Asking for a raise can be nerve-wracking: the stakes are high, and you have to brace for potential disappointment if things dont pan out.
But if youre a man, you might have a better chance of hearing a yes to your request.
According to a recent survey by CNBC, while the same percentage of men and women (11%) asked for a raise this year in response to the rising cost of living, men were more likely to get the salary bump. Fifty-nine percent of men received a raise, compared to only 52% of women.
This isnt a great look for employers given the persistent gender wage gapper the Census Bureau, women make an estimated 82 cents on the mans dollar. And its far worse for women of color. Not to mention the number of women working full-time plummeted during the pandemic. Today, women are likelier than men to work part-time, or to not work at all.
For both men and women, reasons they were denied a raise were fairly uniform: 35% told CNBC their bosses didnt provide a reason, 22% said their company didnt have the budget for a salary increase, 15% said they werent eligible, and 8% blamed bad timing.
No one is happy to have their raise denied, and just one-third of U.S. workers think theyre paid fairly to begin with. That may not be surprising, given that CEO pay has skyrocketed by 1,322% since 1978 while the average employee wage grew by just 18%, according to the Economic Policy Institute. In 2020, CEOs were paid 351 times more than a typical employee.
Failing to secure a raise at a critical juncture can cause a ripple effect across all areas of a persons life, from their career to their savings. Forty-four percent of women surveyed told CNBC theyre currently unprepared for retirement; just 33% of men said the same. More immediately, being denied a raise can also push employees to go on the job hunt. A recent survey by Great Place to Work found that 54% of women were planning to look for new jobs this year, in part because they didnt feel like they were paid fairly.
As a result of the gender pay gap, a woman who begins a full-time career today stands to miss out on $417,400 over the course of a 40-year career, according to analysis from the National Womens Law Center.
Transparency could fix the problem
Experts have long maintained that greater salary transparency, on every level, is one of the best solutions for closing wage gaps between workers.
Increasingly, cities and states are passing pay transparency laws: They have already gone into effect in New York City, California, and Colorado, and will begin in Washington State as of Jan. 1, 2023.
A study from the University of Utahs Eccles School of Business tracked the wages and productivity of nearly 100,000 U.S. academics over two decades. They found that pay transparency substantially reduces the gender pay gap as well as other forms of pay inequity [by up to 50%].
In response to transparency shocks, as the researchers call it, companies substantially alter their wage adjustment policies, particularly by granting bigger pay increases to those in historically underpaid groups, especially women of color.
Our new weekly Impact Report newsletter examines how ESG news and trends are shaping the roles and responsibilities of todays executives. Subscribe here.
