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U.S. Study on Gender Pay Equity Discovers New Key to Closing the Gender Wage Gap: The Manager Divide

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Analysis uncovers definitive link between the underrepresentation of women in manager positions and the gender wage gap in US enterprises

A new study from Visier, the leader in Workforce Intelligence, has found that mothers in the US continue to pay the price in career advancement and wages for starting a family. The Visier Insights™: Gender Equity report, published today, uncovers a direct correlation between the Manager Divide, a growing underrepresentation of women compared to men in manager positions from age 32 onwards, and a widening of the gender wage gap for large US employers. The report finds that eliminating the Manager Divide, which coincides with the years in which women typically have children, would cut the gender wage gap by nearly one third. Download the Gender Equity report. “Every CEO should be looking at gender equity,” says John Schwarz, Founder and CEO, Visier. “Countless studies have shown the equal economic contribution women make in the workforce, yet companies have struggled to achieve the goal of equity in compensation. With this Visier Insights report—made possible by the contribution of our customers to our unique workforce database—we give leaders the factual basis on which to implement programs that can accelerate gender equity. It turns out that the gender inequity is not just a compensation issue, it is a problem of unequal participation of women in the higher paying managerial jobs.”

The Gender Wage Gap

Numerous studies highlight that the gender wage gap cannot simply be explained as “unequal pay for equal work.” Rather, they have proven gender pay inequity to be a systemic challenge where women as a whole earn less than men on average, and do so across education levels and occupations. As discovered by Visier Insights, the gender wage gap is driven by the Manager Divide: gender inequity in manager positions that is closely tied to the childcare years, when women experience increased demands from their home life. “Having a child shouldn’t undermine the earning potential of women, but our study shows that it still does,” says Schwarz. “I believe employers today have good intentions to achieve gender equity, but have been lost in chaotic and conflicting data sources. Business leaders need to be  making decisions based on confident knowledge, not on guesswork. We at Visier are on a mission to enable that.”  

Key Report Findings

Based on analysis of a workforce database representing dozens of large U.S. enterprises, the Visier Insights study found:

  • There is an increase in voluntary turnover and a pronounced dip in the percentage of women in the workforce between the ages of 25 and 40 (from 43% to 39%), the same age range in which women commonly have children

  • The gender wage gap widens at age 32, starting with women earning 90% the wages of men, and decreasing to women earning 82% the wages of men by age 40

  • Women are underrepresented in manager positions from age 32 onwards—the same age at which the wage gap between men and women broadens

  • Manager wages are, on average, 2 times that of non-manager wages

  • Having the same representation of women in manager positions as men would reduce the gender wage gap to 10% across all age groups -- an improvement most notable for the age 32 and older population

Read the blog: Overcoming the Manager Divide: How to accelerate the path to Gender Pay Equity.

Slashing the Gender Wage Gap by closing the Manager Divide

There are a number of important steps employers can take to make meaningful progress towards closing the gender gap.

  • Implement the Rooney Rule: for every manager position you have open to fill, consider “at least one woman and one underrepresented minority” in your slate of candidates

  • Implement blind screening, removing names (or other gender identifiers) from resumes when selecting candidates for interviews

  • Increase measurement and awareness of gender equity in the rollout or implementation of HR policies, including compensation policies

Additionally, leaders, workers, and community members alike can work to eradicate the gender wage gap:

  • Support meaningful paid parental leave that is equal for both men and women

  • Ensure it is socially acceptable for both men and women to take time off to care for their children

  • Support programs that increase the availability of good quality affordable childcare for all parents

  • Ensure it is socially acceptable for both mothers and fathers to make use of flexible working time arrangements to care for children

  • Develop and support long-term programs—starting in grade school, throughout high school and college—aimed at removing the gender bias and social taboos associated with career choices

Do you have more ideas? Share them with @Visier or use #VisierInsights.

About Visier

Visier’s purpose is to help people see the truth and create a better future—now. Visier was founded to focus on what matters to business people: answering the right questions, even the ones a person might not know to ask. Questions that shape business strategy, provide the impetus for taking action, and drive better business results. Visier delivers fast, clear people insight by using all the available people data—regardless of source. With best-practice expertise built-in, decision-makers can confidently take action. Thanks to our amazing customers, Visier is the market leader in Workforce Analytics with 5,000 customers in 75 countries around the world. For more information, visit http://www.visier.com. Media Contact: Joseph Martorano 415.321.1865 visier(at)sparkpr(dot)com