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SALT LAKE CITY — The gender wage gap has been a topic of discussion for years, appearing in Utah legislative discussions and in Gov. Spencer Cox's "One Utah Roadmap." Gender differences in negotiations can be a factor in that gap, a group of panelists said this week.
Utah women make 30% less than men, ranking lower than the national average of 18% less, according to the Utah Women and Leadership Project. The 2021 study revealed data consistent with a previous study done by the group in 2017, showing a persisting problem.
According to the report, the gender wage gap can be influenced by a number of things, such as "occupational segregation, structural dynamics of the labor market, human capital or productivity factors, and gender discrimination and bias." Additionally, the disproportionate effect of the COVID-19 pandemic on women both nationwide and statewide could widen the gap further.
Staff shortages across the country and Utah's record-low unemployment rate of 2.1% have opened up a window of opportunity for many. As American workers quit en masse, companies are working competitively to retain or attract new employees. The Women's Leadership Forum, in its first panel, explained the facts behind salary negotiation as it relates to gender differences, skills and strategies and the benefits it carries for both employee and employer.
"The thing about salary negotiations that has been really important is, one, to look at it as a space where we do have agency; we have the potential to self-advocate," said Hannah Riley Bowles, director of Harvard Kennedy School's Women and Public Policy Program. "It's also an area that has eliminated some of the barriers that constrain our behavior and some of the kind of social expectations that motivate men and women to behave differently in certain respects."
Is one better than the other at negotiating?
Numerous studies have been conducted to determine the different determinants of gender outcomes in salary negotiations. One theory for different outcomes is that women underperform when it comes to negotiations.
Assistant Professor of Business Administration at Harvard Business School Julian Zlatev tested that theory. Zlatev and his co-researchers analyzed data from 2,552 MBA students and executives, from five continents, who participated in classroom exercises of salary negotiation. Some students entered negotiations with a strong outside offer while others didn't. A gendered difference quickly emerged.
"When given sort of a low outside offer, men and women actually negotiated for the same general outcome," Zlatev said in the panel. "However, when the outside offer was sort of the strong one, then we actually found this pervasive gender difference in negotiations where men ended up with sort of better negotiation outcomes than women did."
The likelihood that the discussion will end in an impasse nearly tripled for women, the study showed. The strong backup option empowered both men and women to negotiate more assertively but that assertiveness created "a strong backlash against women."
The backlash can be based on stereotypes and societal attitudes about how women "should" act, the study said. Additionally, the study found that the gender differences were not due to differences "in aspirations, reservation values, or first offers."
Further studies show that women who are assertive or negotiate aggressively experienced a drop in others willing to work with them, Bowles added. The anticipated backlash can cause women to let the opportunity pass.
"The anticipated backlash, the sense that this is a little socially awkward for me, it is not a weakness on the part of women or an inability to negotiate. It's actually socially savvy," Bowles said.
So what can women do to achieve the best results in negotiation?
Panelists agreed that entering negotiations prepared is important. Preparation should include mock interviews along with a script for difficult questions in mind, research on industry standards regarding salary and benefits, and keeping a clear goal in mind.
"People can get kind of anchored by the offers that are in front of them and get all focused on pay and lose sight of actually realizing that something else is more important to them. So be clear in your goals, stay in touch with your goals," Bowles said. "Have an understanding of what you're asking for. Are you asking for something standard or are you asking for something exceptional?"
The framing of negotiations is important to reduce backlash, the panel said.
"We really find that when people use a polite but assertive strategy, we're not finding the typical backlash effect of when people use a more aggressive, self-focused strategy. So I think there is there is a fair amount of data to support that the framing is very important," said Julia Bear, associate professor in the college of business at Stony Brook University.
Keeping in mind the employer's perspective can also enhance the persuasiveness of negotiation attempts, Bowles added.
Talk with your co-workers and network about pay, panelists agreed. Despite being uncomfortable, conversations about pay can highlight discrepancies that would otherwise go unnoticed.
Explanations and reasoning for pay raises and other issues should be consistent, Zlatev said of businesses.
"Whatever policies you make around negotiation to try to sort of close the gap is something that needs to be consistent and needs to be sort of upheld for everyone," he said. "There's definitely benefits that can come out of negotiation, both for you and for the organization, in terms of finding the best fit for you and your role and all of these types of different things."