It’s no secret that the HR industry can be called a bona fide “girls’ club”. According to the US Bureau of Labor Statistics, women held over 80% of all human resources positions in the States as of 2021. But, as in many other industries, women in HR face equity challenges when it comes to compensation. 

Although HR is not immune to the same challenges which affect pay inequity in other industries, the pay gap is narrower here than it is in most other industries. In the face of global inequity, this is no small feat. It’s something to be proud of. HR is a woman-dominated industry which, perhaps unsurprisingly, equitably and actively recognizes the contributions that women make to the workplace. 

That being said, the first step to transformation is to remain attentive to areas in which there is room for improvement. We’re taking a closer look at the current pay gap to understand why it looks the way it does, and what this means for employee engagement and retention. 

First, the good news

As we mentioned earlier, the human resources industry has demonstrated an encouraging positive movement towards closing the pay gap between male and female HR professionals. In 2020, the Bureau of Labor Statistics reported that, nationally, women HR managers were making 91 cents to every dollar earned by men in the same positions. That’s a pay gap that has narrowed by 5 cents since 2011. We’re on the right track. 

For comparison, in other industries, full-time women workers were making 82 cents to every dollar made by a man. That’s a gap of 9 cents. The gap is closing, but progress is slowing - and we don’t really know why. 

The less good news

Unfortunately, the pay gap in most industries has remained relatively stable for the last two decades. According to the Pew Research Center, the current wage gap is not much improved from the earning disparity between men and women in 2002, when women were earning 80 cents for every dollar earned by a man. 

Here’s what’s changed. Nowadays, women generally begin their careers closer to wage parity with men (good), but they consistently lose ground as they progress in their work lives (not good). Why is that? 

Despite being off to a strong start, women are earning less as they go along. Parenthood could play a role.

One of those reasons is not college education which, somewhat ironically, is a bit of good news. Pew Research tells us that American women are more likely than men to have graduated from college. The pay gap between college-educated women and men is not any narrower than the one between women and men who do not have a college degree. This suggests that other factors are responsible for the fact that women’s earning power diminishes over the course of their careers. 

There is no single explanation for why progress towards closing the pay gap is getting slower. But it’s not because of education rates, and it’s certainly not because women are electing to enter into jobs that pay less. Maria Colacurcio, the CEO of Syndio (a pay-equity technology platform) told HR Brew that attributing the pay gap to gender in occupation “isn’t an issue of self-selection into lower-paying jobs. That’s looking at the effect and calling the cause.” 

One factor that may be impacting women’s ability to sustain equitable pay is parenthood. According to Pew, “Mothers aged 25 to 44 are less likely to be in the labor force than women of the same age who do not have children at home, and they tend to work fewer hours each week when employed.” Furthermore, when employed men become fathers, their earning power actually tends to increase. 

On the whole, parenthood spells out an intriguing inverse relationship for fathers in the workplace. The share of employed men with children peaks between 35 and 44 years old. This is also when fathers tend to receive higher pay, even as the pay of employed mothers in the same age group is unaffected. Generally speaking, parenthood leads some women to put their careers on hold (whether by choice or necessity) but has the opposite effect amongst men. 

In a related phenomenon, mothers with children at home tend to be less engaged in the workplace, whereas working fathers are more active at work. Not only are fathers more likely to be employed or to be seeking a job than men without children at home but, among those who are employed, fathers (on average) work more hours every week than childless men.

Recognition is key to retaining and engaging women in the workforce 

The most practical way to assess if and where gender-based pay disparities exist in an organization is to invest in auditing starting salaries, bonuses, and promotions for gender bias. But to retain talented women in the workplace, effective recognition strategies are not so much a nice-to-have as an essential tool for building thriving, long-term relationships between employers and employees. 

That’s a complex ask for HR, especially considering that this is a department which is more than likely manned (excused the pun) largely by women. There’s a way to make it easier for HR professionals and employees alike. Gifted offers a range of intuitive, easy-to-use gifting and recognition strategies which super-boost employee satisfaction and engagement. 

Recognizing women’s accomplishments goes further than closing the pay gap. We’re making it a little easier to go the extra mile. Gifted - simply appreciate.