NEW YORK — The pay gap between male and female employees persists across industries, and now may even be growing, but does the gap begin before an employee is even officially hired? In a groundbreaking study from Columbia Business School, researchers used initial offer data to determine if the gap begins before an employee is hired. Previous studies have primarily focused on the gender disparities present in actual salaries. This research indicates that the inequities begin much earlier in the hiring process, with stark differences in the initial offers made to male and female candidates.
In “Setting Up the Gap? Gender Differences in Initial Salary Offers in Hiring” Columbia Business School Professor Adina Sterling and Postdoctoral Fellow Shiya Wang analyzed over 700,000 initial salary offers made to job candidates between 2017 and 2020. An analysis of the data showed that women receive initial job offers with salaries less than 5.5% lower than those offered to men. This is regardless of adjustments made for job-related variables such as the employer, occupation, industry, geographical location, and human capital attributes.
"This research is crucial as it does more than just showcase disparities at the salary level - it highlights the inherent inequalities women face across industries before they’ve even collected a paycheck," stated Professor Sterling, the Katherine W. Phillips Associate Professor of Business at Columbia Business School.
Additional findings:
- The disparity widens in "masculine-typed" occupations: In roles that are traditionally or stereotypically male-dominated, such as finance, as opposed to those considered "feminine-typed" occupations, such as caregiver roles or teachers, gaps in initial offers are wider.
- The gender pay gap doesn’t appear to come down to negotiating skills: A core feature of the study is that salaries are from a job platform that individuals go on to, so that they can find out how good their salary offers are prior to negotiating. Controlling for job-title, industry, occupation, and other factors, the authors find that an offer gap exists very early in the hiring process.
“What this research demonstrates is that the gender pay gap is not the result of some deficiency on the part of female employees to negotiate for higher salaries, but a result of bias that begins before the employee has even begun to work,” said Professor Sterling. Further research on the subject may include expanding the scope, including initial offer data from outside the United States and further exploring the decision-making process behind initial offers.
