Gender Pay Gap Costs Women Professors Half A Million Dollars Across Lifetime

There are substantial, long-term impacts from the gender pay gap for faculty at Canadian universities.

Recent research from our multidisciplinary team, which includes expertise in equity policy, political science and cognitive science with mathematical modelling, shows that over the course of a career and retirement, this pay gap leads to a difference of roughly half-a-million dollars.

The gender pay gap for faculty in Canadian universities is significant and persistent. Women professors earn on average 10 percent (or $10,500 per year) less than men for the same work.

This gender pay gap can result from bias in determining starting salaries and subsequent merit pay, from differing rates of promotion and from the punitive effects of parental and caregiving leave.

Focusing solely on pay differences, however, leads people to underestimate the long-term financial consequences of gender inequities as the pay gap also has implications for pensions.

Case study for women professors

Quantifying the effects of the gender pay and pension gap (research not done in over 30 years) poses a challenge, given the many variables at play.

To address this challenge, our team used King’s University College as a case study. Using King’s made the challenge more tractable because potential bias was confined to starting salary and promotion decisions. Unlike many universities, King’s does not offer merit pay, and faculty have a defined-benefit pension plan.

We were able to examine the effects of bias in starting salary, based on the determination of how many years of relevant experience people had at hire, and in promotion to full professor.

Women faculty at King’s made nine percent less than men on average. This calculation was based on all full-time professors, including both racialised and non-racialised faculty. We took this nine percent average difference ($8,771) as our starting point. We then calculated the pay and pension gap across a 30-year career and 21-year retirement for different career trajectories.

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We calculated what would happen if a woman progressed through the ranks to become a tenured associate professor and remained so for the rest of her career, compared to a man in the same position.

We calculated what would happen if she was promoted to full professor, compared to a man in the same position. Promotion to full professor is based on one’s research contributions. Most professors don’t achieve this position, although men are far more likely to do so than women.

We found that a $9,000 difference in starting pay led to a cumulative pay and pension gap of $454,000 at the associate level, and a $468,000 gap at the full professor level.

We also calculated what would happen if a woman was not promoted to full professor compared to a man who was. In this more likely scenario, the pay and pension gap was $660,000. In retirement, this gap translates to a $7,000-$12,250 per year difference in pension, depending on the scenario.

Racialised inequities

Our research focused solely on gender, given that race was not a variable provided in the available Statistics Canada data or at the institutional level. This ongoing issue has been highlighted with urgent calls for better data collection.

Data from the Canadian Association of University Teachers shows racialised professors experience a 10 percent pay gap relative to their non-racialised peers. Racialised women professors, in particular, experience greater pay inequity.

Given that the gender pay gap for racialised women professors is double that of their non-racialised women counterparts, it follows that racialised women professors face larger lifetime salary and pension gaps than our calculation for women professors overall.

Pay equity legislation, however, remains fixed on gender; it doesn’t currently address wage penalties faced by Indigenous, racialised and 2SLGBTQ+ faculty.

Correcting imbalances

Universities have used salary anomaly studies and wage adjustments to address the gender pay gap. Corrections have been done either on an individual basis or across the board for women faculty, but without retroactive pay. King’s just completed its first study and awarded women one additional year of experience going forward (a $2,506-$2,770 per year boost, depending on rank, under the current contract).

Yet salary studies, while helpful, have tended to insufficiently address the problem. Without addressing the systemic bias that leads to pay differences, the gap is often reintroduced or increases over time with new hires and with promotion (or due to merit or market factors). Taking a gradual approach to pay equity also likely costs more over time than taking meaningful steps to close the gap.

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What universities can do

So what additional steps can universities take to address the gender pay gap? First, they can provide greater transparency. Faculty should be made aware of the criteria being used to assess their experience and performance, the variables and data available to measure the gender pay gap at their institution, and how their school is rectifying it.

They can foster environments for women researchers to thrive and encourage them to go up for promotion (68 percent of full professors in 2019 were men). Women and racialised faculty’s research and career progress were more negatively impacted by the pandemic.

They can address the power gap in senior leadership: Despite ongoing equity, diversity and inclusion efforts, most senior leadership posts remain unaffected. In 2019, men continued to make up 80 percent of the presidents, 60 percent of the provosts and vice-presidents, and 58 percent of the deans in Canadian universities. Only one in five of the top earners at Canadian universities were women, while only three in 100 were identified as racialised women.

60 years to close gender pay gaps?

Our research shows that the gender pension gap is substantial — with a third or more of the full gap (pay and pension) owing to pension, leading to greater long-term inequities for women than previously estimated.

The World Economic Forum suggests that at this rate, both within and outside academia, it’ll take another 60 years to close the gap. Sadly, our daughters will still be waiting for equity when they retire.

Marcie Penner, Associate Professor of Psychology, King's University College, Western University and Tracy Smith-Carrier, Associate Professor and Canada Research Chair in Advancing the UN Sustainable Development Goals, Royal Roads University published this article first on The Conversation.