Usually, when experts from the private as well as from the public sector talk about the gender pay gap, one is confronted with a fairly pessimistic view on the issue. Most studies suggest, that the gender pay gap is significant and that it’s widening over time and up the career ladder. The platform economy, however might change this view – and here’s how.
Women make only 81¢ for every 100¢ a man makes
For every dollar a man earns in the U.S. economy, a women working full time typically makes about 81¢ – this equals an absolute gender pay gap of 22%, benignant towards men.
Even the controlled gender pay gap confirms significantly lower earnings for women compared to men’s. Women with similar education, in similar positions and similar industries make still significantly less than their comparable male counterpart. Going up the career ladder to executive positions, the controlled pay gap widens to about 15%.
While the controlled gender pay gap is lower for recently graduated, young women, it widens after one to two decades after getting the degree. As research suggest this is most likely due to maternity leave around the late 20s to early 30s and a weaker position in salary negotiations.
No matter, what earnings indicator, absolute or controlled, you look at, the results show that on average working women make less money than working men.
Over the last couple of years, this issue was addressed by numerous policies. Legislatures passed laws such as the Equal Pay Act of 1963 that require large companies to proactively react to the pay disparities or to maintain a certain gender ratio in filling vacant positions.
However, it remains questionable, if these policies achieve the expected outcome of a fair treatment of both sexes.
58% of WorkGenius workforce is female
In the platform economy we can see a totally different picture: Since WorkGenius provides equal opportunities for all and has no differentiation in gender, race, or religion – the workforce comprises 58% women. The gender share on the platform represents approximately the gender share at American universities (56% female bachelor degrees in the U.S.), which makes sense because WorkGenius was originally exclusively accessible for college students. However, it is remarkable that the distribution of earnings is significantly different from “real-life” college graduates. All active women on the WorkGenius platform, make about 64% of the combined earnings. This means that the average female WorkGenius makes 1,26 times as much as the average male WorkGenius – a gender pay gap of 26%, benignant towards women.
Women earn 26% more than men on WorkGenius
Do platform economies empower women to make more money than men? How can we explain this phenomenon?
In traditional economic settings, where people work in large corporates with rigid structures, the different life courses of female compared to male workers cause significant salary disparities. Moreover, women’s behavior in salary negotiations is often less aggressive and therefore less successful. Platform economies however are structured differently. Not a rigid top-down hierarchy, but market mechanisms are set in place to connect labor to work – immediately and on-demand. Jobs (“gigs”) are extremely flexible and smart algorithms take over the hiring and matching processes, as well as the adequate payment.
Platforms level the paying field for women as maternity and aggressive salary negotiations are not relevant
It might be the case that in this environment certain life decisions such as maternity leaves aren’t “punished” by lower salary outcomes. As work and labour are always available on-demand, entering and re-entering the labor market is extremely convenient for both, men and women.
With the platform economy we are entering the future of work, which might be beneficial for working women around the globe.
“We only represent a small fraction of the on demand economy but we are excited to see women being top earners on our platform. “
Marlon Litz-Rosenzweig, CEO and Co-Founder of WorkGenius
WorkGenius provides a Digital Workforce to process projects on a large scale in high-quality. More than 300,000 experts on the Digital Workforce are extensively vetted and the assignment of jobs is handled by a proprietary AI. WorkGenius works with more than 5,000 happy partners around the world, having a 95% satisfaction rate. WorkGenius handles invoicing on enterprise level and complies with European and US labor and tax laws.
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