Opinion

A Reality Check on the Financial Sector's Gender Wage Gap

Tensie Whelan

By Tensie Whelan and Elie Chachoua

In New York State alone, the economic lost opportunity is estimated to be around US$17bn per annum.

By Tensie Whelan and Elie Chachoua

Gender pay inequality has become a hot issue for corporate leaders. A few of the lead advocates for change have been investors, who cite studies that show significant financial benefits associated with gender pay equity.

In New York State alone, the economic lost opportunity is estimated to be around US$17bn per annum. To put this in perspective, this is more than a third (36%) of the construction’s sector contribution to NY State’s economy.

Oddly enough, this sector is actually the top performing one in NY State when it comes to the wage gap, with female workers earning slightly more on average than their male counterparts. The bad news is that the largest sector in the state’s economy, finance, is also the worst performer.

Citibank, which is headquartered in New York City, was the first financial institution in the US to publicly disclose its wage equity metrics in 2018, demonstrating a gap of 1% after adjusting for job function, level and geography. Early this year, Citibank took the brave step of disclosing its unadjusted “raw” median gender pay gap, finding a gap of nearly 30%. This difference between mean and median matters, as the latter provides important insights on the distribution of opportunities in the workplace.

Read the full article in The Economist.
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Tensie Whelan is a Clinical Professor of Business and Society and Director of the Center for Sustainable Business.