Chicago Tribune

November 5, 2003 Wednesday, CHICAGO FINAL EDITION

SECTION: Woman News; Pg. 1; ZONE: C

HEADLINE:

A crummy situation;

Despite workplace gains, women still aren't making the dough that men are

By Joanne Cleaver, Special to the Tribune.

As any 3-year-old can tell you, boys and girls should get the same size cookies at snack time. Especially when they are good boys and girls who get along in the

sandbox.

Unfortunately, toddler logic doesn't apply to the workplace. The stubborn gender pay gap still means that when a boy gets a whole cookie, the girl sitting next to him gets 78 percent of a cookie. And this is during a period of unprecedented sandbox cooperation: U.S.workplace productivity is at an all-time high, according to the Bureau of Labor Statistics. American women are working harder than ever at their jobs, producing more than ever (just like the guys), and continuing to shoulder most of the domestic workload when they get home (unlike the guys).

For all this effort, most women get paid 22 percent less than white men.

The good news is that the gender wage gap has just narrowed a bit. A year ago, the Bureau of Labor Statistics reports, all women were paid 76 cents for every dollar earned by white men, the highest earning group. The BLS announced in September that the gap has improved by two pennies.

There also is good news for younger women, who start out with less of a wage-gap handicap: 25- to 34-year-old women make 84.7 percent of what their male peers earn. And researchers are starting to unravel the stubborn mystery of why women who clearly perform well at work still make less than men with equivalent jobs.

But the bad news continues to be the main news. The wage gap is remarkably obstinate. It resists education, job experience and professional advancement. Researchers say that the pay gap appears to be so ingrained in corporate and societal culture that it doesn't budge even under pressure from the collective performance of the U.S. women who make up 47 percent of the work force.

While the "78 cents" figure is a handy summary of the situation, it obscures both gains and setbacks experienced by women of different ages, races and educational status.

"The 78 cents is a complicated number," says Laime Vaitkus, editor of "The State of Gender-Based Pay Gaps 2003," a report produced by the Institute of Management & Administration, a New York City research and publishing company. "The number takes every working woman in the country and compares it to every working white man. In some fields, and some salary levels, the pay gap is explainable, or there isn't one."

In many cases, she pointed out, women make deliberate decisions to go into fields that pay less than most jobs held by men or to wield their highly developed skills--such as accounting--on behalf of a non-profit or government employer, which tend to pay less than private industry.

Women would seem to be at an advantage in their mid-20s, pointed out Vicki Lovell, study director for the Institute for Women's Policy Research, a non-profit based in Washington, D.C. After all women outnumber men in both undergraduate and graduate programs, according to the National Center for Education Statistics. Women fresh from college or graduate school get paid 84.5 percent of what their male peers earn, according to the BLS.

The almost-parity party doesn't last long. By the time they have been on the job for five years, women's pay starts to fall seriously behind men's, Vaitkus said. "It's a subject of big debate how that gap starts or grows," she said.

Starting a family and adding domestic responsibilities often motivates a woman to rotate into a less demanding job so she can balance home and work more easily. Doing so usually stalls her progress on the pay scale, as reduced responsibility is usually accompanied by smaller raises or even a pay cut. Just a few years of salary stall reverberates for decades.

Less well-intentioned forces are also at work, say those who study the pay gap.

"Over time, most women will experience some number of incidents where they are offered a lower wage, or their performance was evaluated differently, or you step out of the labor pool, or downshift in your regular job, and you lose momentum," Lovell said. "While men continue to move ahead steadily."

The net result: By the time women reach midcareer and midlife, they are making less than three-quarters of what their male colleagues make.

Lower pay is bad enough on an everyday basis--when it's time to pay the mortgage and buy new shoes for the kids. It really adds up to a whole lot less as the years pile up and the dollars don't.

Women can't catch up if their raises are calculated on salaries that were lower to begin with. Men's raises, based on higher beginning pay, snowball faster. A man who makes $100 and gets a 3 percent raise, for instance, then makes $103. A woman with the same job who makes $78 and gets a 3 percent raise then makes $80.34. The next time they each get a 3 percent raise, his pay rises to $106.09 and hers to $82.75, and their wage gap widens by a tenth of a point to 77.9. They each make more, but the difference between their pay grows.

Meanwhile, less take-home pay means that it's harder for women to save for their retirement. The less saved early on, the less money there is to earn investment income that grows over time.

The AFL-CIO has calculated that today's average 25-year-old working woman will lose more than $523,000 over her working life due to unequal pay--and that's assuming that she was just as good at her job as her male co-workers and got the same percentage raises along the way.

