Submitted by Tricia Brauer
On January 9th, Wells Fargo Bank economist Sarah House kicked off the 2018 year with a discussion on the gender pay gap in commercial real estate. Entitled “The Girl with the Draggin’ W-2,” House’s talk expanded on the widely cited statistic that a woman make eighty (80) cents for every dollar that a man makes by honing in on the multi-faceted nature of the pay gap between men and women. Research cited by House, including the best practices for gender equity and inclusion in commercial real estate study completed last year by the CREW Network, highlighted Experience, Occupation, Industry and Education as critical factors in explaining and addressing the gender pay gap.
In relation to the “Experience” factor, House discussed the “Mommy Penalty” as one of the key components that illustrate why women are still earning less than men. Specifically, the fact that however brief, greater time spent by women out of the labor force and fewer hours worked slows their accumulation of skills and that childcare considerations and associated costs clearly take a toll on workforce participation rates of mothers with young children. Married mothers employed full time still spend roughly an hour more per day on housework and family care related to married fathers. From an “Occupation” standpoint, House highlighted differences in industry and occupation as the largest cause of variation in pay, and stated that such differences explain roughly fifty percent (50%) of the gender wage gap. For example, men are 5x more likely to be engineers while women are 9x more likely to be receptionists and women are overrepresented in education and health services and are underrepresented in construction and manufacturing. No matter what the disparity is in occupation and industry representation, men are still earning more than women in nearly every occupation, including traditionally female jobs. There is at least some solace to be had in the grim statistics brought to the forefront by House’s presentation. Women are now out-achieving men on the “Education” front,. House made it a point to emphasize that the pay gap would be roughly six percent (6%) larger if the converse was true. Despite the critical progress made in deconstructing the gender pay gap, thirty-eight percent (38%) still remains unexplained.
“It isn’t just women that stand to benefit from pay equity,” House stated. From stronger company performance and corporate oversight, boosted sales and profits, and a reduction in employee turnover and associated costs, company performance also stands to benefit from women being on more equal footing with men. Accordingly, both businesses and governments can alter existing policies to further narrow the gender pay gap. Some of these policy solutions include training and awareness, transparency about pay, parental leave – especially paternity leave, childcare tax credits/assistance, difference in tax treatment of a secondary income earner, minimum wage increases and longer school days.
A full copy of House’s presentation is available here.