Tag Archives: compensation

Study: Pay Scales Tip Toward Gay Men

happy man with moneyOver the past few years, the world has made some great strides in the acceptance of LGBTQ individuals. Same-sex marriage was legalized in the United States in 2015, same-sex adoption was legalized in all 50 states in 2016 and the transgender military ban was lifted in 2016.

Meanwhile, more than two dozen countries now recognize same-sex marriage, according to the Pew Research Center.

And now new research has revealed that gay men no longer experience a negative pay discrepancy when compared with demographically similar straight men. In fact, gay men appear to have reached a 10-percent earning premium – meaning they earn more than their straight-male counterparts.

The lead researcher for this study, Christopher (Kitt) Carpenter, professor of economics at Vanderbilt University in Nashville, Tenn., examined available data on self-identified gay men, which is harder than it sounds.

Not only is the overall self-identified LGBTQ population small, approximately 2 percent to 3 percent, but surveys haven’t asked about individual’s sexual orientation until very recently, said Carpenter.

For this study, he examined data from the nationally representative National Health Interview Survey, which began including sexual orientation in its questionnaires in 2013.

“For the past 15 years, I’ve been crunching numbers from every single data set I can find that credibly identifies LGBTQ individuals and their economic details. And for more than 20 years, studies have all concluded that gay men, when compared with straight men who come from similar economic backgrounds, earned approximately 5 to 10 percent less. This is the first study that has shown the opposite may now be true.”

The 10-percent premium surprised Carpenter and his co-author so much that they ran extra tests to determine if this earning premium  was a coincidence.

All previous literature points to gay men earning less. But test after test revealed the same thing: Gay men are earning more than demographically similar straight men.

“This finding has raised more questions than answers,” Carpenter said. “What helped the pay scales tip in favor of gay men – is it new legislation, or perhaps greater acceptance of LGBTQ folks? If this is the case, the implications of this study are to look closely at what is it about the nature of the workplace that has changed. If it’s anti-harassment and discrimination policies that’s great and should certainly be evaluated closer.”

Scholars have long thought that sexual-orientation minorities spend a lot of time and energy closeting themselves, he added. “They spend time worrying about whether their colleagues are wondering about them, or, if outed, will they be fired? This means that LGBTQ folks can’t perform to their full potential. Anti-discrimination and harassment policies are catalysts to change this.  Creating safe spaces for LGBTQ folks to just be themselves will only foster a more productive environment in and out of work.”

Carpenter hopes that these results will compel HR leaders to review and refine their own compensation policies and procedures because there’s still an enormous amount of evidence that points to the nature of discrimination in the workplace.

For instance, a recent study conducted in India found that discrimination against LGBTQ individuals may cost the country an upwards of $32 billion a year in lost economic output. That type of loss certainly isn’t in the best interest of anyone.

Employees: Pay Matters Most

payWe routinely feature, in our print edition and on our website, stories about the vital role played by leadership training, wellness programs, communication strategies and even office design in creating and sustaining employee engagement. But it shouldn’t obscure the fact that, for most employees, the bottom line is the bottom line — when it comes to engagement, pay is the most important factor.

The new Workforce 2020 survey, which queried more than 5,400 employees and executives in 27 countries and was conducted by Oxford Economics with the support of SAP, is the latest report to confirm this. The survey finds that two-thirds of the respondents cite competitive compensation as the most important attribute of a job. And it’s cross-generational: millennials and non-millennials alike cite comp as the most-important benefit, while 41 percent of millennials and 38 percent of non-millennials say higher compensation would increase their loyalty and engagement with the company.

This isn’t to undermine the importance of things like manager training and corporate culture: Studies have repeatedly shown that while competitive pay and benefits can lure employees to companies, having a positive work environment and a good boss play crucial roles in keeping them there. But if they feel under-compensated for the value they provide, it’s only a matter of time before greener pastures — or at least, the appearance of greener pastures — lure them elsewhere.

Do companies get this? The trucking industry doesn’t appear to. According to HREOnline columnist and Wharton School Professor Peter Cappelli, real wages for truck drivers apparently have fallen by almost 10 percent during the last 10 years — and even a critical shortage of truck drivers so severe that some trucking companies are unable to accommodate their customers’ needs hasn’t led to an increase in wages. Companies cite customers’ unwillingness to pay higher fees as a reason for not raising wages, Cappelli writes — and yet, trucking firms are perfectly willing to pass along higher fuel costs to their customers, he adds.

Cappelli ends his column on this provocative note: The trucking industry will either have to raise wages to attract the drivers it needs, or “we start hearing that we need to import more foreign drivers because ‘no Americans want to drive trucks.’ “