Even in liberal Boston, there’s a gender wage gap
Working women in Greater Boston make 77 cents on the dollar compared to men — a gender wage gap that echoes the national average — according to a report released Thursday by the Boston Women’s Workforce Council.
The report, which collected anonymous wage data from 112,600 workers at 69 companies, is the first in the nation to analyze the gender pay gap using employer data, according to the study authors. Previously, wage gaps have been calculated using employee-reported salaries, which are considered less accurate.
The average annual salary for women in the Boston area is just under $79,000, while men make more than $103,000 on average. Men also earn more than twice as much in bonuses, bringing in $11,000 a year compared to $4,000 for women.
The biggest pay gaps were among service workers, laborers, and executives, with women earning between 61 and 68 cents on the dollar compared to men. Among administrative assistants and midlevel managers, however, women earned slightly more than men.
Nationwide, estimates for the gender wage gap range from 77 to 84 percent. These figures do not account for differences in occupation, education, and experience between men and women, however. When those factors are accounted for, the gap shrinks to less than 10 cents. Controlling for these differences, college-educated women working full time one year out of college are paid 7 percent less than their male peers, according to the American Association of University Women.
This unexplained 7 percent gap, which is there from the beginning of women’s careers and puts them on an unequal footing from the start, is widely assumed to be the result of gender discrimination, and the gap grows as women move through the ranks.
Mayor Martin J. Walsh said he was not surprised by the report’s findings, but is encouraged that so many companies participated voluntarily.
“We’re able to take this information and really use it as a data point to find out where we’re doing good and where we’re doing bad and where we need to do better, which right now I’d say is almost everywhere,” Walsh said at a press conference.
Walsh noted that he intends to share the data with business groups and at the upcoming US Conference of Mayors, and to continue the city’s salary negotiation workshops to teach women how to ask for higher pay. He has no plans to offer incentives to nudge companies toward pay equity, however.
“I’m not open to rewarding companies for doing something they should be doing anyway,” he said.
The data was collected as part of a three-year effort to tackle Greater Boston’s gender wage gap, launched by former Mayor Thomas M. Menino. More than 175 businesses have signed a compact agreeing to examine their salary data.
The council intends to collect salary data every two years, expanding the number of companies and measuring progress toward closing the wage gap. The reporting system, developed by computer scientists at Boston University, allows companies to input sensitive pay information anonymously. The data is so masked, in fact, that the council does not know which companies took part.
The results do not fully represent the makeup of the overall labor force inside the Interstate 495 belt, where the 69 companies are based.
These companies had a greater percentage of female employees — 58 percent — than this segment of the Greater Boston workforce as a whole, which is about half women. Because women are generally paid less than men, and the study included more women than the larger labor force does, the 77 percent wage gap could appear larger than it really is, the study authors caution.
The number of women employed in higher-paying job categories was also larger in the study sample than in the workforce, which could further skew the data.
The study outlines four ways companies can work toward wage equity: creating internal goals, hiring and promoting more women to senior positions, providing workplace flexibility, and promoting pay transparency.
It makes economic sense for companies to pay their employees equitably, said Alison Quirk, chief human resources officer at State Street Corp., one of the lead employer sponsors of the initiative. Women who know they are being paid fairly are not only more dedicated to their company, they produce better work.
Representatives from State Street and fellow sponsor Massachusetts Mutual Life Insurance Co. both said they have been committed to closing the wage gap for years. At State Street, managers have undergone unconscious bias training, and an effort is underway to get more women into high-level positions. MassMutual hired an outside adviser to analyze wages and is working to ensure that their interviewing panels are as diverse as their job candidates.
Massachusetts legislators passed a pay equity law last year intended to close the gender wage gap by preventing employers from asking salary histories and banning employees from discussing their wages. But the mayor and members of the workforce council questioned how far the law could go.
“We can’t solve this by legislation. We’ll never legislate our way through this,” said Evelyn Murphy, the former lieutenant governor of Massachusetts and cochair of the Women’s Workforce Council. “It’s actions by all of us. Women have to act for employers to react. Employers have to act to make this change.”