Gender Pay Gap --- Will Gen Y Save The Day?

I’ve been thinking a lot about Gen Y lately. Specifically I’m wondering what impact they’ll have on compensation in the workplace.

Today Gen Y are 21-33 years old and 34% of the workforce.  In 2020 those numbers will be 32-54 and 56%.  That’s a big change in workplace demographics.

Between now and then most of the “old guard” --- today’s top management --- will have retired.  This will also be a big change. So what about Compensation?  Will it change as well? 

Let’s take the gender pay gap issue.  A recent survey by Pew in December, 2013 shows pay for women is 93% of men in the 25-34 age group versus 84% in the total workforce.  So the gap seems to be closing for younger women, but then they are not as far into their careers as older women.

There are a lot of theories about the pay gap but there's no space to go into that here.  Suffice it to say that once all the obvious factors have been accounted for, there is still a gap that cannot be explained.  I suggest it may be because of the views that older Boomer men have of working women.

As a Boomer I remember that mothers didn’t work outside the home.  The few that did, worked only until they married and occupations were limited to nurses, teachers, librarians and secretaries.

Boys were told by their parents they could be anything they wanted to be when they grew up.   Discussions with girls revolved around marriage and taking care of a household and children. 

As these Boomer boys grew older, started working and were promoted into management, they carried their traditional beliefs with them and that affected their attitudes towards working women.

Let’s look at the difference in how Gen Y were raised.  Most were raised in households where both parents worked.  Given that, boys and girls reared by a working mother entered the workforce with more egalitarian attitudes than those reared in traditional families.  Girls were told they could be anything they wanted to be --- like the boys.  There are more differences, but space does not allow details.

As Gen Y women moved into the workplace, Boomer management viewed them as eventual mothers and hesitated to encourage their careers thinking they would end up quitting their jobs.

Companies did make some adjustments by creating maternity leave, part-time jobs and allowing flexible working. However, these arrangements often caused women to miss out on vital career experience, pay and promotions.

Oddly enough, Gen Y men don’t view a career in the same way as their fathers.   They remember all of the long hours their fathers worked --- as well as the lack of family life   To them being a father is not about being an economic provider --- it’s about spending time with family. They want schedules that work around family needs --- just as women have been demanding for years.

So children and family life seem to be the “sticking point” with Gen Y.  This is where Compensation comes in. 

We might need to review Compensation packages and see if more emphasis needs to be placed on benefits.   Out-of-touch policies that no longer fit the norm may need to be changed. 

The fact is that the sheer number of Gen Y employees is going to require some changes.  Until fathering is considered as valuable as mothering both the pay gap and the glass ceiling that women experience will likely stay firmly in place. This same glass ceiling holds women back at work and men back in the home.

Google has already taken steps.  They increased family leave (women and men) from three months to five and made it fully paid. By doing so they saw a 50% drop in the number of mothers who quit.   Others are also moving in the direction of offering paid family leave, recognizing that these kinds of family-friendly policies not only boost morale, productivity and loyalty, they also address the other factors that contribute to the pay gap.

What do you think about my “theory”?

Jacque Vilet, President of Vilet International, has over 20 years’ experience in Global Human Resources with major multinationals such as Intel, National Semiconductor and Seagate Technology. She has managed both local/ in-country national and expatriate programs and has been an expat twice during her career.   Her true love is working with local national issues.  Jacque has the following certifications:  CCP, GPHR, HCS and SWP as well as a B.S. and M.S in Psychology and an MBA.    She belongs to SHRM, Human Capital Institute and World at Work.   Jacque has been a speaker in the U.S., Asia and Europe, and is a regular contributor to various HR and talent management publications. 

Comments

[E. James (Jim) Brennan]

That seems to ring true, Jacque. Women's work continues to be devalued, with the NAS's part-correlation formula still accurately capturing the gender gap for ~"identical" work. The new Pew survey found close to the same shortfall Dr. Risher calculated among peer ACA members in 1981, but doubt they matched credentials and experience as precisely as his stepwise regression study.

I wonder if a future where "fathering is considered as valuable as mothering" would result in women earning more or fathers earning less as they accept traditional female roles?

