Racial bias, whether conscious or unconscious, in pay raise negotiations is an obstacle to finally closing the wage gap, a new study has found.
White men are far more likely to succeed at negotiating a pay raise than African-Americans are, according to a key finding from the Raise Anatomy study published Tuesday by data analysis organization PayScale, Inc.
“We believe most employers want a diverse workforce and fair pay for all employees, but our research shows that employees who ask for a raise may be getting different responses based on their race,” said Lydia Frank, vice president at PayScale.
Men of color were 25 percent less likely to receive a raise when they asked for one, and women of color were 19 percent unsuccessful at getting a raise. PayScale, a provider of on-demand compensation data and software, controlled for factors such as tenure and job level in the study.
While the unemployment rate for African-Americans has declined sharply, the wage gap between Blacks and whites has remained stubbornly wide. Economists at the Federal Reserve Bank of San Francisco were mystified that the gap has not closed more than 50 year since passage of the Civil Rights Act. The gap, they said, cannot be explained by “age, education and occupational differences.” Apparently, they failed to factor racism into their equations.
Since 1979, the average earnings of Black men compared to their white counterparts slipped from about 80 percent of white male earnings ($15 per hour vs. $19 per hour in inflation-corrected dollars) to about 70 percent of white male earnings ($18 per hour vs. $25 per hour) in 2016, according the Federal Reserve Bank. The trend is similar between Black and White women.
Hopefully, employers of the unconscious racial bias variety will see this study and look in the mirror. The researchers were optimistic.
“When requests and decisions about raises are transparent and rooted in data, employers are more likely to approach each conversation about pay in the same way,” Frank said.