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I am a M.A. in industrial/organizational psychology. Most of my experience has been in human resources and change management. My passion lies in employee assessment, organizational development and employee opinions. Website: www.IanMondrow.com LinkedIn Profile: http://linkd.in/drBYoC

Monday, November 15, 2010

Why are women paid less than men, but given higher raises?

Summary by: Ian B. Mondrow, M.A. 

Gender differences in pay has been an ongoing issue for decades. Its saddening to think that these differences still exists but an abundance of previous research supports the notion. Regardless of industry, occupation or other variables, women only receive a wage 88% that of men (Blau et al., 1998).  Previous research offers a variety of reasons for this and they include: part-time vs. full-time, employment sector, industry and more. There are also arguments that woman receive reduced starting wage. Some researchers believe that women are less aggressive when it comes to negotiating salary but this is a controversial topic in itself.

Although it does not compensate for a slashed wages, past studies have found that women receive higher pay increases. Redyced stereotyping may be the result of these increases. Reduced stereotyping occurs when a manager does not have a sufficient amount of information to evaluate the individual and therefore base his/her decisions on stereotypes. When enough information is present, reduced stereotype is less likely to occur. Structural features may also be a factor in this gender difference. Many organization base pay increases on a performance rating and their level in their job grade. In this structure, employees that are paid less are eligible for higher pay increases than employees with higher salaries. Therefore, if women start off with lower salaries, they will be more likely to have higher pay increases.

Harris, Gilbreath and Sunday (2002) decided to put these theories to test. Using previous data from a government-owned, contractor-operated nuclear waste facility in the united states. 218 participants were randomly selected to participate; 174 were men and 44 were women.

In their analysis, it was found that seniority, education and performance ratings did not differ between men & women. However, compared to men, women had significantly lower salaries (on average about $1000 less per month) and were in lower grades. When including job grade, education level and seniority as variables in their analysis, it was found that salary differences decreased but did not put an end to the salary differences between genders. On an annual basis, women earned a range of between $1080 (in 1991) and $2004 (in 1993) less than men.

It was found that women received pay increases that were, on average, 5% greater than men. These differences diminished once job grade and base pay were added as variables. Furthermore, performance ratings did not impact the differences between gender.

There are several limitations that must be considered in this study:

  • First and foremost, this study is about 8 years old. 
  • The organization was new and employed individuals for only 4 years. 
  • The organization work with government contracts and therefore may have strict anti-discrimination laws to abide by. 
  • The time frame that was examined was only two years.


This picture does not reflect my personal opinion.
It is clearly a controversial image, but I like the
message at the bottom.
How can HR professionals avoid pay differences as a result of gender? This is a tough question and an issue that thousands have been fighting against for decades. First and foremost, ensure that both men and women are offered the initial starting wage. At that point, it is their responsibility to negotiate salary within the range. 

To avoid gender differences in pay increases, pay increases should be based on tenure or performance reviews. Having a structured pay increase guide that correlates with performance appraisal goals can assist in dismantling this difference. In addition, ensuring that managers are provided with sufficient information on their employees will ensure that they do not experience reduced discrimination. Most importantly, always base performance appraisals on a job analysis. For a performance appraisal to be effective, it must be based on the criteria that one needs to be successful in this job.

I am hoping that these pay increases and base salary differences diminish in time.

Source: Harris, M.M., Gilbreath, B., Sunday, J.A. (2002). Why are women paid less than men, but given higher raises. Journal of Business and Psychology, 16(4), 499-514.


  1. About offering the same initial wage and giving women the responsibility to negotiate. I cannot remember the source, but I've read that women are less likely to negotiate salary than men. Can you say more about this? Thanks

  2. Thats a great question. Unfortunately, that article is on my office computer and I am out of town until tomorrow. On Friday, I will be sure to pull up the article and obtain that reference.

    Like I have said, it is a controversial debate. There is research that suggest that men are more aggressive when it comes to negotiating salary. The research does not apply to all women but it does suggest that it more common for women to be less persistent in negotiation of salary. Much of this has to do with the gender expectations between men and women. According to gender-roles in the U.S., it may be perceived unacceptable for a woman to be aggressive. Through our upbringing, women may have been chastised for aggressiveness and therefore it carried over into business skills.

    I want to reiterate that this is not my opinion. I have met many women who are aggressive and men that are passive. Therefore, I am hoping that gender expectations have changed.

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