After switching industries from education to tech, Jess Jones wasn’t entirely sure of what to expect in terms of salary. After all, software engineers earn a lot more than teachers.
So, the 31-year-old New Yorker embarked on a huge amount of research into pay: taking part in career coaching, attending networking events, contacting software engineers on LinkedIn and using the salary calculator of the recruitment platform Hired. The message she got was that she should make herself uncomfortable in salary negotiations – or, as she puts it, to “ask for a number that makes me want to throw up”.
Jones was at a major advantage going into negotiations armed with knowledge about appropriate salaries for her position. But most people don’t come with the same fire power. Research shows that the pay gap, which is well documented, partly stems from the ‘ask gap’: the difference in salary expectations between groups, which undercuts women and minorities in particular. Closing this gendered and racialised ‘ask gap’ can pay major dividends for careers, reducing long-term salary inequality.
The ask gap in salary negotiations
In many fields, men expect higher salaries than women with comparable qualifications. A study of online jobseekers in Argentina found that women ask for 6% less on average – and this gap increases in male-dominated occupations. A survey of US doctors in residency showed that women’s ideal starting salary averaged 92% of men’s ideal.
According to a survey by compensation company PayScale, in the US, the median job offer for women with similar qualifications to men is $69,200 (£49,000). That’s $2,200 (£1,550) less than for men.
These numbers might not seem that worrying on their own. But pay gaps at the start of a career compound. “Over time it builds up, because the percentage of raises is usually based on the base salary, so that accumulates over the years,” explains Zhaleh Semnani-Azad, a management professor at California State University, Northridge. “So, this is where women do miss out long term.” Some researchers have estimated that a difference of $1,000 (£700) in starting salary could lead to a cumulative loss of a half-million dollars (£353k).
A difference of $1,000 (£700) in starting salary could lead to a cumulative loss of a half-million dollars (£353k)
Ask gaps have many culprits, but key among them is the devaluation of women relative to men, and employees of colour relative to whites. Often people internalise these expectations. It can be harder for women to accurately assess their value, says Semnani-Azad. This might lead women to accepting the first job or salary offer, while men are more likely to wait for higher offers to land.
Women may be apprehensive about coming across as greedy or pushy in negotiations, or about hiring managers withdrawing or lowballing offers. In contrast, “in general, men don’t put much thought into these things”, according to Semnani-Azad; men are also more likely to have inflated perceptions of their value. “Men are more comfortable asking, and they don’t need to worry about experiencing backlash.”
The double backlash means that it can be hard for women to ‘win’ at negotiating, no matter which tack they take. “If they’re too forceful or masculine, there’s a negative perception that they’re not collaborative, they’re not cooperative… But if they’re too nice and they’re collaborative or communal, then they’re perceived to be weak, or maybe not as competent,” explains Semnani-Azad. She’s experienced negotiation backlash herself, when it was clear that male hiring managers didn’t expect her to negotiate offers, and started downplaying her achievements in response. This kind of backlash affects women of colour in particular; black women are especially likely to be unfairly perceived as too aggressive in negotiating.
Women are not inherently or universally softer negotiators. For instance, there’s plenty of research showing that “women have been successful if they have been negotiating on behalf of someone else”, says Semnani-Azad. In other words, women are either more comfortable, or viewed more favourably, when they’re not negotiating for themselves – partly because of societal expectations that they be ‘nice’. Of course, there are differences in negotiation styles not only across race and gender, but other factors including nationality and sexuality.
Narrowing the ask gap
One recruitment company tackling this disparity is New York City-based Hired, which is geared mainly toward employees in the tech sector. Because these workers’ skills are so in demand, they have more power than many low-skilled workers. For instance, on Hired, companies first approach prospective employees, rather than the other way around.
It takes a lot to get up the courage to advocate for a high salary, and many fewer women and workers of colour make big asks than white men (Credit: Getty Images)
Like many job-search platforms, Hired used to leave a blank field for each applicant’s desired salary. But in 2018, the company started filling in that field with the median salary for the role, based on data from its users. This simple change eradicated the gender ask gap of 3.3% among Hired users, “mostly because women are asking for more, and slightly because men are asking for less”, says Nina Roussille, an economist at the London School of Economics, who carried out independent research using non-confidential data from Hired. Essentially, after the 2018 change, all of the applicants gained more information on their true value according to the market. This depended on factors like location, with the gender expectation gap being twice as large in London as in the San Francisco Bay Area.
In general, Hired says they are trying to remove the subjectivity from decisions about what salary to offer – on the employee’s side, but also the employer’s. Josh Brenner, Hired’s CEO, refers to this as “providing visibility and guidance”, which makes for a more efficient hiring process all around. For example, Hired sends out salary bias alerts to companies that are offering lower salaries than typical for that role and sector. Granted, not every company changes its tune in response; these alerts lead to changes in offer salaries 4.3% of the time. But when a salary adjustment occurs, it’s significant, averaging $20,000 (£14,000).
Clearly, more wage information is necessary, especially for people starting out in their careers. But it’s not sufficient for closing ask gaps.
For instance, Roussille’s research shows that a 2.5% final offer gap persists for Hispanics using Hired, even controlling for the asking salary. And when employees learn of salary gaps, race affects whether this will actually change. Hired’s data indicates that when white employees point out salary discrepancies, their pay is bumped up 28% of the time. For Hispanics, this happens in only 15% of cases.
What’s needed first is awareness of disparities in ask gaps – and what perpetuates them.
First, companies or governments can end the practice of basing salary offers on people’s previous salaries. “Women are coming in with a history of lower salaries usually. And so, this provides firms with an anchor for women that’s lower than the anchor for men for a given resume. And so that essentially perpetuates the gender gap,” explains Roussille. Positively, “there’s actually now in the US a number of states that banned salary history questions from employers. And there’s early evidence that this has helped reducing both the gender pay gap and the minority pay gap.”
When white employees point out salary discrepancies, their pay is bumped up 28% of the time. For Hispanics, this happens in only 15% of cases
Negotiation training could help, but it would need to be more nuanced and culturally specific. “Existing trainings on negotiation… tend to look at it from more of a universal perspective,” says Semnani-Azad. “And oftentimes, the recommendations of behaviour or the prescribed strategies and approaches are very broad, and there isn’t much consideration for the subsets of these demographic groups and how they themselves react, or how their opponents might react to them.” Plus, such training puts the onus to change on women and minorities, rather than the system stacked against them.
In general, one common suggestion is to foster minority-group networking and mentorship. Yet although that’s very helpful for nurturing underrepresented leaders, it can actually have a detrimental effect on salaries. That’s because when black employees or women take their cues about reasonable salaries from each other, they’re hearing of lower salaries than what white men earn (and tell each other about). This perpetuates a vicious circle of lower expectations. Software engineer Jones was aware of this, and deliberately contacted both men and women on LinkedIn so that her salary expectations wouldn’t be skewed downward.
It isn’t fair that people like Jones have to do so much more research than white men, to have a better chance of appropriate pay. In Jones’ case, it certainly paid off – she ended up with a salary higher than the initial offer for her first software engineering job, and she’s just marked her one-month anniversary in the role.
Until the ask gap is eliminated, she’ll still be telling her friends and peers exactly what she earns. Even though she sometimes struggles with having these touchy conversations, she tells them, “I want to make sure that you get what you deserve.”