In 2019, the highest paid women at U.S. companies earned 84.6 cents for every dollar their male counterparts made, according to a recent paper by researcher Morningstar, Inc. That is an improvement over 2015, when top women earned 81.5 cents on the dollar.
The persistence of the pay gap at the top of the corporate ladder reflects a lack of female leaders overall, the study’s author told Reuters. It also indicates that top female leaders are often in lower-paid executive positions such as head of human resources or marketing.
What will it take to see a change in the pay gap? The author suggests it will require more women at every level of the company so that there is a diverse pool of internal applicants for promotions.
“Companies can’t just solve for this at the top of the ladder, they have to look at the entirety,” she says.
It might require a reduction in the pay gap at lower levels of companies, as well. The study found that the pay gap was narrower at the top of the ladder than further down. According to the Center for American Progress, the average female worker in America earned 82 cents for every dollar an equivalent male colleague made in 2019.
According to the analysis, women held only 12% of named executive officer positions in 2019. That was up from just 9% in 2015. Of the Russell 3000 index companies sampled, 47% did have at least one female in the top ranks in 2019, compared to just 35% in 2015.
Those female executives tend to be quite well paid. In 2019, their median average compensation reached $1.76 million. However, the gender pay gap persists even in the C suite.
When it comes to corporate boardrooms, women have made faster gains than in the rest of companies. For example, the percentage of woman directors in Russell 3000 index companies was 23% in November, according to researcher Equilar.
This may be due to a greater focus on boardroom equity. It could also be because directors can serve on more than one board at a time.
The study comes at a time when there is increased attention on gender- and race-based pay equity due to social justice protests and the effect of the pandemic on working women. According to the National Women’s Law Center, as many as 2.3 million women have left the labor force since the beginning of the pandemic. That puts total workforce participation by women at 57%, which is its lowest point since 1988.
If women are to be equal in the C suite, they must achieve greater equity throughout their careers. The law and justice demand it.