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Even Hip Startups Pay Women Less Than Guys

Female employees make 77 cents for every dollar men earn at these new companies.

startups pay women lessWe assume most startups are hip and progressive. But in terms of income equality, the new companies seem to be much like old companies: Women bring in significantly less than their male counterparts, according to a new analysis of 2,300 employees at small businesses and startups. In fact, these workplaces follow the same pattern as established workplaces: women earn a mere 77 cents for every dollar earned by guys.

This recent set of figures comes from a study run by Justworks (a human resources firm) analyzing salary information from clients including the mattress company Casper, web design firm Qubit and language school Fluent City. More than half of the firm’s clients work in New York City. “Even though we think we have a young and progressive customer base,” explained Isaac Oates, the founder and CEO of Justworks, “a lot of the patterns we see nationally, we see here.”

Oates explained that some of the gap can be traced to different kinds of jobs that women and men hold at these companies. Men tend to be over-represented in tech roles, which generally pay more. In addition, a greater total number of men work at these companies. Such trends hold for the bigger tech giants like Facebook and Google, too.

The analysis didn’t break down pay among various job roles, although the firm did study the gender makeup of several different positions.

The Justworks numbers correspond fairly well with the national gender pay gap, which shows that (as of 2014) women overall earn 79% of what men earn, and if you factor in women of color, the gap widens even further. These figures arise from Census data.

The wage gap is complicated, of course. If you compare women and men in the same jobs, it narrows quite a bit — but not entirely. But there are other factors at work: Women generally wind up in lower-paying lines of work. They end up in college majors that lead to lower-paying careers (such as education and social work). But the reasons female-dominated careers pay lower wages or the reasons that women wind up forgoing, say, engineering in favor of marketing are deeply intertwined with gendered expectations and stereotypes.

Women also are the ones who take the sideline on their own careers to care for children or family members, and that impacts lifetime earnings pretty significantly. Startups are also well-known for intense, 24/7 work cultures that are fairly incompatible with the demands of parenthood.

The Justworks data determined that women’s pay drops 9% between age 34 and 36 (a window when many women have children), but there’s no similar decrease for men.

There are certainly areas of hope, though. The software company Salesforce recently announced that it had spent $3 million to ensure that women and men are paid equitably at the company.

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Emery Reddy