Promotion Inequity Stalls Narrowing of Gender Pay Gap
NATIONAL REPORT — A gender promotion gap is the primary factor behind stalled efforts to further narrow the gender pay gap, according to new data from Yale.
Kelly Shue, a professor of finance at Yale School of Management, conducted research that found women are around 13% less likely to be promoted than men, which is a major driver in persistent income inequality, reported CNBC.
"Women have noticeably lower promotion rates compared to men in the same firm, in approximately the same position," Shue said at CNBC's Women & Wealth event, held Sept. 25.
Shue noted that about 70% of the gender wage gap is due to women occupying different roles compared to men; however, they are paid less even when men and women occupy the same position. Currently, women earn 84 cents for every $1 men earn, according to an analysis of U.S. Census Bureau data by the National Women's Law Center.
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Although women have made significant progress in corporate America, system bias and other factors mean barriers remain in place. According to the annual Women in the Workplace study from Lean In and McKinsey, women are less likely than men to be hired into entry-level roles, and from there, are slower to advance to manager and director levels, with 81 women promoted for every 100 men.
"Because of this 'broken rung' in the corporate ladder, men significantly outnumber women at the manager level, making it incredibly difficult for companies to support sustained progress at more senior levels," Lean In noted.
Unconscious bias can also be a factor, according to Shue, who described how people's mental pictures of the most successful managers often have stereotypically male qualities such as having an aggressive leadership style, embracing competition and more. Common advice often focuses on ways women can change their behavior and self-advocate.
"I think that could be affective, but I would also argue that instead of putting all of the burden on women to behave differently, and to advocate for themselves, it would be great if firms and the managers in charge of these decisions also stop rewarding ... this aggressive behavior to the same extent and instead just recognize that many female workers actually have high potential," Shue said.