The Grass May Be Greener for Women in Industry

A new study finds the gender pay gap is wider -- 1.5 times wider -- in academic science than industry, despite academe’s progressive ideals and reputation.

“Our study provides empirical evidence that it may be time to reassess the reasons why women disproportionately sort into academia in the first place,” the paper says.

For the entire period studied, 1995 to 2017, women with science and engineering Ph.D.s earned 5.3 percent less than men in academe, compared to 3.5 percent less than men in industry. Researchers looked at the gender pay gap in both sectors from 1995 to 2003 and, separately, from 2006 to 2017, as well. They found that this gap actually increased over time in both sectors, though not significantly, based on further analysis. Still, the pay gap did not lessen over time, meaning the issue is not necessarily a generational one that will resolve on its own over time -- perhaps especially in academe, where men and women tend to start off with similar salaries but diverge over the span of their careers. In contrast, women in industry tend to be paid lower at the start of their careers, with the gender pay gap narrowing over time.

Because the pay gap in academe seems to start growing around the seventh year of full-time work, the authors attribute the pay gap in part to the rigidity of tenure system relative to the more flexible timelines businesses can offer their employees.

“There is no difference in rookie salaries [in academe], and that’s something that I attribute to the change in institutional norms and so on,” said co-author Rajshree Agarwal, Rudolph Lamone Chair of Strategy and Entrepreneurship at the University of Maryland’s Robert H. Smith School of Business in College Park. But women “are disproportionately less likely to get tenure. And so they’re disproportionately more likely to stay in academia but shift to these clinical faculty roles,” which pay less than tenured positions.

It’s not just that women are overrepresented among nontenured faculty, in what Agarwal calls a “double whammy” to lifelong earning potential: non-tenure-track women are also paid less than non-tenure-track men, some 13 percent less, on average, by midcareer.

Agarwal said there’s no simple answer to this problem, but she endorsed programs such as ADVANCE, funded by the National Science Foundation, which help introduce nuanced equity interventions at the local level.

“What they're saying in a very healthy manner is, ‘What can we do to help women be our best selves? If there are pipeline issues, how do we address these pipeline issues? If there are mentoring issues, how do we allow for mentoring? Or do we need to reframe the idea that women negotiating for a pay raise or asking for a pay raise is bad?’” Agarwal said.

Such questions will be all the more important post-COVID-19, she added, given that women have in many cases shouldered the burden of increased caregiving demands.

The new study is published in Nature BioTechnology. Its findings didn’t surprise Joanne Kamens, executive director of the Bentley University Center for Women and Business, who said that women, along with underrepresented minority faculty members, have been shown to complete more service work than their white male peers, and this work is not rewarded in terms of pay and promotion in the same way that teaching and especially research are.

More than that, Kamens said, “the complex processes and politics of academic institutions lend themselves to such disparities.” Academe’s "informal" management structure doesn't lend itself to organizationwide efforts to improve equity, she continued, “and there's a strong lack of transparency around salary and benefits for recruited faculty.”

These factors lead to disparities “resulting from implicit and explicit biases towards women and members of historically underrepresented groups,” she said.

Agarwal and her co-authors controlled for multiple factors, determining that the wider pay gap in academe was not related to changes in gender composition across Ph.D. cohorts, family-related issues, workload or differences in pay motivation. In fact, women in academe across career stages were more motivated by pay than were academic men, according to the study.

Investigating -- and Closing -- the Growing Gap

Comparing sectors further, researchers found that the average pay for industry scientists is higher than for academics at every career stage, regardless of gender.

The gender pay gap also emerges differently in academe and in industry, according to the study. In academe, men and women are paid equally upon hire, but their pay gap widens over what the researchers call “career age.” More precisely, women in academe experience a significantly slower rate of pay increases than men after about the seventh year post-Ph.D. The rate of pay increases for women at this stage lags behind men by about 4 percent at this time, to about 9 percent by 24 years post-Ph.D. What does this look like? By about the midcareer point, some 16 to 18 years post-Ph.D., male academic scientists with typical profiles make about $62,300 annually (in 1995 dollars), compared to $57,800 for women. The difference is 7.2 percent.

