A recent analysis by the American Association of University Women found that a sizable majority of all student debt in the US is owed by women—$890 billion out of $1.4 trillion—while individual women with bachelor’s degrees graduate with an average debt $2,700 greater than that of their male classmates:
The newly-released data from the 2015-16 National Postsecondary Student Aid Study also reveal that:
- Women comprise 56 percent of enrolled college students, but hold 65 percent of outstanding student loan debt;
- 71 percent of women have student loan debt at bachelor’s graduation compared to 66 percent of men; and
- Black women graduate with the most debt – at $30,400 – compared to $22,000 for white women and $19,500 for white men. …
The analysis shows how the burdens become compounded by other financial factors – where women take two years longer than men to repay their student loans, in part because of the gender pay gap. Women with college degrees who work full time make, on average, 26 percent less than their male peers, which leaves women with less income to devote to debt repayment. Compared to white men with bachelor’s degrees, black and Hispanic women with bachelor’s degrees make 37 percent and 34 percent less (respectively) and struggle to repay their loans as a result.
The Millennial generation is already known to be struggling with an unprecedented burden of student debt, driven by the rising cost of college, the financial impact of the Great Recession, and other factors. The AAUW analysis adds a new dimension to this problem by illustrating how acutely it affects women (particularly women of color), in combination with the other factors that contribute to their disproportionate levels of financial insecurity.
A new survey released last week by Willis Towers Watson illustrates the key factors driving US companies to reassess and change their compensation practices. In explaining why they were making these changes, employers cited cost, manager feedback, changes in the marketplace, and employee feedback as the most common motivations. WTW’s Getting Compensation Right Survey, conducted in April 2018, surveyed 1,949 employers worldwide, including 374 US employers whose total workforce comprises more than 5.2 million employees.
Among the US employers, nearly half said they were considering or planning on redesigning their annual incentive plans, while more than a third said they were changing criteria for salary increases. This highlights a trend we’ve been seeing over the past few years, in which employers are rethinking the traditional annual raise and opting for more targeted and differentiated increases or bonuses to reward and incentivize performance. Many employers also told WTW that they were refocusing performance management to include future potential and possession of skills needed to drive the business in the future, as well as introducing recognition programs to provide on-the-spot rewards.
One move many companies are making is toward greater pay transparency, with 53 percent of respondents saying they were planning on or considering increasing the level of transparency around pay decisions. Our latest research at CEB, now Gartner, also finds that transparency is a growing concern among rewards functions. One driver of this trend is the increasing amount of information available to employees and candidates about what other people are earning in their roles, both within their organization and at other organizations, through external sources like Glassdoor or LinkedIn.
In our employee survey, we found that 42 percent of employees who had consulted one of these online sources for pay information had thought about leaving their current employer as a result. These external forms of transparency are making it increasingly important for employers to be more forthcoming about their pay practices and take control of the narrative around compensation at their organization to get ahead of employees who might find (potentially inaccurate) information elsewhere and draw their own conclusions.
A recent study by the Boston Consulting Group and MassChallenge, a global network of startup accelerators, takes a close look at how startups founded by woman compare to those founded by men, both in terms of how much venture capital financing they receive and how well those investments pay off. Looking at five years of investment and revenue data from the startups MassChallenge has worked with, the study found that those founded by women consistently attracted less investment, even though they actually tend to generate more revenue:
Investments in companies founded or cofounded by women averaged $935,000, which is less than half the average $2.1 million invested in companies founded by male entrepreneurs. Despite this disparity, startups founded and cofounded by women actually performed better over time, generating 10% more in cumulative revenue over a five-year period: $730,000 compared with $662,000. In terms of how effectively companies turn a dollar of investment into a dollar of revenue, startups founded and cofounded by women are significantly better financial investments. For every dollar of funding, these startups generated 78 cents, while male-founded startups generated less than half that—just 31 cents.
The findings are statistically significant, and we ruled out factors that could have affected investment amounts, such as education levels of the entrepreneurs and the quality of their pitches. … The results, although disappointing, are not surprising. According to PitchBook Data, since the beginning of 2016, companies with women founders have received only 4.4% of venture capital (VC) deals, and those companies have garnered only about 2% of all capital invested.
This gender bias may be costly to venture capitalists as well as entrepreneurs: The study calculated that VCs could have made $85 million more over five years had they invested equally in the startups founded by women and by men.
The researchers went one step further and spoke to founders, mentors, and investors to understand the origins of the gender gap in VC funding. Consistent with various other research showing that women are more likely to be challenged, questioned, and criticized in the workplace than men, they found that women founders and their presentations receive more pushback from investors than their male peers. Men are also more likely to talk back to investors when their claims are scrutinized, and to make bold, blue-sky projections in their pitches:
German Chancellor Angela Merkel is arguably the world’s foremost example of women’s empowerment: an accomplished scientist turned national leader and one of the most powerful people (not just women) in the world. Notwithstanding Merkel’s achievements and those of other women leaders in German politics, the country lags behind its European peers in closing the gender pay gap. Germany’s pay gap stands at 21.5 percent, according to EU data: the third largest in Europe and well above the EU average of 16.2 percent.
