Girls, Help Me Raise a Glass for the College Grads
Beyonce may say girls run the world, but many women are still fighting to get paid for it.
Interestingly, men were more optimistic than women: 68% of women but only 44% of men expected to earn less than $50,000 in their first job.
But recruiters are likely to leave them disappointed. Almost half — 48% — of companies paid entry-level employees less than $35,000, and only 23% paid more than $50,000.
The good news is that recruiters are open to negotiation over salary. Six out of 10 said their company was likely to negotiate over entry-level salary, confounding the belief of half of college seniors that it was not possible to negotiate.
In a reversal of the gender difference over salary, women had more faith in their ability to negotiate a higher salary, perhaps reflecting a greater confidence in communication skills.
Am I the only one thinking that maybe the reason women have to “have faith” in their ability to negotiate a higher salary is because they know they’re going to have to fight for one? The majority of men in the study assumed they would make more than $50,000 in their first job. Perhaps they didn’t believe they would have to negotiate. The smart young women of the class of 2016 seem to realize however, they’re going to have to keep up the fight for pay equity, starting at the beginning of their career. To say that women are optimistic because they are “good communicators” is a bit trite, at best.
I had dinner with an executive recently who shared a story about hiring for a new director of marketing. At the beginning of the job search this executive sat down with their compensation analyst and came up with a target salary – let’s say it was $100,000 for the sake of round numbers. There were two strong candidates, both happened to be women. Candidate A previously made $95,000 a year, and candidate B made $75,000. Candidate B was the preferred choice, and when writing up the offer the recruiter asked what they’d like to put as the salary. The executive replied $100,000, and the recruiter said that they couldn’t possibly make that offer – it was a third more than she was making before! The executive (incidentally a male, who perhaps not incidentally, had a daughter getting ready to enter the workforce) argued that if that was the rate the company’s own analysis had decided was a fair market price for the skills they were looking for, how could they NOT make that the offer?
Could the same scenario have happened with two men? Of course. And of course companies have every right to find talent at the most affordable rate. But think about your organization’s practices. Are you willing to make a step change in compensation when an individual’s skills have made a step change in value in the marketplace? Whether they are internal or external, valuing the contribution and the scarcity of skill should always supersede a “percentage markup” on previous salary, if we want to be equitable to male and female employees.
A study from Catalyst found that “women were paid about 90% of what men earn until age 35, at which point median earnings for women start to slow down, further widening the pay gap.” This makes sense following the rules of compound interest. If you start out with a 10% differential, even if raises are given at the same rate, at the same time throughout their career, women will end up significantly behind their male counterparts. So particularly to all the young women graduates were heading into the workforce, you probably will have to fight for that entry-level salary. But it’s worth it. Because until the world changes, where you start may dictate where you end up.