Why women bosses pay themselves less

This is a tricky issue. A recent article in Forbes tries to understand why women executives pay themselves less than comparable male managers –– the same 76% seen elsewhere. One answer is that female-run businesses are often smaller. But studies correcting for that difference have found the same pattern. Before we write this off to internalized oppression, let’s consider one other answer, a more poignant and important one. Successful women may have a different value system, one less driven by competition, greed, and instant gratification. Women seem more willing to think about the interests of everyone in a company, and not just themselves.  Studies show that women also seem more oriented to long-term goals. See “Even When Women Write Their Own Checks, the Gender Pay Gap Persists” by Meghan Casserly.

“New research indicates that, even when women are their own bosses, the gender pay gap persists,” Casserly writes. Casserly says that “According to the 2012 Catalyst report on women’s earnings, full-time, year-round women workers earn an average of $36,931 compared to men’s $47,715—or 76 cents to every dollar earned. Unfortunately, even when women write their own paycheck, there’s no escape—female CEOS pay themselves just 76 cents on the dollar to what a male entrepreneur takes home. In new research from American Express OPEN one of the most surprising pieces of insight is on take-home salaries. When female entrepreneurs pay themselves a salary (and they do just 41% of the time in contrast with 53% of their male peers), they earn $60,000. Male founders write themselves much fatter paychecks–$78,000 on average.

“Men tend to place a higher value on their work and the hours they put into the company’s success—an attitude Weeks and Womenable hope to see women adopt over time. ‘The point of view that I’m here, I’m working and I deserve to be paid is quite legitimate,’ Weeks says, “But it’s much less common in women than in men. The female entrepreneurs she studies take a much more delayed gratification approach when compensating themselves financially. They work hard, she says, but often tell themselves they’ll take returns on their investment much further down the road. ‘Women pay themselves last… Or at least not first.”

2 Replies to “Why women bosses pay themselves less”

  1. Another interesting facet of gender. It provokes questions about how the different gendering of men and women plays out in a capitalist system. Unfortunately the article seems to imply that women need to be more self focused so as to eliminate the pay gap. This may also have the effect of eliminating the positive qualities of looking after staff. Perhaps another approach would be to look at the goal of male manager’s reducing their pay in favour of better conditions for the workforce.

  2. This comment admirably points to the complexity of these issues and their always-contextual character. But taking a look at workplace fairness and unfairness is important, since we now know that law and regulations mandating “equality” cannot by themselves change broader cultural patterns and biases. The task is a relentless and ongoing institution-by-institution critique, which will always be subject to revision and correction despite everyone’s best efforts. Thanks for bring your voice to these pages, Cassandra.

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