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Time to secure a systemic answer to unequal pay

Pay equity goes beyond simply meeting regulatory requirements; it is fundamentally a vital business imperative and a moral obligation.

By Kathi Enderes | November 13, 2024 at 10:57 AM
Credit: Looker_Studio/Adobe Stock;

Over the past two years, my team and I have been examining the persistent, and frankly indefensible, issue of pay inequity. Our (The Josh Bersin Company) latest study has revealed some troubling insights, indicating that pay inequity remains an entrenched and systemic issue.Since 2017, there has been some progress in reducing the gender pay gap, which has narrowed from 18% to 15%. However, this progress has been slow and inconsistent. For managerial roles, the gap has decreased more significantly, from 14% to 10% over the same period, suggesting that leadership roles are making strides at a faster pace than the general workforce. Yet, these advances still fall short of what’s needed, calling for heightened focus from both organizational leaders and society at large. At the current rate, full gender pay parity isn’t expected until 2048, while equality in managerial pay is projected for 2036.In other words, true pay equity remains a generation away. But this issue transcends sociology or politics—it’s a business imperative. Our data reveals that pay equity is not simply a compliance checkbox or a “nice-to-have”–-it’s 13 times more influential on employee retention and satisfaction than pay levels alone.Leading organizations understand that fair compensation cultivates a positive work culture, enhancing both engagement and productivity. This is increasingly evident in companies like Salesforce, American Airlines, and SAP, which are demonstrating that embedding pay equity across all business practices and proactively addressing potential inequities in talent management can drive profitability, increase customer satisfaction, and secure a competitive advantage.If you’re ready to make lasting strides in closing the pay gap, here are some practical steps you can take as a CHRO to lead meaningful progress toward pay equity.

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