A new law that went into effect in January is meant to help close that gap by allowing employees to request information about wage disparities from their employers, but as Carolynn Look and Elisabeth Behrmann pointed out in a recent Bloomberg feature, the law puts the onus on employees to ask, whereas other legislative efforts, like the UK’s mandatory pay gap reporting and similar laws being considered in France, compel employers to provide this information up front.
A major component of the challenge for Germany is cultural: The term Frauenberuf (women’s job) is still used to describe occupations like nursing, housekeeping, child care, and social work—jobs that are often low-paying, part-time, and lack clear pathways to career advancement, Look and Behrmann note:
Even in fields dominated by women, such as medical assistants, men can get paid 40 percent more. The lower pay, along with more part-time work for women, mean they earn about 50 percent less over their working lives than male peers, according to a 2017 study by the German Institute for Economic Research in Berlin.
Sexual harassment is an endemic problem in the US academic science community and a major barrier to progress toward including more women in the field, a new report from the National Academies of Sciences, Engineering and Medicine concludes. While physical abuse and unwanted sexual advances are common, the most pervasive form of misconduct is what the report terms “gender harassment,” referring to hostile work environments in which women are routinely subject to sexist comments and crude behavior from their male colleagues, sending the message that they are not welcome there, as contributors to the report tell the Associated Press:
“Even when the sexual harassment entails nothing but sexist insult without any unwanted sexual pursuit, it takes a toll,” said University of Michigan psychology professor Lilia Cortina, a member of the committee that spent two years studying the problem. “It’s about pushing women out.”
The report complies data from multiple large surveys to get a sense of how pervasive sexual harassment and gender discrimination are in the academy. One survey from the University of Texas found that 20 percent of female science students, more than 25 percent of engineering students, and over 40 percent of medical students reported being sexually harassed by faculty or staff. Another survey from the Pennsylvania State University system found that half of all female medical students had been harassed. Women working in university science departments experience harassment as well as students: 58 percent of academic employees report having been sexually harassed at work.
Sexual harassment “has long been an open secret” in the sciences, MIT professor and report co-chair Sheila Widnall told the AP on Tuesday. In its coverage of the report, the New York Times highlights the panel’s recommendation that universities and research institutions start focusing on prevention and fixing the work environment, rather than just “symbolic compliance with current law and avoiding liability”:
Peter James Sampson/iStock
The accounting firm PwC has adopted a new rule in the UK whereby shortlists of candidates for senior roles must include at least one woman, the Daily Mail reported on Sunday:
Laura Hinton, chief people officer at PwC, said: ‘Diversity in our recruitment processes is something we’ve been focused on for some time and as part of this we are ensuring we have no all-male shortlists and more diverse interviewing panels.’
PwC, which specialises in tax and advisory services, recently set a target to recruit 50 per cent women and 50 per cent men in all of their recruitment drives. The firm also has a sizeable 35.9 per cent pay gap for its Black Asian and Minority Ethnic (BAME) employees. The move comes as it emerged that the three other companies which make up the Big Four – Deloitte, KPMG and EY – had all called for greater diversity on their candidate lists.
PwC and its competitors all released their UK gender pay gap data in March in line with a law requiring most organizations in that country to do so. These firms’ partnership structures starkly illustrated the degree to which the underrepresentation of women in leadership roles compounds the gender pay gap.: PwC reported a mean gender pay gap of 43.8 percent and a median gap of 18.7 percent when partners were included, whereas the mean gap for employees of PwC Services Ltd., the legal entity that employs most of the company’s UK workforce, was just 12 percent.
Overall, the 61.4 of the roles in the top quartile of the firm are occupied by men, the report showed. Absent the underrepresentation of women in senior roles, PwC said its overall UK pay gap would be as low as 2.9 percent—a difference that “can largely be explained by time in role and skill set factors.”
Connecticut Governor Daniel Malloy signed a bipartisan bill into law on Tuesday that will restrict employers in the state from asking candidates for their salary histories, the CT Post reported:
Called the pay equity bill, the new law prevents employers from asking job candidates about their salary history before extending them an offer. Supporters say that question often results in lower starting pay for women and people of color. In 2016, Connecticut women made 79 cents on the dollar compared to men, according to the National Women’s Law Center. Over a lifetime, women made $529,160 less than their male counterparts, on average.
Connecticut’s new law leaves some questions unanswered for employers, Proskauer attorneys Allan Bloom and Laura Fant note in a more detailed overview of the ramifications for employers. The law permits employers to ask about “other elements of a prospective employee’s compensation structure” than wages, but not the value of those elements. The law does not define the scope of these other elements, however, so Connecticut businesses may seek clarification on this question from the state’s labor department.
With the signing of this law, which goes into effect January 1, Connecticut will becomes the sixth US state to ban salary history inquiries: Massachusetts was the first to do so in 2016 (though the effective date of that law has been delayed until July 1 of this year), followed by California, Delaware, Oregon, and most recently Vermont. New York Governor Andrew Cuomo has also put forward a bill that would ban these inquiries. New Jersey’s recently-enacted equal pay law does not prohibit them, but makes it easier for employees to demonstrate pay discrimination in a lawsuit.