AI, Big Data, SaaS, cloud computing… tech companies are literally creating our future. But when it comes to salary equality between men and women, the tech industry is still stuck in the past.
Whichever way you look at it, we are still a long way removed from parity. There is an 18% pay gap in French tech (versus 10% in London, and 5% in the San Francisco Bay Area). And while companies are all too keen on preaching the diversity and inclusion gospel, digital banking giant Revolut can still get away with paying its female C-levels 30% less than their male counterparts.
Zooming out beyond the tech industry, the UN predicts that, at the current rate, it will take 250 years to bridge the global pay gap. Secretary-General Antonio Guterres correctly points out that “[gender inequality] should shame us all in the 21st century because it is not only unacceptable, it is stupid”.
The pandemic has accelerated the need for inclusion: women are almost twice as likely to have lost their jobs in the past year. On the bright side, companies that are serious about diverse recruiting will find an abundance of highly-skilled women who are ready to bounce back.
If we are serious about closing the gender pay gap in tech by 2050, we need to act on two fronts simultaneously, according to Caroline Ramada, Founder of 50 in Tech: First, tech companies need to embrace salary transparency and fair hiring and promotion practices. Secondly, women need to be empowered to succeed in tech, starting with better negotiation training.
Companies are failing women in tech
The pay gap is the visible result of a series of invisible forces holding women in tech back. The first is gender bias, which 39% of women say is a primary reason for not being offered a promotion.
Combine that with 66% of women reporting that they do not see a clear career path for them in their current roles, and what emerges is a picture of failed mentorship and bad decision-making.
Countless surveys have found that women want more mentors, role models and networking opportunities to help boost their careers. Faced with a lack of company-wide support structures, many women fall back on “do-it-yourself” solutions, adding significant strain and stress to what is already an uphill battle. No wonder, then, that women are 22% more likely to experience imposter syndrome in the workplace, as well as experiencing psychological pressure that often leads to burnout.
Retention is another area where companies are dropping the ball. While women make up just 25% of the tech industry, 1 in 2 decide to leave the industry after 8 years, citing reasons of discrimination and harassment. In 2021, as many as 72% of women in tech said bro culture was pervasive at their company, and 78% felt they had to work harder than their male coworkers to prove their value.
Perhaps we should be most concerned by the fact that a whopping 46% of women say that they have experienced discrimination and harassment in the European tech sector. Now more than ever, we owe it to them to create safe spaces and “detoxify” corporate/tech culture once and for all.
Conditioned to demand less
Besides these systemic mailaises which have metastasized throughout the tech ecosystem, there are also individual, and often self-imposed, barriers to salary equality.
For instance, women are less inclined than men to negotiate their salary or pay raise. They are also four times less likely than men to ask for a raise—and when they do, they typically request 30% less. Women are also less likely to speak up during meetings and assert themselves. To make matters worse, many women do not know their worth: while 71% of men say they will only change jobs if it includes a salary increase, only 20% of women claim the same.
However, framing the impostor syndrome as an individual problem is a mistake. Too many internet career gurus teach theories about how to overcome imposter syndrome, all the while ignoring that the condition is itself a result of a sexist society.
As Michelle Obama correctly points out, “Women have been told for so long that they don’t belong in a classroom, in a conference room, or anywhere else we take real decisions, that when we finally get into the room, we always feel like we don’t deserve our place at the table. We question our judgment.”
That’s why we need to ensure that women are equipped with the necessary tools and mindset to ace their salary negotiations.
Three ways to close the pay gap by 2050
At 50inTech, we are part of a global movement that is closing the gender pay gap in tech. We provide best-in-class jobs to women in tech with companies determined to break down barriers. We empower them with personalized coaching and actionable tips to excel in their career path and we encourage peer-to-peer networking and value role models. We support companies to build a strong D&I culture that encourages the hiring, promotion, and retention of talented women. We partner with startups and large companies such as Slack, Doctolib, BackMarket, Dataiku, Prestashop, Blablacar and Orange.
Looking to the future, we have identified four effective ways to close the gender pay gap.
- The Compensation Calculator
For too long, women have been conditioned to expect to earn less than their male counterparts, thus reinforcing the actual pay gap. Luckily, this gap in expectations is closing due to increased salary transparency: where in 2019 women expected to earn 6% less than men in 2019, that figure has halved to 3% in 2020.
