Women have the Same Role, Same Results but Different Pay. Why the gap still exists! - Kweilin Ellingrud

0:00When women are negotiating on behalf of their team or their family or someone else, they negotiate equally effectively, frankly, if not more, right? But when we're negotiating on our own behalf, we don't do it as frequently. And when we do, we're about three times more likely to be perceived as selfish, pushy, bossy.

0:21What would happen if we just told the truth? Welcome to TruthWorks, where we dig into the nitty gritty of leadership and work. And what needs to change. I'm Jessica Neal. And I'm Patti McCord. Our journey together started in HR, but trust us, it's evolved into something wild, honest, and well, a bit rebellious. So throw out the handbook. We're here to redefine rules to work for us, not against us. Let's dive into another episode.

0:59Hi, everyone. Welcome to another episode of TruthWorks. I am here solo again because Patti's still recovering. Get better, Patti. We love you. But I have an amazing, amazing guest here with me today. And I'm going to let her tell a lot of her story, but I'll give a brief introduction. Her name is Quaylin Ellen Groot, and she is a senior partner at McKinsey. I'm sure you all have heard of that company before. And she is also their director of McKinsey Global Institute, right? And it's called MGI for short. But that's where she does all this research and leads training on the future of work around gender, racial equity, productivity, sustainability, and inclusive growth.

1:47So welcome to the show. We're so excited to have you. I want, there's obviously way more to your story. You have an amazing book that I want everybody to know about. So tell us your story. how did this all start? I want to know everything. Wonderful. Thank you for welcoming me. I'm thrilled to be here. Yes, yes. The story of the book really started 12 years ago, and I've been doing a lot of research on gender equality, really around the world and looking at the relationship between women in the workplace, and how they were progressing, or in some cases, not progressing, and how that was related to societal progress on gender equality topics.

2:28So I was looking globally, My colleague Lorena Yi, who is a co-author with me, was looking very much at that same question in the United States across kind of corporate Fortune 500 companies. And my other colleague and co-author, Maria Martinez, Maria Del Mar Martinez, was focusing on that problem in Europe, and she's based in Madrid. And so we were all researching this over the last 12 years or so. And as we put our heads together and as we've been sharing the insights from this research, we really felt like every time we would tell the story or the actions that people could take, it was new news.

3:02And if women don't know the data, the insights, if we can't peer around the corner to understand the pivotal moments, the pitfalls we might encounter across a career, it's really hard for us to make the best decisions for ourselves. And so we wanted to make it easier to access, kind of distill this 200-page reports into something accessible, meaningful. And then we also combined it with stories of success. So we interviewed over 50 women around the world, different industries, functions, of course, geographies, and combined those success stories with the data to make it a bit more memorable in terms of what are the ways to overcome these barriers, these broken rungs in a corporate landscape.

3:41Yeah, which thank you. We need to send, look, Patty and I talk about women equality a lot on the show, probably because we're women and have experienced all of these things. But, you know, first of all, we didn't mention the title of the book. So let's do that. Tell us the title of the book. The Broken Rung. The Broken Rung, which I love that title. It's just an issue I can't stop talking about because, you know, I do think like when I think about my career growing up and I was very fortunate that I got to a very high level, C-level job at, you know, a public company and consumer loved. brand at Netflix, but not many get there.

4:26And I don't, I didn't have resources and tools, you know, at all. I just, you know, I just worked hard and, you know, sometimes pretended like I was just one of the guys, sometimes didn't. But I think the hard work and maybe some luck paid off for me, but I really wish I would have had more tools. So I'd love to know, like, when you and your colleagues were off researching, and then you're sort of breaking it down from Europe to the US to global, what were the just surprising commonalities that you found that even you as a woman were sort of taken aback by? Yeah. I think as you look at the global landscape, The United States is really at the bottom of that top quartile in terms of gender equality.

