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“5 Things We Need To Do To Close The Gender Wage Gap”, with Tracey Smith of Numerical Insights

An Interview With Candice Georgiadis

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The overall wage gap of a company or population does not take into account whether men and women are in similar job roles. Only in similar job roles goes comparing salaries make sense since each job role can have a very different market value. Do we expect a brain surgeon to be paid the same as an hourly fast food worker? Of course not. It makes no sense to compare salaries of everyone together. To measure equity, we need to conduct an apples-to-apples comparison within specific job roles. Only then, can you measure fairness across gender.


As part of my series about “the five things we need to do to close the gender wage gap” I had the pleasure of interviewing Tracey Smith. Tracey Smith is regarded as a thought leader and strategic adviser in the field of analytics. She has over 25 years of experience applying mathematics, statistics and data analysis to business problems. Tracey is the President of Numerical Insights LLC, a boutique analytics company serving large and medium-sized companies. She holds degrees in Applied Mathematics, Mechanical Engineering and Business from well-recognized universities in Canada and the U.S. Her career spans the areas of mechanical engineering, supply chain and human resources. Tracey has been recognized as one of the “Top 50 Global Influencers in HR Analytics” and one of the “Top 15 HR Analytics Experts to Follow.” She is also CPSM certified through the Institute for Supply Management. Tracey is the author of several books and hundreds of articles published in industry magazines and online web sites.


Thank you so much for joining us Tracey! Can you tell us the “backstory” that brought you to this career path?

My career began in engineering 25 years ago. My job role was to use data analysis to predict the performance of automotive components. Throughout the years, I expanded the areas where I applied data analysis to business situations which led me into the areas of supply chain inventory analysis and human resources analytics. It was in the area of human resources that I began to extensively study gender-related data inside global companies. At the same time, I began to read scientific gender studies that had been conducted over the past few decades.

Ok let’s jump to the main focus of our interview. Even in 2019, women still earn about 80 cents for every dollar a man makes. Can you explain three of the main factors that are causing the wage gap?

First, it is important to understand the wage gap measurement because it has been incorrectly interpreted as a measure of equality. It does not measure fairness or equity and the creators of this measurement admit his… but you have to go three levels deep on their web site to find this admission.

Inside any company or a population of people, the wage gap is the difference between the median salary of men and the median salary for women. The median is nothing more than the middle salary value if you were to list everyone’s salary from lowest to highest. The value that lands in the middle of this list is the median. This is what is done to determine the median value for male and female salaries. The wage gap is the difference between these two values.

The overall wage gap of a company or population does not take into account whether men and women are in similar job roles. Only in similar job roles goes comparing salaries make sense since each job role can have a very different market value. Do we expect a brain surgeon to be paid the same as an hourly fast food worker? Of course not. It makes no sense to compare salaries of everyone together. To measure equity, we need to conduct an apples-to-apples comparison within specific job roles. Only then, can you measure fairness across gender.

For example, a highly technical job commands a higher salary on the market. Non-technical jobs tend to have a lower salary value in the job market. Unless an equal number of men and women choose these technical professions, and we know this is not the case from examining graduating university classes, there will automatically be a gender gap in technical and scientific companies merely as a result of the choices men and women made regarding their university area of focus. I underline choices to emphasize that it is what men and women choose to do that impacts the gender gap measurement. It isn’t something that companies did. The choices impacting the gender gap happen long before anyone enters the corporate world. Blaming companies for the gender gap is incorrect.

That said, there are a few things companies can to do encourage the choices that men and women make in the work world. I have analyzed human resources data for several global companies to measure the fairness of hiring and promotions across gender. I have never seen a bias against women in the hiring or promotions process. For example, if 50 men and 50 women choose to apply for a management position, we expect that roughly 50% of promotions would go to men and 50% of promotions would go to women. In all of the data I’ve analyzed, this is exactly the case.

What I have seen in corporate data though, is that as women approach the management levels, they are less likely to apply for an internal promotion into management. We do not see 50 men and 50 women applying for the management position I mentioned above. We likely see 30 women and 50 men apply.

The reasons for this are several. Most people assume that entering the management level requires longer work hours and greater amounts of travel. For women with young children, they may choose to delay entering the management levels to keep their time free for family commitments. Additionally, studies have shown that the wording used in job descriptions can impact the proportion of men and women that choose to apply. If the wording uses more aggressive terms like “go-getter,” it can yield more male applicants. If the job description uses less aggressive words and is described as collaborative, it can yield an increased number of female applicants. Based on gender studies, large companies are now adjusting the wording in their job descriptions and explicitly stating when a job role will have minimal travel associated with it.

Can you share with our readers what your work is doing to help close the gender wage gap?

My work is about educating people on how to accurately measure fairness for men and women. I take company data and use statistically analysis to analyze the fairness of hiring and promotions. I also use data to provide insight into whether a company is seeing a reduced number of female applicants for internal promotions and providing suggesting on how that can be improved.

My role outside of corporations is to educate the general population on how badly misrepresented the gender gap measurement is. Women do not “make 80 cents for every dollar a man makes.” Women have predominantly chosen professions that command a lower salary on the job market. To alter the gender gap value, more women need to choose a career path that has a higher market value such as those in the areas of engineering, science, technology and math (STEM). These choices are made when women are very young and this is why we have seen a large number of events, conducted by educational institutions in partnership with corporations, to introduce girls as young as the age of 8 to technology.

Can you recommend 5 things that need to be done on a broader societal level to close the gender wage gap. Please share a story or example for each.

  1. Understand why the gender wage gap measurement isn’t a measure of gender equity.
  2. Encourage women to apply for management roles.
  3. Introduce your daughters to technology.
  4. Ensure young girls participate in activities that boost their confidence.
  5. Educate young people, regardless of gender, on how career choices impact their future financial success.

This was really meaningful! Thank you so much for your time.

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