Originally Posted on Austin Business Journal
A recent study placed Austin 44th among the best U.S. cities for women in tech, with tech women in our city being paid about 80 percent what men are paid. Houston is faring much better: it’s #11 at 94 percent. With Austin being such profound hub for tech jobs and with the city being so progressive, does that news surprise you?
I asked my friend and colleague Laura Stoner that question. Laura is the VP of Sales Operations at FATHOM, a smart grid solution for water utilities. She was surprised, but then she asked some of her female colleagues their thoughts, and a hidden picture emerged.
“One friend revealed that she became aware she was being paid up to 40 percent less than one of her male peers. That was shocking. I think it’s something that’s not discussed openly enough, which is part of the issue,” Laura told me.
The 80-cents-on-the-dollar gap in pay may not seem huge, but it depends on how you look at it. The Washington Post likens it to women working ten weeks out of every year for free. That’s significant. But women are surpassing men in other key STEM jobs. According to 2015 Bloomberg study, female managers in architecture and engineering jobs as well as female chemical engineers out-earn men.
So why is tech lagging? Does it have to do with geography, job level, skill sets, industry, or even a shrewdness more men than women might have to ask for a higher salary? Sure, each of those factors may play a part. But whatever the reason, employers should consider whether they’re a part of the pay-gap problem and, if so, how they could benefit from correcting it.
“My advice is to hire for diversity, whether or not there is a corporate initiative behind it. You’ll have blind spots in your business without a range of perspectives at the table,” Laura said after I asked her what she’d like employers to know. “If you’re concerned at all about attracting and retaining top talent – male or female – consider what the market pays for the roles and strive to keep your team’s pay in as close alignment with the market as possible. The high-tech space is competitive, and I’ve heard leaders make short-sighted comments about ‘getting a great deal’ when they hire a talented person at a lower-than-market salary. I think that’s a big mistake. Those inadequately compensated employees will find out – whether by hearing from other employees or by being educated by recruiters or doing research – and those companies will see their talent walk out the door.”
To help close the gap in your organization:
1. Avoid asking about salary history. It can perpetuate stereotype-based pay gaps and is, in fact, illegal to ask in an increasing number of states and cities. So far Oregon, California, Massachusetts, Delaware, New York City, Pittsburgh, Philadelphia, and New Orleans each have some ban in place when it comes to asking about what a candidate has made in the past, and I assume more will follow. Get in the practice of asking about salary expectations instead.
2. Have a salary range in mind. When, how, and even if you provide candidates a salary range is up to you, but I do recommend standardizing your salary ranges at least for internal use. Doing so will help you avoid determining salary on a case-by-case basis, which leads to highly inconsistent salaries among peers. Instead, have a consistent compensation grade upfront and have real, quantifiable reasons for determining each candidate’s offer within that range.
3.Consider using job assessments to help reduce gender bias. Job interviews are inherently biased; once you meet someone face-to-face, even unconscious preconceptions can invade the process. The more you can eliminate those biases, the fairer your process will be. With job assessments, your salary decisions can be more closely tied to tested skills and culture fit and less on your gut feeling or salary history.
4. Don’t fight change. We’re entering a time of conscious capitalism, where purpose and culture are as important as profit. It just so happens that women often make the best conscious leaders, which helps explain why female CEOs of some of the biggest businesses in the U.S. out-earn their male counterparts by an average of more than $2 million.
Whether hiring in tech or another field, hiring an executive, entry-level or somewhere in between, take a good look at whether you carry biases based on “how it’s always been done.” That right there could cut to the root of any pay gap that could be present in your organization.