5:18I think the biggest thing I was surprised about was how many companies globally have entirely male leadership teams, literally not a single woman on either in the CEO role or in those direct reports to the CEO. And it's just a shocking number of companies. I think in the United States, it's about 7 % of companies have entirely male leadership teams. So kind of that top 10 or so people, CEO and 10 or so direct reports in the C-suite. But as you go across the globe, there's actually a number of countries with actually even half-half, right? So in India, 50 % of the companies have entirely male leadership teams.

5:57In Japan, about 43 % of them. In France, even, 24 % of them. So I was just shocked at how many companies are, you know, led entirely by men with not a single female voice at the table. And frankly, even one female voice is not enough, right? There is this tipping kind of point effect where we need at least, you know, three, four, you know, real. Is that the tipping point? I think something around that 30 % tends to be the tipping point. And it depends on, you know, is it a board of directors that we're talking about? Is it a leadership team that we're talking about? I think below 30%, I really haven't seen great representation.

6:36I think whenever we're expecting a woman to represent the views of all women on a 10-person leadership team, that's just impractical and not humanly possible. When we get to three or more, that is when across different research, I have seen more of that diversity of thinking, more you represent your perspective, I'll represent my perspective, and we'll all get to a better answer because we bring different backgrounds and assumptions, and we're going to mix it up. And that's the whole point of diversity, right? Bringing those different perspectives to the problem so we can solve tough problems in a better way.

7:09Yeah, no, I mean, I've often been the only woman in the room on a leadership team. And I remember when I, at Netflix, I was the only woman C-level for, I don't know, a bit of time. And then we hired another woman who was our chief communications officer. And I felt different in the room because she was there. It really did. It changed things for me. I'm not convinced it changed things for the rest of the men, but it did change things for me. I felt like they heard me more because she was in the room, but I also felt like we were saying similar things that were different than what they were saying.

7:53Yeah. And so the dynamic changed, at least for the better for me. But I didn't realize how much of a difference it was going to make. And I think there's power in that allyship and partly a shared perspective and kind of patterns that everybody can start to see of, uh-huh, it's not just one person thinking this. This is probably a broader pattern and maybe we're missing something there. Yeah. And then adding women into these top level roles, I'm sure you have more data than I have, but it's changed a bit. There's more, but the change is very slow and there's not a lot more. It's absolutely not a lot more, Jessica.

8:36So right now in the United States, women are 29 % of C-suite. So direct reports to the CEO, 29 % of them are women. And even that belies a bit of the balance of power. Because as you described in your CHRO role at Netflix, chief communications officer, women are much more likely to be the head of a support function, which is a critical role. But we also need women to be playing heads of big business units, right? Leading big P &Ls. Because for Fortune 500 CEOs, when they're promoted from within, every year between 99 and 100 % of them are promoted from either running the biggest P &L or the second biggest P &L or that COO role kind of cutting across everything.

9:16But it's rare that we have the head of a support function promoted into that CEO role. And at one point, we had, I think, 5 % of Fortune 500 CEOs who were women. Then it was 7 % for a brief moment, then 8%. Now for a brief moment in time, we've been at 10%. But if we ever want to break through that 10 % female CEO ceiling, I think we have to not just have support function leadership, also add to that, that profit and loss kind of business leadership roles. Interestingly, at one point in time, we had more CEOs named John than we had all female CEOs put together. No, I know it sounds like a joke, but it's not.

9:56I'm laughing because I I totally believe that. Then at another point, we had more CEOs named Michael than all female CEOs put together. Now we're past that point, right? Because we're at the 10%. But it's still a long road because still, I think female CEOs are viewed as the anomaly, right? It's a Hail Mary. The business is really struggling. Let's put a woman in there. You know, what do we have to lose? It's been going poorly anyway. Yeah. It's still, it's only happened once. She can't mess it up even more, you know? Exactly. it's only upwards from here. But then it's, I think it's only happened once when a female CEO has replaced another female CEO, right?

