Study: Women Pay Themselves Less Than Men

Study: Women Pay Themselves Less Than Men

As it picks through the rubble of the midterm elections, one of the bigger challenges for the Democrat party is recognizing not so much that its policies are perhaps too left-wing for the public, but that they are largely irrelevant. It turns out that, even on issues voters care about, real life does not reflect the simple, sound-bite world inhabited by most Democrat politicians. This fact is evidenced by a new study which finds that even when women are in charge of compensation decisions, they tend to pay themselves less than men.  

The study, led by the London Business School, looked at social entrepreneurs who founded non-profit organizations in the UK. Female founders of these organizations paid themselves about 23% less than their male peers. In other words, women paid themselves less than men–even when the women had complete control over setting compensation. Surely, the women are not discriminating against themselves. 

A recent Goldman Sachs survey of 10,000 small business owners found a similar phenomenon. Female business owners paid themselves, on average, just 80% as much as male owners. The factors underlying this disparity–choice of industry sector or preference for greater personal time–are similar to those found throughout the rest of the economy. Emma Jacobs, a writer for the Financial Times noted another factor from the UK study: “One big difference was that female-led social enterprises were generating less revenue than their male peers.” Whether or not maximizing revenue in an organization is a choice, men may simply put a higher value on increasing revenue as a means to increasing their own compensation.

This research goes a long way to promote understanding of why Democrats’ heavy focus on “gender pay equity” fell on deaf ears with voters this year. It is a fine issue in the abstract, but in reality, it is mostly meaningless. The notion that there remains some societal, systemic discrimination keeping women’s compensation artificially low is daft.

Any disparity is almost completely the result of different life choices made by men and women. How else could one explain the fact that the Obama White House and many Democrat Senate offices pay female staffers much less than males?

No doubt, there was a time that women had to fight against pay discrimination–just as, long ago, women had to fight for access to birth control, another inexplicable focus of recent Democrat campaign rhetoric. Those days are long since past. While the septuagenarians leading the Democrat party relish the chance to relive the fights of their youth, most of the American public has moved on. 

Life and the freedom of choice that comes with it are far more complex and more fulfilling than Democrat campaigns realize.