Women lose out on salary. Can they do anything about it?

Women get paid less than men by between 10 and 20%, according to EU economists. This can be a staggering amount of money over a lifetime of work. Yet new research published by Benjamin Artz, Amanda Goodall, and Andrew J. Oswald in the Harvard Business Review in June, 2018, on a sample of over 4,000 Australian workers shows salary differences are not down to the fact that women don’t ask for pay raises, as thought previously.

It seems that women’s “asking” behavior is the same as men’s, including MBA cohorts. So, what does the difference in pay boil down to? One reason might be how women go about negotiating their raises in the first place.

Leigh Thompson reports in her book The Mind and Heart of the Negotiator that even female managers at major companies fall for the pervasive cultural stereotype that “women are docile.” Thompson found that knowledge of these stereotypes is a “mental roadblock” for women. When these stereotypes were explicitly mentioned in lab negotiations, female MBA students outdid their male counterparts when claiming value. Exposing negative stereotypes means women can do far better at the bargaining table.

Suzanne de Janasz and Beth Cabrera writing in the Harvard Business Review in August, 2018, explain that 20% of women never negotiate salary. Research shows that women really fear that bargaining over salary will result in them being disliked. Janasz and Cabrera also claim women are less aware of their true value in dollars and more uncomfortable expressing it.

Women can combat this by boosting their negotiations skills with training and role play practice, as my students do in Negotiation Skills class at ESADE. Some pointers for how women should go about their salary negotiation include:

  • Prepare to justify your pay raise claims with your real contributions
  • Investigate what your job pays in the market and what your company’s salary bands allow for.
  • Think about your compensation in a wider fashion, not only salary, but bonus, vacation, etc., as an overall package
  • Set priorities on the package and think about what’s important to the other side
  • Avoid threatening and aggressive moves using outside offers if you really want to carry on in your job

Finally, one last word of advice, this time from academic Adam Grant, who claims that women need to forget their natural tendency to be givers and increase their assertiveness in salary negotiations. His tip is for women to think of themselves as agents representing the interests of others, perhaps their families or others that matter to them, so they can comfortably express their value in dollars at the salary negotiation table.

Por Steven Guest


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