Carl Richards on Fighting the Gender Pay Gap

My daughter started her senior year of high school this fall. With college fast approaching, I’ve had some fun discussions with her and family friends about future professions. One thing keeps coming up: It’s the 21st century, and our daughters may still earn less than men for doing the same work.

When my daughter graduates from college, the odds are high that the situation will not have changed much. But while there are many things we can’t fix in this world, but pay inequality ought not to be one of them. And we can start by learning to talk about it in an open and honest way.

One recent development in this issue came from the Gap, which shared their internal pay breakdown. It’s a surprise move for a Fortune 500 company, but the numbers show Gap pays men and women in the same jobs equally. In a company where almost half the executives are women, it’s a big deal. It raises an interesting question. Why don’t more companies make the same disclosures?

I suspect it comes down to something simple: There’s no real consequence if they don’t.

We’ve all been taught it’s not polite to talk about what we earn, so the word doesn’t spread. Also, employees are strongly discouraged from talking with each other about what they earn. Some companies will even threaten termination if employees reveal salary, even though they can’t legally bar you from doing so. If people can’t talk about what they make without fear of retaliation, it’s very difficult to learn about company pay policies.

The other fig leaf companies try to hide behind is job type. Women aren’t really paid less, the argument goes. They’re just in lower-paying jobs over all. But there’s a small problem with that line of thinking. It’s not true.

Earlier this year, Claire Cain Miller wrote an article focusing on the work of Claudia Goldin, a Harvard University labor economist. According to Dr. Goldin, rearranging women into higher-paying occupations would erase just 15 percent of the pay gap for all workers and from 30 to 35 percent for college graduates. The rest has to do with something happening inside the workplace.

Dr. Goldin’s data shows that some professions have done a better job of closing the pay gap than others. She says she believes “the gender gap in pay would be considerably reduced and might vanish altogether if firms did not have an incentive to disproportionately reward individuals who labored long hours and worked particular hours.”

I don’t blame people for being uncomfortable with this issue. It means admitting we might be biased or part of a cultural tradition that is biased. I admit to being guilty of passing the issue off as someone else’s problem, at least until my daughter reached an age where it forced me to think and talk about it.

But it’s not just about my daughter or your daughter. It’s about all the amazing women we know who do incredible work and make less money simply because they’re women. One female friend learned after getting hired that married men made more at her company for doing her same job. The logic? They had a family to support, and she was single with no children. Of course, it wasn’t official policy, so talking about it during annual salary negotiations was a challenge.

It’s stories like this one — and the ones my friend Tess Vigeland shared at The Guardian — that make me want something better for all the women I know. I asked Tess what advice she would have for my daughter when she entered the work force.

“Be confident in your abilities, your value, and yourself, and do not back down,” she said. “Fight. Fight fair, fight with integrity and professionalism, but fight hard. If you don’t get answers, take it up the ladder. Asking questions about gender equity is not a firing offense. And if nothing changes, leave. Take your talents, your energy, your skills, elsewhere. You deserve no less than your male colleagues. Do not EVER believe otherwise. Full stop.”

Seems like excellent advice for all of us to remember.

This commentary originally appeared September 8 on NYTimes.com

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© 2014, The BAM ALLIANCE

Carl Richards, CFP®

Carl Richards is the creator of the weekly Sketch Guy column in The New York Times and is a columnist for Morningstar Advisor. Carl has also been featured in The Wall Street Journal, Financial Planning, Marketplace Money, The Leonard Lopate Show, Oprah.com and Forbes.com. His simple but meaningful sketches served as the foundation for his first book, "The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money."

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