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In a World Without Bias, Will Pay Equity Exist?

Assuming Equality Exists Prevents Achieving It

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Pretend tomorrow, you wake up and all bias, both conscious and unconscious, no longer exists. Everyone is treated with the same level of civility in every aspect of life. Possibilities are no longer limited except by our own thoughts and actions. It’s the ideal many people work very hard to achieve. Unfortunately, in the work world, this amazing achievement would not show up in the wallets of men and women who are underpaid based on gender or race or other biases right away. The end of bias would not close pay gaps until the last person employed today, the day before bias-free hiring exists, retires. It will take about 45 years from the end of bias to close pay gaps should nothing else change.

The reason is that many aspects of the hiring, compensation, and promotion processes assume there currently is equality. That assumption, though laudable, actually perpetuates and compounds pay gaps that will continue until no person currently employed ever experienced a bias. One example of the process assuming equality is the use of salary history. Ten additional states and nine local jurisdictions have put restrictions or bans on its use since Massachusetts passed the first law restricting its use. Another example is the data used to determine wages is skewed low by including all the typically underpaid people.

The focus for this article is the everyday question of desired pay. That question alone prevents closing the gender pay gap and all other pay gaps, even in a bias-free world. The trend over the last 15 years, according to Flexjobs, an online job site, is for fewer jobs to include information on salary and benefits in job advertisements. This means the question is asked more and more often. On the surface, it seems like that question gives employers the same advantage over all candidates regardless if man or woman. Dig a little deeper and it does not.

In negotiation there is a principle of anchoring. If I tell you something is worth $5 and you want to negotiate a lower sale price, then you may counter with $3 and we may come to agreement at $4. But if I say the same item is worth $50, then I just anchored the negotiation at a much higher price point. Few people, if any, would counter with the same $3. The item itself hasn’t changed. The sales pitch hasn’t changed. The only change is the dollar value I put on it. That is anchoring.

The same happens for people and their income. Statistically men earn more than women but even within the group of men, different races and ethnicities typically earn differently. White men’s income is considered the setting point. The bias neutral income. Asian men earn 12% more than white men while black men earn 32% less. White women earn 23% less than white men while Hispanic women earn 46% less. Now even after doing research on what a job should pay, it will be hard for others to answer the question of desired pay the same as a white man because of anchoring.

Consider a white man applying for a new job at an employer other than his current one. The man is earning $100,000 (because it makes math easier) and he is asked on the job application what pay he would like to earn. There is a good chance his response will be approximately $120,000 in hopes of earning $110,000 to $115,000. Now, for every other person applying to the same job who is not a white man, answering the same $120,000 has varying levels of difficulty. The Asian man will probably say higher because $120,000 is just a 7% increase of his current pay. The white woman will need to increase her pay by 55%, the black man 76% and the Hispanic woman 122%. How would you feel increasing your current pay by those amounts? Even when knowing you should answer that high, you may never do it thanks to anchoring.

Research confirms that women answer markedly lower than men to the question of desired pay. In Women Don’t Ask by Linda Babcock and Sara Laschever, the research showed women responded 30% lower. The recommendations from such research tends to be women need to learn how to negotiate and be more aggressive. Considering the impact of anchoring, I’m impressed that it is only 30% lower than men. My recommendation is that we acknowledge the question itself is biased and stop asking it. Until then, we have little if any chance of closing the gender pay gap, the racial pay gap, and every other bias pay gap.

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