The recent media blitz on the stalling of gender equality and women locked out of executive levels in business are stuck on behavioral issues and ignoring the economic and financial opportunity cost to women. Achieving economic, financial and social inclusion of women of all viewpoints has a direct impact on the long-term health of the economy, return on investment in education and the quality of life of women and their families.
This article addresses the:
- Value our economy is losing by systemically minimizing the contribution women can make through, product innovation and business formation
- Incremental value of women in the workplace
- Opportunity cost to organization and business performance by devaluing the leadership and management styles of women
- Narrowly defining women with different cultural and ethnic perspectives into low compensation and advancement
A woman has to earn a Ph. D. to earn as much as a man with a Bachelor’s Degree
At all levels of educational attainment women earn on average 25% less than menSource: Georgetown University Center on Education and the Workforce
The cost of ignoring women’s education, experience and innovation
The minimizing of lifetime earnings of college-educated women is one way to measures the loss to the U.S. economy and innovation by women. Women are not trying to break through a glass ceiling. Women are trapped in systemic barriers to advancement and equal earnings no matter what the skill, experience and education.
Consider the impact on lifetime income for women at the Bachelors’, Master’s and Ph.D. levels as compared to men based on statistics from the U.S. Department of Education the key findings on gender are:
- A man can expect lifetime earnings of $2.6 million with a Bachelor’s Degree.
- A woman with a Bachelor’s Degree will earn only $1.9 million over her lifetime.
- A women has to earn a Ph.D. to earn as much as a man with a Bachelor’s Degree
- At all levels of educational attainment women earn on average 25% less than men
In dollars the gap in lifetime earning averages $700,000 less for women than men. In addition women have invested thousands of dollars in tuition and living costs while in school and years of effort to earn their degrees. Women without degrees are further behind in lifetime earnings.
What could the U.S. economy look like if women were able to generate income at the level the average man with a Bachelor’s degree earns?
If all women with degrees at any level were able to earn as much as a man with a B.A. the economy would have added $21,490,000,000,000. Yes, that is $21.5Trillion dollars more in circulation in the U.S. economy. That is the results of multiplying the 30.7 million women with Bachelor’s Degrees and above times $700,000, the average gap in lifetime earnings.
The tangible cost to the U.S. economy from not tapping women is massive. Advanced education women are attaining is a gift to all industries and the public.
Imagine the 21st Century Experience of Women in Society and the Economy
Women choose to pursue the greatest value they can earn in their lifetime. This does require that women want to achieve the financial benefits of their talents, education, experience. Women have to believe they already have the education and professional experience to produce financial and economic improvement. With financial resources comes freedom and authority to create more equitable companies and supportive workplace cultures.
Take Charge of Your Career as an Employee
Seek out jobs that meet your goals for lifetime earnings. Given that women live longer than men, setting targets for lifetime earnings should be more than the $700,000 gap with men holding a B.A. Women need additional savings to support lifetimes 5 – 7 years or more beyond men. It is imperative to start career and employment planning before women have graduated from college in the following areas:
- Industries and companies that utilize talent and education
- Job titles that build performance and expertise
- Sequencing of jobs that lead to higher levels of pay and authority
- Opportunities to obtain patents
- Bonus incentives
- Team of advisors and sponsors for life
Leap into Leadership through Business Ownership
If you are a high performer delivering results but finding yourself stuck and frustrated then consider if you are a reasonable risk taker born to be a business owner or entrepreneur. Complete a thorough examination of readiness for business from a personal and business perspective. The big question to ask is do you have a strong ambition to:
- Build a customer base
- Develop products and services for sale
- Seize market opportunities
- Generate profits and equity based on customer demand
- Commit to a long-term effort to grow a business
Ownership allows you to derive the benefits of the work to grow the business and a leader as far as you are willing to stretch. Recognize business ownership is not an easy path. Using the wisdom you have developed through the challenges of business growth you can direct financial and other resources to greater business efforts and to personal missions.
As a business owner you can also build a culture within the company. You can influence the economy by consciously growing a high performing culture that respects and develops the viewpoints of all staff.
Ultimately, women of all cultures and experience can connect to new markets and seize opportunities to generate lifetime earnings well beyond a job.
Women Can Act Now to Increase Their Value and Lifetime Earnings
It is time to move beyond discussion about how women are not ambitious, hold back or fail to be assertive enough. The important discussion is how much value women can and do bring to the economy, industries, and markets. If women describe and better yet quantify the value of our contributions then we can make decisions and take the steps to achieve equitable lifetime earnings. Let us as women stop leaving money on the table and shape our economy.
Actions you can take today:
- View your education as an investment in future earnings
- Intend to use your degrees, accept accountability, develop expertise
- Choose the industries you work in carefully. Identify leading companies where women are in senior positions and recognized for contributing to industry
- Know the market rate for your skills and experience from placement professionals.
- Ask for market rate compensation in jobs that develop your ambition, expertise and leadership
- Recognize that your ideas and contributions are valuable and record them regularly
- If you choose to develop your ideas create a vision of the greatest level of success and let the greater vision pull you through manageable action steps to results
- Ask for advancement and compensation based on facts and contributions
- Look for opportunities to become an owner, partner or founder of a company. Earnings from a successful company are much greater than employment compensation.
- Pursue your deepest ambitions and clarify the purpose for building the companies, and a more equitable culture for all
- Women of color and all ethnicities need to seize the growth opportunity from increasing diversity. Demand for products and services from your point of view will grow. Start with delivering unique products and services to target niche markets and be the market leader.
Ambition in women is the perceived threat to men because it creates a picture of women competing with men for power and wealth. Replace these outdated views with your own definition of value from a women’s point of view. Women can honor their ambition with a compelling and valuable purpose. Ambition clarified with purpose and meaningful intent such as a passion to eliminate cancer, build a safer car or be the next great architect opens up opportunities. Find your purpose in business that engages you with people and customers. When your ambition mobilizes you to make your greatest contribution to your field then own it and take it to market.
_____________________________________________________________________________________________Sources and Notes:
Brian Burnsed, August 5, 2011, How Higher Education Affects Lifetime Salary, (US News). Women and minorities are paying a high price to get into the workplace let alone advance.
Source: The College Payoff, Education, Occupations, Lifetime Earnings, 2011
Anthony P. Carnevale, Stephen J. Rose and Ban Cheah
Georgetown University Center on Education and the Workforce
All data in this report are the authors’ analysis of the 2007-2009 American Community Survey
Notes of Graduate Degrees: Source: U.S. Department of Education, National Center for Education Statistics. (2012)
• Average cost of college a four year college degree – $88,400
• Average cost of a Master’s degree, 2 or more year effort – $60,000
• Average cost of a Ph.D., 5 or more year effort $250,000 – $300,000
Calculation of Opportunity Cost of Lack of Fair Pay for Women with College and Graduate Degrees
20.1 million women have bachelor’s degrees, 20.1 x $700,000 = 1,470,000,000,000 of lower wages in the economy just because of gender
10.6 million U.S. women have master’s degrees or higher
• Estimated 9.0 million women earn Master’s for a cost of 9,000,000 x $60,000 = $540,000,000,000 or $540B spent to earn less than men
• Estimated 1.6 million women earn a Ph.D. for cost of 1,600,000 X $275,000 = $440,000,000,000 to earn $416,000,000,000 more than men