Women in Texas have made little progress closing the gap in wages with their male peers. But, Friday’s jobs report from the Bureau of Labor Statistics (BLS) reported the 92nd straight month of U.S. job growth. As employers face the tightest labor market in decades, they are forced to increase compensation for even non-supervisory positions.
Combined with a growing awareness of gender inequality in the workplace, Texas’s labor market is experiencing a “perfect storm” of workforce and cultural transformation, where women have a rare opportunity to negotiate wage adjustments and close the gender wage gap once and for all.
In an economy going gangbusters, employers are under enormous pressure to invest whatever is required to attract the best talent and retain their best employees. Organizations that meet women’s demands for wage parity and actively pursue greater gender diversity within executive leadership could see a remarkable return on the investment.
But change won’t be easy. Women in all industries and at all corporate levels still face a wage gap based on their gender, according to the most recent data. The National Women’s Law Center indicates U.S. women who worked full-time, year-round in 2016 were typically paid 80 cents for every dollar paid to a similarly situated man—an average loss of $10,000 each year.
The gap may even be wider according to new research by the People’s Policy Project. When you include contingent workers—part-time, freelance, and contract employees—the gender wage gap nearly doubles, from 20 cents to 39 cents. It gets worse for women who climb the corporate ladder. By age 50, male executives make 65 percent more annually than similar female executives, according to compensation research firm Payscale, and are 85 percent more likely to have advanced to the C-suite.
Still, if there was ever an opportunity for progress, it is now. With unemployment dropping below 4 percent, and wages ticking up over the past two months, many economists forecast the beginning of a sustained period of wage inflation.
Wage growth is a sign that talent scarcity is a concern for employers. More than half of the 800 C-suite and human capital leaders surveyed for Randstad Sourceright’s 2018 Talent Trends Report said they were concerned enough to plan substantial investments over the next year to improve the workplace experience and attract and retain the best talent.
Recent events have also elevated the issue of wage equality to the point that it is difficult to imagine a female candidate negotiating salary without the issue surfacing, one way or another. The #MeToo movement against workplace harassment precipitated the #TimesUp campaign, which has raised awareness of the gender wage gap across industries. In response, some high-profile companies—like Google, Salesforce and Citigroup—have already announced salary adjustments to eliminate any gap in wages between their male and female employees.
Other employers must follow their lead if they hope to retain the valuable women they currently employ. A full 80 percent of women, in fact, recently told Randstad US that they would leave their employer for one that offered better gender equality.
But is this perfect confluence of events enough to convince employers to make wage adjustments? Ground-breaking evidence suggests that savvy employers would be wise to consider that gender parity is critical for business success. In tight markets, every little advantage counts, and gender diversity is no small advantage. The McKinsey Global Institute has documented that more diverse executive boards can impact a company’s performance and generate 53 percent higher returns on equity than companies without diverse leadership.
When efforts to diversify organizational leadership are paired with a genuine commitment to include women’s disparate perspectives, the result is more effective executive leadership and potential profits that more than compensate for the higher salaries required to close the gender wage gap.
Change occurs not from knowing the right thing to do, but by doing it. Women may have no better opportunity than now to achieve wage parity with men, and they owe it to each other to make the most of this moment.
Dallas resident Rebecca Henderson is CEO of Randstad Sourceright, a global talent solutions leader.