More companies must take it upon themselves to close the gender wage gap — especially in the absence of political will to do so.
Bringing gender wage inequities into the national conversation will be one of the Obama administration’s legacies. The Lily Ledbetter Fair Pay Act was the first bill he signed in office, back in 2009. Before leaving office, Obama launched the White House Equal Pay Pledge, urging businesses to take responsibility for closing the gender wage gap — which stood at about 79 percent between men and women in the U.S. in 2014.
More than 100 companies signed the pledge by the end of 2016, including local tech companies like Microsoft, Amazon, Avanade and Zillow.
The pledge had some actionable goals for companies to reduce the pay gap, including conducting annual company-wide pay analysis and reducing unconscious bias in hiring and promotion. While commendable, my criticism of it was that it wasn’t enforceable. It’s easy to take a pledge and just as easy to let it fall by the wayside. Just think of those New Year’s resolutions you’ve already forgotten.
But getting businesses to commit to — and hold up their ends of the bargain — reducing the gender wage gap will become even more crucial when the Trump administration takes over this month.
It’s not too much of a stretch to imagine that achieving pay equity will not be a priority in the incoming administration’s agenda. Donald Trump paid female campaign staff less than male staff. And according to local company Textio’s analysis, Trump’s companies put out job listings that favor male applicants for leadership roles, and favor women for lower-paid jobs.
It’s unclear what becomes of the White House Equal Pay Pledge during Trump’s presidency.
So I’d like to propose that in 2017, more companies take it upon themselves to close the gender wage gap, especially in the absence of political will to do so. There are good business reasons to commit to pay equity — well beyond the moral case for it.
Firstly, companies that don’t prioritize pay equity risk losing highly-talented female employees. This turnover, particularly among women in leadership ranks, can have major consequences on an organization’s ability to solve large, global problems. Mercer research finds women outperform men on managing teams inclusively, being flexible and adaptable and having emotional intelligence.
Plus, in our digitally connected world, it behooves employers to be more transparent, particularly with how employees are compensated. One-quarter of Americans don’t trust their employers. The consequences of this include less engagement, more turnover and less desire to deliver on company-wide goals. Companies publishing their pay equity analyses could go a long way in reducing this.
Lastly, more millennials, regardless of gender, value diversity. This is the generation that will comprise 75 percent of our workforce in the next 10 years. A larger share of Generation Y employees report being more actively engaged when they believe their organization fosters inclusion. According to the study from Deloitte, “millennials value inclusion as a critical tool that enables business competitiveness and growth, and as millennials flood leadership ranks, their perspectives will demand a shift in traditional diversity and inclusion models.”
The fact that it’s 2017 and there isn’t even one nation where men and women get paid equally for equal work is just the tip of the iceberg. I’ve listed just three reasons that would benefit companies to commit to pay equity. As far as resolutions go, this one’s worth keeping.