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Female graduates earn less than their males peers. This is how some CEOs are fixing it

/ Jun 23, 2014 8:04AM / Print / ()

A recent study by Graduate Careers Australia found that male graduates earn 9.4% more than their female counterparts when they enter the workforce. A significant proportion of this difference (5%) can be explained by the educational, personal, enrolment and occupational choices of women and men. The remainder, 4.4%, is unexplained and potentially due, in some part, to bias or discrimination.

This study has raises important questions for Australian society. If we believe women and men should have the same financial opportunities, then we need to confront the gender stereotypes we perpetuate that encourage women to pursue 'softer' subjects at school and avoid the 'harder' subjects such as science and maths, that ultimately lead to better remunerated occupations.

Stereotypes that are reinforced from birth define appropriate behaviour for boys and girls that set the benchmark against which we are rewarded. Girls are acknowledged for a pretty dress; their caring and compliant behaviour is congratulated. Boys are encouraged to be tough and competitive while their physical achievements are applauded. These stereotypes are entrenched by the toys we play with and the mass-media messages we absorb to ultimately influence the subjects we study and the careers we dream of.

Shifting society's expectations of women and men is a massive task. The first step is understanding the cost, and we now know the cost for women is reduced earnings at the start of their careers and the gap in male and female earnings only grows over time.

The GCA report notes there are a number of factors that its study didn't account for that could go some way to explaining the 4.4% unexplained gap. I would suggest a decent proportion of that gap is due to gender bias.

We know that extensive academic research shows gender bias in the workplace operates on many levels, often at an unconscious level and generally throughout a woman's career. For example, research shows the widely accepted characteristics of a natural leader are inherently masculine, which sets a challenging benchmark for women to reach given they are socialised to be feminine. Another body of research shows women are rewarded on past performance while men are rewarded on future potential. Catalyst research shows 'hot' projects that are highly visible, mission critical and/ or international are more often awarded to men.

The research on women and negotiation is also relevant in this discussion. Because we are socialised to view women as compliant, when women negotiate they are more likely to be viewed as aggressive. Women don't lack the skills for self-promotion but they fear being judged harshly, making them reluctant to promote themselves in the workplace.

So many women I speak to can relate to this fact. The pay rise they didn't push for, the job they didn't apply for, the project they didn't put themselves forward for.

While much of this research highlights biases that are perpetuated after career commencement, they are instructive for understanding how gender bias operates. It's often unconscious, generally unavoidable and operating across multiple points of the talent management process – who you hire, promote and reward. It stands to reason that it will also impact, to some degree, the pay offered to male and female graduates.

I recently spoke with a number of CEOs to gain insights into a pay equity campaign the Agency is launching later in the year. I wanted to understand why CEOs invested the time and resources on conducting detailed pay equity audits. These companies evaluate every job to confirm that men and women doing the same work at the same performance level are remunerated equally. They do those audits, mostly annually, because they know gender bias means women will sometimes be paid less than men. It's not always widespread or systematic but it happens. So they look at the data and they fix the unexplainable or unjustifiable gaps.

It's important to realise gender bias is a fact of life. We all have our biases and we need to see them, call them out and hopefully limit their influence on our decisions and behaviours – whether it's the career advice we give our daughters, or the way we evaluate the performance of women and men we work with and what we pay them.

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