HerMoney Podcast Episode 188: How To Close The Gender Pay Gap Once And For All

Saving money on hermoney podcast episode 188 does not have to be complicated. We rounded up the essentials so you can spend less and skip the guesswork.

Key Takeaways

• Tune in for a how-to on closing the gender pay gap for good , for women (and the men who love them!) What are you doing in the year 2119?
• That’s the year the American Association of University Women predicts that the gender pay gap will finally close, unless we take steps to br...
• On average, white women earn 79 cents on the dollar compared to white men, black women make 63 cents, and Latina women make just 54 cents.

Tune in for a how-to on closing the gender pay gap for good , for women (and the men who love them!)

What are you doing in the year 2119? That’s the year the American Association of University Women predicts that the gender pay gap will finally close, unless we take steps to bridge the gap sooner.

On average, white women earn 79 cents on the dollar compared to white men, black women make 63 cents, and Latina women make just 54 cents. Latina Equal Pay Day was recently observed on Nov. 20 to bring awareness to how this gap adds up: Latina women may lose up to $1 million over the course of their working lives, or around $26,000 annually due to the gap.

This week’s guest, Katica Roy, is here to tell us all how we can work together to speed change and get the gap closed sooner than projected. Katica is a gender economist and CEO of software company Pipeline that lets you employers manage everything from the hiring process to employee reviews. As a gender economist, Katica looks at the economy through the lens of gender to see where it’s working and where it isn’t, and today she shares how we can level the playing field for ourselves and our fellow women.

Listen in as Katica shares some fascinating (and infuriating) facts about how frequently women are underpaid, and what corporations can do to help speed change. Katica details research from her company that spanned 4,000 companies and 29 countries, showing that for every 10% increase in gender equity, there is a 1% to 2% increase in revenue to a company’s bottom line. She also talks about the sea change she’s leading to shift the conversation and get more people thinking about gender equity as an economic opportunity rather than a social issue.

Katica shares her tips for getting paid more (along with a personal story!) as well as tips on how to negotiate, and details on how the gender wage gap impacts women of color and non-binary womxn. She and Jean also discuss how women are being adversely impacted by the pink tax. “When we talk about the gender pay gap, we talk about money coming into women’s wallets, but the pink tax means more money is coming out of our wallets when we pay for everyday items,” she says, explaining how women pay an average of 7% more than men for things like razors and shampoo.

Lastly, in Mailbag, Jean tackles questions about dating and debt, what to do with old retirement accounts, and how to manage asset allocation if you’re part of the FIRE movement. In Thrive, Jean dives into the expense of campus visits and what to do with your teen to ensure you aren’t spending too much on college before you’ve even paid your first tuition bill.

Transcript

Jean Chatzky: (00:06) HerMoney is sponsored by Fidelity Investments. We want you to feel confident about investing so that you can make your money work just as hard as you do. Learn the ropes without the jargon at fidelity.com/demandmore. HerMoney comes to you through PRX. Hey everybody, it’s Jean Chatzky. Welcome to HerMoney. I want to start this show by asking you a few any questions that may actually make you a little uncomfortable, but stick with me. Alright. Question number one, are you happy with how much you’re earning? Number two, how much do you think you’re worth? Number three, are you confident advocating for yourself at work? Okay, maybe you already guessed it, but there are no good or correct answers to these questions. There’s really only one thing that we can all do to bridge the gap, and that’s exactly what we do in every episode of this podcast. We talk about it. The more transparent we can all be about these issues, the more we share with our colleagues, our family, our friends, the better off we’re all going to be. And so I’m thrilled today to be able to shed a little light on this topic with Katica Roy. Katica is a gender economist. She’s the CEO of Pipeline, which is a software company that lets you employers manage everything from the hiring process to performance reviews. And she’s in the studio with me from her home in Denver. Katica, thanks so much for coming on the show.

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Katica Roy: (01:50) Thank you for having me.

Jean Chatzky: (01:52) I have to start with what’s a gender economist?

Katica Roy: (01:56) A gender economist is someone who looks at the economy through the lens of gender. So for instance, the jobs report will be coming out this Friday, we would look at the jobs report through the lens of gender. So how numerous women are participating in the labor force? We know that number has increased year over year. We know that right now there are more women with higher education in the labor force. So really looking at it through the lens of gender and understanding how the economy is working or not working for everyone.

Jean Chatzky: (02:25) For everyone, but with an emphasis on women?

Jean Chatzky: (02:29) And men.

Katica Roy: (02:30) And men. Oh, okay.

Katica Roy: (02:31) And when you look at the economy through the lens of gender, then you can really understand one, is it working for everyone, but also take a data driven approach to gender equity and fundamentally it’s about equity for all.

Jean Chatzky: (02:43) Gotcha. How did you decide to become a gender economist?