Again, in industry, men are paid more than women initially, but this gap narrows with career advancement. Male scientists with a typical profile earn about $86,600 midcareer, compared to $84,300 for women. That difference is 2.7 percent.

“A mid-career woman industrial scientist has much better odds than her academic counterpart of earning a salary close to that of a comparable man, and this pattern holds for more advanced career stages as well,” the study says.

Seeking to understand what they were seeing and why, the researchers next sorted jobs types by who held them -- men or women -- and their earning potential. Determining that tenured and tenure-track jobs in academia are “high-value,” including for their higher earning potential, and that the same can be said for leadership positions in industry, the researchers sorted jobs with this in mind. Ultimately, they found a significant gender gap in women’s probability of holding tenured or tenure-track jobs: from 1995 to 2003, women trailed men by about 15 percent in the odds ratio of holding a tenure-line job. Women trailed men by about 28 percent in the later period, from 2006 to 2017. The difference is statistically significant.

Importantly, the gender pay gap did not increase over time for tenured and tenure-track faculty members. The gender pay gap in pay increase over baseline entry pay did widen over time among full-time, non-tenure-track professors, to about 13 percent some 10 to 21 years post-Ph.D., however. This means that the gender pay gap in academe is attributable to salary differences off the tenure track, where the “disproportionate sorting of women” has also increased over time, the authors say.

About half the industry sample had a leadership role, with at least one supervisor of other employees reporting to them (a robustness check changed this definition to two supervisors reporting, but the results were consistent). These leaders were paid about 8 percent more than their nonleader colleagues. But there was a significant gender gap in the proportion of STEM Ph.D.s holding leadership positions, the study found -- about 15 percent. There was no significant gap in pay increase over baseline entry pay between men and women.

“Although women are less likely to hold a leadership job in industry (thereby earning lower salaries), there is no gender gap in rate of pay increase,” the authors wrote. “Our analysis revealed that academia, far from being the promised land, has a 1.5 times wider gender pay gap than industry, even after controlling for an extensive list of covariates.”

Within both sectors, “we see a higher likelihood of women sorting out of high-value jobs,” the authors continue. But more importantly, “our results indicate that although structural shifts in academia have an increasingly adverse impact on women, the same trends are not observed in industry.”

For their study, the researchers considered data from the NSF’s survey of 32,421 full-time, working science and engineering Ph.D.s. While they can only speculate about the causes behind their findings, they call for more attention to and research on the factors driving the sorting of women out of “high-value” jobs, and on “which specific institutional forces in academia contribute to the larger gender gap relative to industry.”

For example, the researchers say, the pay gap that widens between men and women at the seventh year post-Ph.D. coincides with the typical tenure decision period. Industry has no parallel “up-and-out” promotion system, meanwhile, potentially to the benefit of women in particular.

While Agarwal said she advocated “bottom-up,” localized and even individualized interventions, Kamens, at Bentley, said that leaders at the “highest levels of academic institutions would need to implement inclusive hiring and benefits processes,” including salary transparency, and “minimize the subjectivity in the process” in order for things to change.

These college and university leaders would also have to ensure, through data collection and disparity mediation, that their guidance was carried out across their institutions and maintain equity over time, Kamens said.

Experimental psychologist Mary Amon, an assistant professor at the University of Central Florida’s School of Modeling, Simulation and Training who was written about the “glass ceiling” for women in science, like Kamens said that implicit biases are thought to play a key role in STEM gender inequities.

Given that academe often awards pay raises in the form of percentage increases, Amon continued, initial salary differences are “exacerbated as women rise through the ranks of leadership.”

One option for overcoming such salary discrepancies is for campus leaders to “proactively compare and equalize salaries across genders with every promotion and pay increase,” Amon said. In any case, the awareness of STEM gender inequities doesn’t necessarily translate into action, she added, so it's “essential that universities don’t just talk the talk” but also “walk the walk by using evidence-based incentive structures and policies for retaining and advancing diverse STEM faculty members.”

One clear challenge to progress is that “long-standing incentive structures have been slow to change in academia,” she said.