The gender pay gap is an OPPORTUNITY gap

The higher up you look in an organization, the more you’ll find an ever-widening pay gap between genders.  This data suggests that there’s a clear gap in women’s ability to attain higher-paying positions of power vs. men at work.

There are two different numbers to consider when discussing pay gaps, and I’ll briefly define them here before sharing more about this conclusion:

  • Controlled gender pay gap — the pay difference between genders when considering equivalent job titles, education, years of experience, etc.  This is the data being referred to when you hear “equal pay for equal work.”  

  •  Uncontrolled gender pay gap (or “opportunity pay gap”) — this data looks at the pay difference between genders by taking “the ratio of the median earnings of women to men without controlling for various compensable factors.”  According to PayScale, “the opportunity pay gap measures the barriers women face in attaining the higher paying positions of power that men often hold in society.”

While the controlled gender pay gap has been closing over time, it’s still not “equal pay for equal work.”  Currently, women earn $0.98 for every $1.00 a man earns for equivalent job titles, education, years of experience, etc. 

This gap widens as you break the data down by race:

​The uncontrolled gender pay gap is even more pronounced.  In total, women earn only $0.82 to every $1.00 earned by a man (when looking at median salaries for all men and women). 

Similar to the controlled gap, the uncontrolled gender pay gap widens as you break the data down by race: 

Another disturbing trend, the one which drew the conclusion in the opening paragraph of this post, is how both data break down when you look at job leveling.

The hard truth is that, the higher you go in an organization, the wider the gender pay gap becomes — both controlled AND uncontrolled.

Not only are women executives paid less for the same exact work as their male counterparts ($0.94 on the dollar), but they also have fewer opportunities to take higher-paid jobs (women executives’ median salary is $0.70 when relationally compared to male executives’ median of a dollar).

The hard question that we must ask is WHY.

From PayScale:

Pay gaps often widen by age and job level, a sign of white men’s salaries increasing at a faster rate than other groups as they progress in their career. In looking at the career progression for women holistically, it’s clear that the gender pay gap widens as women ratchet up the corporate ladder, creating an even greater deficit in possible lifetime earnings at higher salaries than the median.

Women also tend to move up the career ladder at a slower pace than men. We call this phenomenon the opportunity gap. For example, a roughly equal percentage of men and women begin their careers as individual contributors, i.e. they do not manage people. In 2021, 75 percent of men and 76 percent of women ages 20 to 29 are in individual contributor roles. However, by age 30 to 44, 36 percent of men became supervisors or managers while only 30 percent of women did. Finally, men are much more likely to be directors or executives than women by age 45 or older. A total of 7 percent of women make it into an executive level role at any time of their lives while 12 percent of men do.

This phenomenon is even more pronounced, as before, when we break the data down by race.  See below.

Awareness is often the first seed of change.  Were you aware of this data?  Have any thoughts on this?  Share with us in comments below!
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