Equal Work Deserves Equal Pay: Time for Fair Compensation

March 15,2023 : March 14, 2023, marks this year’s Equal Pay Day, which is the day that a woman would have to work through to receive the same pay as a man did in 2022. Women still make only 84 cents on the dollar compared to men and 77 cents compared to white men, with even more significant disparities for women of colour. Black women receive only 67 cents on the dollar, and Latinas and Native women won’t reach parity until October 5 and November 30, respectively, meaning they effectively work almost two years to make what a white man makes in one. COVID-19 has exacerbated this pay equity problem, as women were nearly twice as likely to be economically impacted by the pandemic. Women are more than 50% of America’s population but makeup only 8% of CEOs of Fortune 500 companies, with only two of the 41 female CEOs being Black.

To improve gender equity in the workforce, CEOs should sponsor women leaders, develop a compensation philosophy, and conduct regular studies. Research shows that sponsorship, where a person who has power uses it for someone else, is more critical than mentorship. Male business leaders should work to expand their comfort zone and mentor more women, particularly women of colour, and more companies should offer official mentoring opportunities. Organizations should develop a clear compensation philosophy by working with compensation specialists to evaluate aligned markets and create fair compensation ranges. Conducting regular compensation studies is also a helpful tool.

Creating more and better opportunities for women in leadership and paying all women equal pay for equal work leads to better outcomes. Businesses, where women held 30% of positions and 20% of senior leadership roles, were nearly one and a half times more likely to enjoy sustained and profitable growth. Furthermore, working to improve gender equity in the workforce and other areas after COVID-19 could add as much as $13 trillion to global GDP in the next seven years.