[Jacque Vilet]

How timely. Read this article from today's New York Times on this "parental leave" subject.

http://www.nytimes.com/2014/08/10/upshot/can-family-leave-policies-be-too-generous-it-seems-so.html

[Jacque Vilet]

Jim --- The answer to your question would be "yes" only if the traditional Boomer attitude remains in top management. But keep in mind these guys (yes, guys) will be gone replaced by Gen Y. Their values/attitudes will change companies' views of women regardless.

With Gen Y men wanting better family life even as they become the "new" management, there won't be this "earning less or more" issue. Just an assumption that men have as much right as women to take time off/not work 24/7.

And this equality in family sharing will not have negative impact on careers. If everyone values it --- there's no downside.

[Trevor Norcross]

I think gen Y maybe the first generation where the male female pay issues normalizes but let's not overlook the stepping stones that other generations have created. Boomers and the forgotten X'ers have each made the strides the society was ready for. I believe we still have a ways to go with other minority groups as well.

When you look at the decreased pay gap (93%) between men and women in the 25-34 age group is it gen Y making these decisions or gen X? I don’t know the answer but curious about who is typically managing this group. Is it better to judge Gen Y by the pay differences in the generation after them?

So I guess I’m suggesting that the changes are not solely driven by Gen Y and as part of Gen X maybe trying to take our share of the credit.

Jacque, can you also clarify the age of gen Y now vs 2020? The age range goes from 21 to 33 today and then 6 years later (2020) is 32 to 54 (I hope they don’t age that fast). If the first gen Y's were born in 1980 they will only be 40 in 2020. Are you sure that 54% of workforce population does not include Gen X? We are often forgotten but hopefully have not disappeared. ;)

[Jacque Vilet]

Agree the older guys made some good decisions but not in this area. And yes Gen X no doubt contributes to decrease in pay gap. And new hire rates are increasing for women which could be driven by pay expectations and Gen X/Gen Y hiring managers.

I apologize for the error in dates. There are so many opinions on the date ranges for Gen Y it's anybody's guess. I went with the Conference Board's stats. Gen Y age range today is 21-33.

2025 should be the future date rather than 2020. Again -- sorry for the confusion. Too much info to look through. That means that in 2025 the age range will be 32-44.

And sorry again but Gen X apparently just isn't that "sexy"!! All focus seems to be on Gen Y. And 54% is accurate.

[Molly Schissler]

I agree with Trevor - let's not discount Gen X's role in trying to level this playing field for Gen Y and beyond. And I truly hope there are enough enlightened Gen Y'ers to continue to improve things for everyone (not just male/female issues).

[Jacque Vilet]

Hi Molly ---- I agree that Gen X deserves some credit. Just not anything written about them. The difference between Boomers and Gen Y is so obvious I guess that's why we don't hear anything about Gen X role in this. And you are right --- there are more pay gaps out there besides women. This one, however, is the "hot" button right now I think because the womens rights groups are so vocal.

[Trevor Norcross]

Thanks Jacque, I think a lot is written about Gen Y because they are a large group and are first to grow up in the digital age. They have seen the social contract change for Boomers and Gen Y and changing their expectations about work. Every generation learns from the ones before and makes changes based on what society is ready for. The pace of change is speeding up which makes the future less predictable.

Maybe there should be more written about Gen X lest we forget that everything happens in stages.

Great discussion.

[Tony Bergmann-Porter]

I'll believe this is a problem when the people who tell me it's a problem start to act as if it were a problem:

http://www.huffingtonpost.com/2014/07/08/white-house-gender-pay-gap_n_5568057.html

[Tony Bergmann-Porter]

And by the way, this wage gap stuff has been so thoroughly debunked that nobody should be able to present it with a straight face any more.

http://www.huffingtonpost.com/christina-hoff-sommers/wage-gap_b_2073804.html

[Trevor Norcross]

Hi Tony, I agree that the numbers can be misleading and I think it is a matter of time before the discussion changes from pay gap to job level gap.

Do you think there is still a societal bias that leads women to believe they need to be the primary family care giver? Do you think society has a bias that makes it more acceptable for men to enter STEM careers than women? I think this is also starting to change but the bias still exists.

The numbers are still misleading because there is still an underlying issue.

[Tony Bergmann-Porter]

Hi Trevor. Yes, I think you have exactly pointed out the real issue, occupational preferences. The more interesting question is whether these are entirely culturally driven, or if they arise from some more innate reasons.

http://www.resolutionfoundation.org/media/media/downloads/The_price_of_motherhood_-_women_and_part-time_work.pdf