today women are more likely than men to work part-time or not at all.
For both men and women, the reasons they were denied a raise were fairly consistent: 35% told CNBC their bosses didn’t give a reason, 22% said their company didn’t have a budget for a raise, 15% said they had none ineligible, and 8% blamed poor timing.
No one is happy about being denied a raise, and only a third of US workers feel they are paid fairly to begin with. That might not come as a surprise, given that CEO salaries have skyrocketed 1,322% since 1978, while average employee wages have risen just 18%, according to the Economic Policy Institute. In 2020, CEOs were paid 351 times more than a typical employee.
Failing to get a raise at a critical juncture can impact every area of a person’s life, from their career to their savings. 44 percent of women surveyed told CNBC they are not currently prepared for retirement; only 33% of men said the same. More immediately, being denied a raise can also lead to employees going job hunting. A recent Great Place to Work survey found that 54% of women plan to look for new jobs this year, in part because they feel they are not being paid fairly.
Because of the gender pay gap, a woman starting a full-time career today will lose $417,400 over a 40-year career, according to an analysis by the National Women’s Law Center.
Transparency might fix the problem
Experts have long argued that more pay transparency at all levels is one of the best solutions to closing pay gaps between workers.
Increasingly, cities and states are enacting pay transparency laws: they have already gone into effect in New York City, California and Colorado and will go into effect in Washington State on January 1, 2023.
A study by the University of Utah’s Eccles School of Business tracked the wages and productivity of nearly 100,000 US college graduates over two decades. They found that pay transparency “significantly reduces the gender pay gap and other forms of pay inequality [by up to 50%].”
In response to “transparency shocks,” as the researchers call them, companies “significantly change” their wage adjustment policies, specifically by granting larger wage increases to those in historically underpaid groups, especially women of color.
Our new weekly Impact Report newsletter explores how ESG news and trends are shaping the roles and responsibilities of today’s leaders. Subscribe here.
