Average gender pay equity gap is 27% — 5 insights

The average gender pay gap is 27 percent at typical large-scale global organizations, according to a Gartner analysis of Glassdoor's research on employee salary data.

Here are five insights about pay equity from the Gartner analysis.

1. Out of the 27 percent gender pay gap, nine percent is attributable to occupation choice, six percent is linked to organizational factors such as size, industry or geography, and five percent is related to human capital factors, such as differences in educational background and experience. However, these factors do not account for the remaining 7.4 percent of gender pay inequity.

2. Over 70 percent of organizations have started to address pay equity, but less than one-third of them believe they have been able to successfully close existing pay gaps at their firm.

3. Pay equity issues within companies result from group-to-group gaps and role-to-role gaps. Group-to-group gaps occur when women are concentrated in lower-paying roles than men. In contrast, role-to-role gaps occur when two employees are paid differently for doing the same job, despite having the same qualifications. 

4. One-third of employees perceive pay gaps at their organization, but tend to overestimate the size of these gaps. Women tend to overestimate them more than men. These perceptions, regardless of whether they are correct, lead to a 16 percent decrease in intent to stay with the organization among both male and female employees.

5. Role-to-role gaps are increasing. The average cost to correct gaps is increasing by approximately $440,000 per year. Organizations that work to close pay gaps now will pay less than those that do not begin to invest in pay equity.

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