Mind the Gap: Negotiating Your Way Through 2019
This January, as we turned the proverbial pages on our calendar, we started the year off with bold commitments and a laundry list of resolutions, vowing to do better, be better, act differently. And yet, we all know how hard it is to create lasting change on an individual level, let alone on a corporate or societal level. Many people are struggling today with what we know we should be doing and what we are actually doing -- that inexorable chasm between knowledge and action. This applies to a lot of areas -- from relationships to spending, eating habits and working out, to parenting. One area we are focused on at WIN Summit, is the gender gap.
On the positive side, 2018 was undoubtedly the year of the woman, with the inauguration of Time’s Up on the first of January, our country, more than ever jump-started the year with an awakening towards the realities of gender inequality and its malaise. The old boarded up windows were finally opened and the layers of dust, cobwebs, and other detritus visible for all to see. Voices that were previously silenced were now being heard.
But despite having taken major strides towards gender equality in the 20th century, the facts suggest that we have a long way to go. According to the Institute for Women’s Policy Research, pay equality may be worse than we thought. Their recent study found that women, who were previously reported as being paid close to 80 cents on the dollar as compared to men, are actually, according to their study, being paid just 49 cents on the dollar. And according to a 2018 Payscale report on The Gender Pay Gap, in the cases where women do start at the same pay rate as men, as they move up the ladder, they fall behind. Another study from the Institute for Family Studies has evidenced that despite 32% of newlywed women being more educated than their male spouses, 73% of male spouses continue to earn more.
Why is this, we demand to know. Why are companies, even well-intentioned companies who are making strides towards gender parity, still struggling to create meaningful change? As a woman who wants to reach gender parity in her lifetime, and if not in her lifetime, then certainly in her daughters’ lifetimes, this was disheartening, to say the least. Let’s then take a look at Linda Babcock’s study in Women Don't Ask in which she discovered that only 7% of women attempted to negotiate salary compared to 57% of men. Additionally, by failing to negotiate a starting salary in a first job, a woman may sacrifice over half a million dollars in earnings by the end of her career!
Through these cold steely statistics, I started to see the truth that I had previously only engaged with anecdotally. Women as a group feel uncomfortable around negotiation.
Beyond the statistics, nearly every woman I asked would validate that feeling or that belief -- that she did not like to negotiate, and felt she was not very good at it. But to counter this belief we need to get comfortable with some other truths.
Truth number one: We deserve to be paid well.
The problem often starts when we get the job. Forgetting that we are the asset to our employers, and not vice versa, we undersell ourselves and under-negotiate. We are more likely to accept an initial offer without trying to negotiate because we don’t fully understand our worth.
Parade reported in June 2014 that in her last job before becoming First Lady, Michelle Obama told her boss: “This is what I have: two small kids. My husband is running for the U.S. Senate. I will not work part-time. I need flexibility. I need a good salary. I need to be able to afford babysitting. And if you can do all that, and you’re willing to be flexible with me because I will get the job done, I can work hard on a flexible schedule.” “I was very clear”, she said, “and he said yes to everything. That’s how I advise young women: Negotiate hard and know your worth.” We couldn’t agree more.
Truth number two: Everything is Negotiable.
Yes, you read it right. Everything is negotiable. From a pay raise to getting your desired seat on an airplane. You just have to ask. It’s that simple. Women often hesitate to ask and accept whatever is offered to them. Gavin Kennedy, says it well in his popular book, Everything is Negotiable, “If you accept their first offer, you will never see their best offer.” As he explains -- salary, terms, and conditions of employment are fixed only by the final contract. Until the final contract is agreed, everything is negotiable.
Truth number three: Your Current Salary is often the Benchmark for Your Future Salary.
With the exception of NYC, California, Massachusetts, Philadelphia and a handful of other states where the question of previous pay is now illegal, in most places your pay raise will be based on your current salary. Even a little increase in numbers will mean greater yearly raises and conceivably greater rewards in future. Your next employer will ask: What was your last salary? By not asking for the raise or negotiating your salary, you set a lower benchmark for your future salaries. Importantly, as Linda Babcock details, women who consistently negotiate salary increases earn at least $1 million more cumulatively over the course of their careers than women who don't.
Negotiation, or rather, the lack of negotiation, is not the only reason women have traditionally been underpaid as compared to men, though it is certainly one piece of the picture. However, unlike other pieces, this one is in our control. By choosing to negotiate, we will not only get closer to the pay we deserve -- but also set a benchmark for other women.
So this January, as you look through your potentially overwhelming list of resolutions, consider moving negotiation up to the top of them.