Study: Top Women Executives Help Close Wage Gap
Women at the lower end of the pay scale rarely witness a boost
When women take on leadership roles at their organizations, odds are good that the gender-based pay gap will narrow or even close near the top of the org chart. But the gap actually widens lower down in the ranks, according to a new study published in The Economic Journal.
The report, titled “Do Female Executives Make a Difference? The Impact of Female Leadership on Gender Gaps and Firm Performance,” says that on average, female employees who were among an organization’s top 25 percent of earners saw their wages increase by 10 percent with female leadership—but for women in the bottom 25 percent, wages fell by 3 percent. For men, the effect was the opposite: High earners saw their wages go down, but low earners received an increase.
The findings of the study, which examined aggregated data from the Italian manufacturing field from 1980 to 1997—a sample that included about 1 million workers annually—implied a stronger focus on performance by organizations with a female CEO at the helm. The study focused on almost 800 organizations where women made up about 21 percent of the workforce; only 2.5 percent of those organizations had a woman CEO.
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