One way to improve this gap in expectations is by using a “compensation calculator”, which was invented by Github to better align compensation with the company’s values. It is essentially a transparent and benchmarked system that calculates each individual’s salary based on a series of inputs, such as place of residence and job level.
Having this type of salary transparency empowers women because they are able to view how much their male counterparts earn, which strengthens their negotiating position and gives them essential insight into what to expect and how to value themselves.
The good news is that tech companies like Glitch, Balsamiq, and even legacy companies like Starbucks and McDonald’s, have embraced the trend and are increasingly releasing statistics about how they compensate their workforce.
- Negotiation skills 101
Once women have understood their true value by benchmarking their skills to a transparent salary grid, the next step is to demand what they are entitled to. The key to a good negotiation is preparation and practice. No matter whether they work in sales, product, tech or marketing, a good negotiation can be divided into three parts: preparation, practice, execution.
In the preparation phase, women have to think carefully about the following question: What do they want and why do they want it? Whether you’re asking for a pay raise, you want to change departments, or you’re hoping for more vacation days: you first need to nail down your main motivation.
The practice stage is all about figuring out your flash points. List the reasons a manager might say no, as well as the things they might say that are likely to make you react strongly, such as: “we don’t have the budget for this,” or “we’ve never done this in the past,” or “the timing is wrong”. Anticipating these questions and rehearsing your replies will help you feel calm and confident on the spot.
Last but not least, when the moment to step into your negotiation arrives, make sure to lead the meeting in a constructive way by thinking about the format, and adopting the right tone of voice. Depending on the situation, sometimes the best negotiation technique can mean not saying anything at all and letting the manager fill in the awkward silence.
What’s the best way for women to master their negotiation skills? Forming part of a supportive community and hearing from negotiation experts in tech.
After a successful 2020 edition with 1500 attendees from 49 countries, 50inTech is back with a free bootcamp for women in tech.
On the agenda during this second edition of the “What I Really, Really Want Bootcamp”: the state of salary inequality, the importance of intersectionality, and actionable tips on how to master the financial side of the negotiation.
- The power of tools
Software solutions such as PayAnalytics enable HR managers and recruiters to measure pay gaps at a micro level and respond to recommendations on how to close those pay gaps. They provide essential insights into the specific biases at an organizational and employee level. After all, measuring the problem is the first step to solving it.
Real-time compensation data such as that offered by digital compensation platforms should inform high-level decisions about pay grades. Tech firm Buffer has stated that salary transparency helped reduce its gender pay gap from 15% in 2020 to 5.5% in 2021. Being transparent about who earns what forces managers to become more accountable and motivates women in lower-paid jobs to climb up the salary scale. Some companies also carry out “systematic augmentation”, where if a man negotiates a pay raise a woman automatically gets one as well.
And then there are communities and platforms, such as the one we’ve created at 50inTech, where the tools meet the people. Community-driven inclusion is a growing force in the tech industry, and we are extremely proud of helping thousands of women get better pay, or move to more inclusive jobs, as well as giving companies access to the best and brightest female tech talent out there.
Why diversity matters
Despite a decade of positive advancements on the long and winding road to gender equality, there is still a gaping pay gap in the tech industry today.
This is all the more puzzling given that, whichever way you look at it, women are the future of tech. Not including them is a huge opportunity cost, since diverse companies are more likely to grow, perform better, and have a greater competitive edge.
According to McKinsey, companies in the top quartile for gender diversity are 15% more likely to have financial returns above their industry’s national medians. And by fostering an environment where “out of the box” ideas can thrive, diverse companies are 45% likelier to report a growth in market share over the previous year and 70% likelier to capture a new market.
From the 50inTech community, the company Saagie provides a good example of how sourcing talent directly from community events pays off. With 25% in technical roles, 40% in managerial roles, and 35% in leadership, Saagie easily doubled its diversity figures by using this approach.
As the end of the year approaches and tech companies do their annual performance reviews, they would do well to remember that, from November 3rd onwards, women will work for “free” for the remainder of the year.
Clearly, we still have a long way to go to close the gender pay gap. The only way we’re going to get there is if companies and women in tech act together—now.
Article by Caroline Ramade, CEO and Co-Founder of 50 in Tech.