Why the pay gap between men and women in management persists

Wednesday, September 29, 2010

A new Government Accountability Office report released Tuesday finds that female managers earned just 81 cents for every dollar earned by their male counterparts in 2007, compared with 79 cents in 2000. Women make up 40 percent of U.S. managerial ranks, little changed from the 39 percent ratio in 2000. And working mothers with children under age 18 account for an astonishingly low 14 percent of all managers, a number that hasn't changed since 2000.

Countless attempts have been made to explain the persistence of the wage gap in management, which has hovered around 80 cents on the dollar for so long that the number has become conventional wisdom. It's discrimination, women's groups say. It's education, others argue. Women don't negotiate well for raises, some say. Or, my personal favorite, they simply aren't tough enough to reach the highest levels of corporate power.

The GAO report does not make an effort to explain or analyze its findings, which largely reveal that despite relative economic health (the new numbers are for 2007, remember), little has changed. But it does, for the first time, take an in-depth look at the impact of motherhood on the pay discrepancy between male and female managers, offering revealing clues about the primary reason this issue remains perennial.

Let's take a look at the common explanations one by one. Discrimination surely plays a role, and it's one that shouldn't be discounted. But years of diversity training and equal-opportunity policies have barely moved the needle on the pay-gap issue. So while discrimination is alive and well in many offices, it's only one reason, and probably a small one at this point, for why the gap persists.

Education is finally out as a rationale. Last year, women earned more PhDs than men for the first time. For every two men who graduate from college or receive a graduate degree, three women do, the inverse of the ratio in place when baby boomers headed to college, a story in Time reports. The GAO found similar improvements: Among women ages 25 to 64 in the labor force, the proportion with a college degree roughly tripled from 1970 to 2008.

And yes, it's true that few women have reached the highest levels of corporate power; the numbers become far grimmer when you examine just the executive ranks of managers. In 2009, just 13.5 percent of executive officers in corporations were women, according to the nonprofit Catalyst. That same year, only 6.3 percent of the top earners in business were women. And an amazingly low 2.6 percent of chief executives among the country's 500 largest corporations are women.

Although some women might not negotiate well, and others might shun the hot seat, I'd argue that the main reason few reach the top rung of the corporate ladder is that the extraordinary demands on executives' time, or even on senior managers' time, are not compatible with raising a family. In a corporate world that demands a 24-7 schedule and far-flung globetrotting, many women - and increasingly, men - decide the sacrifice is not worth it.

The incredible persistence of the wage gap is a complex issue, involving all of the above issues in some way. But until leaders adopt family-friendly policies and workplaces, and until more is done to support working mothers with greater child-care resources, the wage gap isn't likely to budge much more.

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