Gen Z women entering the workforce with low salary expectations
Gen Z are not dodging the pitfalls of equal pay issues as they enter the workforce.
According to a new report from Handshake, a career app aimed at Gen Z, women appear to be falling behind on pay even before their first professional job.
But Gen Z women expect to earn $6,000 less on average compared to men, according to Handshake’s analysis. It shows that a clear ‘expectation gap’ has formed for women even before they enter the workplace. The gap was the same for women of all races and ethnic groups.
“It’s a societal issue, and I think it goes back to K-12 education,” said Christine Cruzvergara, Handshake’s chief education strategy officer wealth.
It also harks back to the days of the boomer gender pay gap; In 1980, women’s wages accounted for 64% of men’s wages, according to data from the Bureau of Labor Statistics. While that gap has narrowed somewhat since then, it stalled by about 80% in the 2000s.
The current gender pay gap — women earned $0.82 for every dollar men earned in 2022 — stems from a variety of issues. Women, on average, still face a “maternity penalty” when they have children and lose time in being unemployed and career opportunities. Additionally, women still face perceptual barriers around the work they are suited for. For example, women make up just 27% of the workforce in the typically higher-paying science, technology, engineering, and math (STEM) industries.
Previous research also shows that when women apply for jobs, they are often not as good at negotiating their salary as men, or do not apply at all if they feel unqualified.
Both conscious and unconscious biases and perceptions about the value of women’s work continue to drive the pay gap, which has been constant for more than 15 years. Women, compared to their male counterparts, have slightly lower expectations of what they might be worth and what they would expect if they went into certain areas – and that apparently starts early.
“As a society we still have to think about how we nurture our students and how we instill in them confidence in their own worth, their confidence in what they bring to the table – whether that’s professional or academic or frankly in every other field,” says Cruzvergara, who has helped direct careers services at Wellesley and George Mason Universities.
pay for transparency can help close the gender pay gap
To change this troubling trend, according to Cruzvergara, current college students must not only understand the differences that exist, but also look for information about normal salary ranges for specific jobs and industries. Pay transparency rules, she adds, could actually help. Currently, Colorado, California, Rhode Island and Washington, and New York City all have some sort of pay transparency mandate on the books. New York is expected to implement statewide requirements in September, while legislation is pending in Massachusetts and South Carolina.
In fact, the changes around wage transparency may be one of the first very tangible concrete steps to reduce this expectation gap, says Cruzvergara. “As pay transparency becomes a bigger thing for more and more classes going forward, hopefully that gap will really narrow as people now have the data and information in front of them to adjust their expectations,” she says.
Employers are already responding. According to Payscale’s 2023 Compensation Best Practices Report, about 27% of companies include salary ranges in job postings, regardless of legal requirements. Overall, about 45% of employers include salary ranges in job postings. There are 1.3x as many full-time jobs with salary data on Handshake as of 2020.
“This class is honestly one of the first to graduate with more pay transparency than we’ve ever experienced or seen,” adds Cruzvergara, saying they are the guinea pigs to see how these new regulations change perceptions.
Learn how to navigate and build trust in your organization with The Trust Factor, a weekly newsletter exploring what leaders need to succeed. Login here.