Researchers have been at a loss to explain why women perform so well for their employers and so poorly for themselves.

Carnegie Mellon University economics professor Linda Babcock thinks she might have figured it out.

Babcock conducted research not on how women negotiate for what they want, but why they don't negotiate to begin with. For instance, all students about to graduate from the master's program she oversees were coached in the nuances of negotiating their first job offers. But when an actual offer was presented, only 7 percent of women even tried to negotiate their starting salary; 57 percent of the men did.

That directly resulted in the newly graduated women starting at lower salaries, touching off their personal wage gaps.

"It's pretty terrifying," Babcock said. She found that women assume they will be offered more money. They simply don't ask--hence, the title of her book, "Women Don't Ask" (Princeton University Press, $24.95). Even seasoned women in midcareer don't try to negotiate for what they want at work--flex time, a more high-profile project or a bigger raise.

Failing to ask feeds the pay gap, contends Babcock. Say a negotiation-shy woman grad student accepts an employer's first salary offer of $25,000, while her male counterpart negotiates to start at $30,000. If each of them gets 3 percent annual raises for the rest of their careers, he makes $15,000 a year more than she--$92,243 compared with $76,870--by the time they both are 60. However, in that 38 years, he earned a total of $361,171 more.

The irony is that women are actually pretty good at negotiating on behalf of their companies and their work projects, pointed out Babcock.

"It's only when it comes to asking for themselves that they aren't," she said. "There are a number of reasons why women are so quick to settle. The basic underlying reason is that girls are socialized differently--not to be assertive, and to be sensitive to the needs of others. Our society has a double standard for men and women. Men are perceived as being go-getters. Women are perceived as aggressive, bossy, pushy ... and other things that you can't print."

As well, women may not have enough information to assess how fairly they are being paid. "If women are comparing themselves to other women, and women make 75 percent of what men do, they may not realize they are underpaid," Babcock said.

Melissa Josephs, director of equal opportunity policy for Women Employed, a Chicago non-profit that assists working women, says that Babcock's findings are consistent with the types of pay-related complaints she hears. "People trust their managers to pay equally," she said. Women need to realize that often, managers expect them to initiate requests for more pay or a better commission structure. Those who ask, get, Josephs contends.

To really change the wage gap, lots of women will have to ask, said Michele Leber, chair of the National Committee on Pay Equity, a Washington-based advocacy group. The combined voices of many women asking will not only change their own pay but also will make it normal to ask, she said.

You can't protest what you don't know. If you aren't armed with facts about how your employer pays men and women, it's impossible to persuade the powers that be to bring women's pay in line with men's.

Many employers have policies or cultures that discourage employees from swapping hard numbers about their salaries, bonuses and commissions. It is up to human resources managers to examine their own companies' pay practices to see whether they are fair or not. They are the only ones with access to confidential salary data ... and they enforce their companies' equal-pay policies.

However, it seems that gender pay equity is one topic that human resources managers won't touch.

The Institute of Management & Administration, a New York research and publishing company, surveyed HR managers last spring and found that 87 percent believe there's a gender pay problem at other companies, but 80 percent think there is no problem at their own companies.

Women in Illinois have an extra tool: The Equal Pay Act of 2003, passed in May, covers all employers with at least four employees and requires them to pay men and women the same for the same work. It also protects Illinoisans from being fired for talking about what they earn with co-workers.

Still, it stops short of requiring employers to reveal compensation numbers or pay patterns to employees, says Angela Mersch, an associate with the employment practice of Chicago law firm Wildman Harrold Allen & Dixon.

It's up to employees to dig up proof of a problem and present it to the employer. So far, real change has mainly come about through lawsuits filed by women ex-employees, says Francine Moccio, director of Cornell University's Institute for Women and Work, though the Illinois law is so new it has not sparked many complaints yet.

The proposed federal Paycheck Fairness Act fills in some of the gaps of the 40-year-old Equal Pay Act. One of its main provisions would require companies to report the state of gender pay equity among their employees, says Debbie Chalfie, senior counsel with the National Women's Law Center. The Paycheck Fairness Act is stalled in congressional committees.

"It would help a great deal, if companies had to monitor the gender wage gap," Moccio says. "You can have pay equity laws in the books, but you have to have enforcement to build in motivation for companies to evaluate their pay."

How much will the pay gap cost you?

Use the AFL-CIO’s website to calculate at http://www.aflcio.org/yourjobeconomy/women/equalpay/calculate.cfm