Hiring Practices that Help Organizations Bridge the Gender Pay Gap
The average woman in the U.S. is being shortchanged over $400,000 in career earnings. On average, women earn 20% less than men and gender pay disparity is a wide-spread global problem.
Pay Gap Impact on Business
Resolving the gender pay gap is critical to ensure that all employees are fairly compensated. Equal pay for equal work is not just the right thing to do from an ethical standpoint. It’s important for companies to understand that their gender pay gap is negatively affecting their bottom line.
The perception that they are being treated fairly and equitably has an impact on employee performance and engagement. Engaged employees will provide better service and be more productive. Employees who feel they are underpaid are very costly to employers through presenteeism, absenteeism, theft, and lost productivity.
Gender pay gap studies and surveys are becoming more commonplace and very public. Companies with a pay discrepancy are going to lose out on talent and customers. Employees who think they are underpaid are likely to leave. Further, it is difficult to attract new talent when candidates know an employer has a gender pay gap. Also, organizations suffer from the lost customers who are choose to spend their money at businesses with equitable pay practices.
Pay Gap Causes
In order to solve the gender pay gap, we have to understand the two most important causes:
Men occupying more senior roles while women occupy more junior positions (within-occupation segregation)
Men and women working different types of jobs (across-occupation segregation)
To address within-occupation segregation, companies need to establish targets and strategies for hiring and promoting more women. Hiring processes, performance assessments, and promotion criteria need to be made as objective as possible.
Explicit Hiring Practices
Introducing more objectivity and less bias to these activities can be done by:
Agreeing to evaluation criteria in advance. This makes it easier to evaluate candidates with different experiences and backgrounds.
Using panel interviews instead of one-on-ones makes the interview process fairer.
Eliminating unconscious biases may encourage more women candidates. For example, words like “competitive” and “dominant” are less appealing to women and may discourage them from applying. These types of words should also be removed from performance reviews in order to get an unbiased assessment of skills and accomplishments.
Removing unrelated facts and anonymizing resumes can remove potential biases based on factors like candidates’ names and photos.
Across-occupation segregation is a difficult issue to resolve because it is harder for employers to influence. However, assessments are being used by some companies to test for abilities that might not be obvious. For example, a tech start-up called Pymetrics has software that is making links between certain aptitudes and unlikely career matches. For instance, professional linguists can make excellent programmers.
This implies that there are many job opportunities for women that may be in traditionally male-dominated professions. Hiring managers and recruiters need to become aware of this and avoid giving too much weight to the specialized type of schooling or work experience that a person has. Candidates may have skills or training that are not an intuitive match for the job, but they may bring unique perspectives and abilities that are very transferrable to the role. Being able to recognize this and think outside the box can place more women in historically male-dominated positions or professions.
There are many ways that companies can address the gender pay gap, but the hiring process is a logical place to start. By changing their hiring practices, employers can get more women in the door and move them up the career ladder in a fair and equitable way.