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SALT LAKE CITY — Utah often lags behind the country in equal pay, as noted by the Utah Women and Leadership Project in its report on gender wage gap released in November 2021. These wage gaps disproportionately affect single mothers and women of color.
"It's really astonishing in the year 2022, that we can still look our employees in the face — who we rely on — whether you're a small business or a large corporation, that you can look your employees in the eye and still not pay them fairly," Salt Lake City Mayor Erin Mendenhall said in front of the Salt Lake City and County Building Thursday.
Statistics like those in the gender wage gap report are why city officials went to their books and audited what they are paying employees who don't have set salaries, which resulted in a realization that nearly all non-union Salt Lake City employees had salaries that aligned with experience and not gender or race.
The city's report was actually released a little over a year ago but sort of fell through the cracks in the sense of acknowledging the findings. Mendenhall said she brought it up Thursday because of its importance during Women's History Month.
Pay inequities can have serious economic consequences, said Silvia Castro, executive director at the Suazo Business Center. She points to a 2021 report from the Federal Reserve Bank of San Francisco, which found that racial and ethnic inequities cost the U.S. economy nearly $23 trillion over the past 30 years based on earnings, education, hours worked and more.
"Pay equity is not a zero-sum game," she said. "We all benefit when there is pay equity. When we look at GDP as a metric for prosperity, we want to make sure we're not leaving any people behind."
The point of the Salt Lake City audit was to figure out if that was the case in the city and to see what could be done to fix it.
The city government worked with the global consulting firm Payfactors to conduct its audit, beginning in fall 2020. The review excluded part-time or seasonal workers, elected officials, or any job where there is no pay variability, especially union employees who work through a collective bargaining agreement. Their pay is set on written standards and not any other factor, such as race or gender.
The salaries of about 1,000 full-time, non-union city employees were ultimately analyzed and split into two groups: airport employees and non-airport employees, such as surveyors or support staff. The rationale for the split is that airport jobs are "much more competitively compensated" than similar jobs in other city departments, the report states.
Auditors then conducted a "simple comparison of average pay," followed by a regression analysis of employee salaries to figure out what may have resulted in any pay discrepancies. In the final step, Payfactors conducted something called an employee cohort analysis, where they reviewed any remaining outliers for possible inequities.
What they found is that, yes, non-union men still make more than women by $3.21 per hour on average. White employees also make $4.26 per hour on average more than non-white employees. However, David Salazar, the compensation program manager for Salt Lake City's human resources department, says those gaps ended up being due to differences in age, training and/or experience, rather than gender or race.
For instance, the report notes employees over 40 averaged $6.88 per hour more than employees younger than 40.
The audit only found three cases where the numbers didn't line up, and each was found to be "justifiable" upon the final review. Mendenhall said all three cases were "remedied" during the 2021 budget period.
The mayor said Thursday that the city plans to conduct similar reviews on a fairly regular basis, and hopes the audit can be used as a template for others in addressing wage gaps.
"(The three discrepancies) probably would have not been caught if we didn't have a general audit," she said. "Please take the time, whether you're a small business or a large corporation, a nonprofit, or whatever entity you are, review this evaluation because the income and the stability of our families in this community are depending upon it."
