Some might consider the fight for gender equality mostly done and dusted. But following the money tells a different story. When it comes to paychecks, history keeps repeating itself.
In the United States, women still earned only 82 cents for every dollar earned by men in 2022 – hardly budging from 80 cents in 2002. What’s more, the gender wage gap widened slightly in 2023 and again in 2024.
And the problem is global. No economy in the world has closed the gender wage gap—not even Iceland, where earnings are the most equitable in the world.
New research by Christian Moser, the Sidney Taurel Associate Professor of Business at Columbia Business School, coauthored with Professor Iacopo Morchio at the University of Bristol, brings forth a surprising new take on this problem. By examining data from Brazil, they found that employer-provided amenities explain a large part of the wage gap, with women more likely than men to choose jobs for their non-financial benefits. Their research was supported by CBS's Reuben Mark Initiative for Organizational Character and Leadership.
In the following conversation, lightly edited for clarity and length, Moser talks about the profound implications his research holds for managers and policymakers alike.
CBS: How did your understanding of the gender pay gap change while doing this research?
Moser: I was always aware of the gender pay gap and some of its contributing factors. Still, I was shocked by the staggering wage differences we found. As an economist, I expected to explain these differences through established theory. The usual explanations are: occupation, education, work experience. But we found that most of the gap could not be explained by those factors alone. That’s where things got interesting.
CBS: If the usual suspects don’t fully explain the gender pay gap, what does?
Moser: What we found instead is that men and women with the same qualifications work for different employers, and that has a huge impact. For example, female nurses will choose to work at a large public hospital, while male nurses tend toward a private clinic.
This finding was something of an “a-ha” moment for us. For one thing, the specific employer category is not even recorded by most labor market surveys. This piece of the puzzle has largely been missing from our understanding.
To put it simply, the largest chunk of gender pay differences in Brazil can be attributed to the fact that men work for companies where everyone gets paid a lot. But women are much less likely to work at these places.
CBS: Why are men more likely to work at high-paying employers?
Moser: We learned a lot about the differences in men’s and women’s career trajectories. On the average career path, men tend to switch jobs for better pay. But for women, pay doesn’t climb as much over their careers. Instead, they seek out jobs that offer benefits other than money. A better job for them might offer longer parental leave, flexible hours, lower injury risk, and so on.
These kinds of jobs typically don’t offer steep increases in earnings. Nobel Prize-winning economist Claudia Goldin has noted that women bear the brunt of family obligations, and as a result they shy away from job opportunities that men might grab. Our findings show that those are exactly the types of jobs that offer more money.
CBS: How should employers navigate these differences? How can we move toward a more equitable labor market for men and women?
Moser: Hiring managers should understand that the typical career path looks very different for men and women, and competing for the best talent on salary alone is not enough. A compensation package that offers generous amenities beyond salary is going to be more attractive to a larger number of candidates regardless of gender.
Of course, we’re not suggesting that women inherently prefer to earn less, or that all they want is flexibility. But we’re interpreting our findings considering the real constraints women continue to face in our society. Whether through child-rearing or elder care, women tend to be the ones placed in charge of a dependent. That leads them to often trade a higher salary for other amenities. Managers should understand these nuances if they want a truly equitable workplace.
CBS: Your study uses data from Brazil. How might these findings be interpreted elsewhere?
Moser: In richer countries, we expect that job seekers will place an even greater premium on non-wage amenities. Money is the number-one motivator for someone who is just trying to get by. But with greater income comes the chance for people to prioritize what matters to them through greater flexibility and other amenities.
This has broad implications for public policy, too. Countries like Norway have launched programs to reduce their gender wage gap, but policies focused on wages are missing half of the picture. Non-wage amenities must also be incorporated into a comprehensive approach to one of the labor market’s stickiest problems.