Katica Roy: (02:47) It was probably a long road. My undergraduate degree is in political science with a legal studies emphasis. So first was introduced to economics, obviously through my political science degree and always very data-driven. And I think most of my career was in sales. And so really was very forward facing in terms of investments in the business and returns and really flipping that equation from something being a social issue such as gender equity to actually a better investment.

Jean Chatzky: (03:18) When you started Pipeline, what was the mission?

Katica Roy: (03:21) So I was actually on a radio show for a game changing women. And the topic was negotiation and pay. And the host asked us if we ever thought that the pay gap would be closed in our lifetime. And I said, well, not until we make it an economic issue. And then I thought, I think I can solve that. So that was really the idea that if we move away from gender equity being about the right thing to do or a social issue, but fundamentally an economic opportunity that we could actually shift that conversation.

Jean Chatzky: (03:50) The American Association of University Women predicts that the gender pay gap will not be closed until the year 2119. What do you think of that?

Katica Roy: (04:00) It’s true.

Jean Chatzky: (04:01) It is?

Katica Roy: (04:01) Yeah. And we have 208 years in in the USA before we reached gender equity. Pay is part of that. But things like equal representation in Congress, CEO’s, et cetera.

Jean Chatzky: (04:13) Why is it taking so long?

Katica Roy: (04:16) That’s a excellent question.

Jean Chatzky: (04:18) I mean, I looked at that study, so I just, I just wrote a book called women with money and it found a lot of excellent research about the amount of money that is flowing into the hands of women because of trends in education, in not just undergrad, but graduate school, in inheritances, the fact that we’ll live longer. So we’ll inherit from our husbands as well as from our parents. And then I saw that number and I thought these two things don’t seem like they line up to me.

Katica Roy: (04:50) Yeah. So I think you have to, there’s a couple things that make a difference, right? So we saw in the last election that we increased the representation of women in Congress by four points. And that’s excellent. We still have 27 points left to go if we’re actually going to get to gender equity in political representation. And of course we’ve never had a female president in the United States.

Jean Chatzky: (05:13) I know.

Katica Roy: (05:14) And that actually interplays very much with closing the gender equity gap including in economic representation because women, when women have an input into policies that actually ties to increased participation of women in the economy. And of course, part of that is wages and then you can solve things like wealth inequality.

Jean Chatzky: (05:39) Can you talk a little bit more about that? When women have input into policy, how does it change the landscape?

Katica Roy: (05:46) It does. Yeah, I can. So 1992 was the first election that I could vote in. It was also the first Year of the Woman, so we called 2018 the year of the woman, but 1992 was the first Year of the Woman. And that was actually when we elected the most number of women to the United States Senate, which was six, which seems like a pretty small number now. But one of the things that we saw was that as there was increased representation of women in Congress things like the FMLA, the medical leave act was passed. That was really the first time in the United States that we had any sort of protections. I mean it was unpaid, but at least we had protections for leave. We have seen, for instance, just on the House side in this last Congress, things like the paycheck fairness act has passed the House. So that bars, for instance, employers from asking about previous salary it begins to take some of the inequities out of the system that is actually ultimately holding women back, but ultimately holding everyone back. And a lot of that happens from lived experience. You know, so probably the most recent example of that was in the first presidential debate with Kamala Harris talking about busing and what made her statement so powerful was not only around the implications but the fact that it actually impacted her. That’s the lived experience that women bring went to elected office and it informs the decisions that they make and how they write policies. And because of that they write more inclusive policies that ultimately lead to more people, women in particular, participating in the labor force.

Jean Chatzky: (07:33) So what exactly does your company do and how does it help companies lean in, for lack of a better word, to this landscape of fairness?

Katica Roy: (07:43) Yeah, so what we found was a couple of things, we found this trend. One was that there is an increasing number of companies that are committed to gender equity. Typically through a public pledge, we hand counted them. There’s 3,800 of them. And we also saw a trend of 78% of CEOs saying that gender equity was in their top 10 priorities. And then on the flip side of that, only 22% of employees actually seeing it regularly shared and measured. So sort of this question of, I’m committed to this, but how do I operationalize that commitment? And so what we actually do is it’s the company’s data and our algorithms. So we essentially attach to their systems and when they are going to make a decision, and there’s essentially five buckets of decisions that you make about your talent: so hiring, pay, performance, potential, and promotion. So you post a job requisition, you write a performance review. That actually then goes through the pipeline platform and we debias those four companies.

Jean Chatzky: (08:44) So you debias, those before you might debias a performance review before it goes to the employee?

Katica Roy: (08:50) Exactly.

Jean Chatzky: (08:52) What do you take out?

Katica Roy: (08:53) So we do two things. The performance review module one is we actually use natural language processing to read through the performan

Final Thoughts

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Originally published at savingswitch.com.