When Kimberly Nguyen, a New York-based contract writer working at Citibank, saw a posting earlier this year on LinkedIn for a position at the company very similar to her own but paying between $32,000 and $90,000 more than she earned, she applied.
She didn’t hear back, Nguyen told me. So she did what any self-respecting Gen Zer would do: She took to social media. “I don’t want to hear one more peep out of them about diversity, equity and inclusion,” she wrote. “I have told my managers multiple times that I know I’m being underpaid.” Much to her shock, her story went viral. It “resonated,” she says, because a lot of people “also feel like they’ve been underpaid, or found out accidentally their colleagues are making more than them.”
Until quite recently, Nguyen would have had a hard time accessing that salary information. But within the past year, a number of states and municipalities – including California and New York City – began requiring that job postings contain salary ranges in an effort to combat persistent gender and racial salary gaps.
How much we earn for a day’s labor is central to the worker movement we’ve come to call the Great Resignation, with lower-paying industries such as caretaking, retail and hospitality experiencing the most difficulty attracting workers. People who switched jobs during the period clocked larger pay gains than those who stayed with the same employer. Pay transparency is quite possibly adding fuel to the fire, but it’s in service of a just cause.
Many workers are angry about how little they are paid – and who’s making more, if they can even find out. Chief executives outearn their workers by a ratio of 399 to 1, according to the Economic Policy Institute. A survey by the Pew Research Center found barely one-third of the nation’s employees described themselves as satisfied or very satisfied with their pay, with women and Blacks more likely to say they were unhappy. A 2020 survey by jobs platform Hired found women were offered less money for the same job title at the same company than male peers a majority of the time. And the American tradition of secrecy around remuneration is part of what makes these inequities possible. Unless you’re in a unionized or highly standardized workplace where you know the pay scale of the workers around you, there might be no way of learning whether you’re being shortchanged.
Independent reporting for Pine Bluff & Jefferson County since 1879.
The advice to women, and to people of color, has been to lean in and ask for more money. When research revealed that women were more likely to be penalized for doing that than men, guidance shifted – to pointers on how to ask for equal pay for equal work. But in doing so, you were often starting without enough information. Were you making less than your White male co-worker? You either had to get him to tell you his salary, or find someone else willing to leak it to you.
Pay transparency is intended to attack this problem of information asymmetry. While employees suffer in the dark, employers benefit from their insider knowledge. “Employers have the power to close wage gaps. They are the ones with the information about what the pay is for other employees,” observes Andrea Johnson, director of state policy for the National Women’s Law Center.
Transparency efforts don’t fully take the onus off individuals to solve the wage gap problem, on their own – as Ngyuen’s story shows – but they do help create a more level playing field, in part by making it harder for employers to act on conscious or unconscious biases. A paper published by the American Economic Association found that Canadian laws demanding public sector salary disclosure reduced the wage gap for university faculty between 20 and 40 percent.
It’s not a perfect solution. Minus effective enforcement, some employers will try to game the system – companies have been flagged for listing salary ranges that vary by six figures. A greater concern is that some studies have found salary transparency within companies results in lower overall pay, with those on the high end losing out.
But the downsides are likely outweighed by gains. One unpublished paper found a Slovakian requirement to list salary ranges in job ads resulted in an increase of 3 percent in starting wages. And this info is especially prized by Gen Zers – the Adobe’s Future Workforce Study, released late last year, found 85 percent of college students and recent graduates would be significantly less likely to even apply for a position if salary data wasn’t included. Perhaps this explains why more than 40 percent of listings on Indeed.com – no matter where the job is physically located – now include such info.
As for Nguyen, she told me she still hasn’t received a raise. When I reached out to Citibank, a spokeswoman told me the now deleted listing stated the applicant needed between five and eight years of experience, something Nguyen, who graduated from college in 2019, doesn’t possess. She added that, in any case, the matter was really between Nguyen and Photon, the agency that employs her to work at Citibank. Photon didn’t respond to a request for comment.
So, Nguyen’s now applying for other jobs. She told me she won’t even apply for positions that don’t post a salary range. Knowledge, after all, is power.