10:33Since the beginning of time, we've had male CEOs replacing male CEOs, and then, you know, occasionally a one off. But we just have to shift that that pattern. Yeah, when I'm thinking about CEO transitions that I know about, like it is like if a woman's in the role, it always is a man that replaced it. That's very, that's true. Wow, this is just, I don't know. Okay. So it just hurts my heart. But so you do the research, you and your colleagues are writing this book, and this is a great revelation. But is there any other, like, I don't know, like things around women leaving the workforce or any other kind of ahas you had?

11:19Yeah, there's a lot of, I think, myth busting that we did together. One of those myths is exactly that, that, oh, women are voting with their feet, they don't want to stay in the workforce, they want to maybe take care of family at a higher rate. And in fact, no, women are just as ambitious. They want to be promoted at equal rates. They're not many of them are stagnating in roles, right? So if you talk to a vice president, male and female, who were just promoted, most likely the man has spent four years in the previous role and the woman might have spent seven years in the previous role. So we're not leaving the workforce.

11:52We're leaving and staying at the same rates. And when we leave, we leave to take care of family at roughly the same rates as well as men. But we are stagnating in roles. We're missing these promotions, this initial broken rung, this promotion to manager. We're either missing it altogether or it's taking longer. And that, Jessica, is despite the fact that we're doing so well academically, right? Supposedly, all of our academics are supposed to prepare us for the entry into the job market. And women for the last 40 years in the United States have been outperforming men. Right now, we're 59 % of college degrees.

12:25The majority of valedictorians, higher average GPAs. We're also the majority of master's degrees and PhDs. Academically, we could not be doing better. And then all of a sudden, right, you've prepared your whole academic career to get into the workforce. You get into the workforce and think about that talent pyramid, as you know well from your CHI roll days. 70 % of people, of employees, are at that entry level. Many will not actually make it past that entry level in their entire careers, right? They might retire from that entry level. And so everybody has to go through this first broken rung, this first kind of broken manager promotion.

13:01and the numbers are that for every 100 men who are promoted at that first manager promotion, only 81 women are promoted. And if you break out that number by women of color, it's 89 white women, but it's only 65 Latino women and 54 black women. So it's much, much harder for women of color to get promoted. It's roughly half the right, 54 black women versus 100 men. And that's that missed delayed promotion initially that everybody has to get through. And that's, you know, early days, right? That's typically before women are having children, right? Those kinds of barriers are not yet kind of kicking in, at least for many, but we're really already falling behind despite having excelled academically.

13:46Well, why is that? Is it just systemic, like, processes and thinking, or is there a different reason? Yeah, there are some systemic challenges, and then there are some actions and decisions that we are also making, that we have control to make differently should we want to. So we did a deep dive on the US pay gap. And the pay gap is for every dollar that men make, women make 27 cents less. And we can explain about 80 % of that gap, meaning 20 % we can't explain. It's either bias, unconscious and conscious bias, but we can't quite capture it in the data. Of the 80%, though, it comes from two sources.

14:24One third of the gap is different hours worked. So women have the majority of part-time jobs, minority of full-time jobs, and we're working fewer hours. So for every 10 years a man is spending in the workplace, women on average are spending 8.6 years. So we're missing kind of 1.4 years. And that's largely not a shock between maternity leaves, but also care leaves, right? We're taking care of parents, in-laws at higher rates also, kind of later in our careers typically. So there is a difference in terms of years of experience. That's one third of the explainable gap. The two thirds, though, is different occupational choices that we are each making.

15:01So we often start off at very similar occupations. And over time, we may trade off for less competition, we may trade off for more flexibility, we may trade off for jobs that are more aligned with our personal values and what we're excited about. And that drives two thirds of the pay gap. So if you do that knowingly, wonderful, right? But if you do that unknowingly, or the job market is acting in biased ways, then that's the challenge that we want to address. Huh. And so how do you address that? We address that in the book by talking about what are the decisions we can each make knowingly to make the best trade-offs for each of us, right?

15:40So if you want more flexibility, knowingly, go ahead and make that trade-off. But if you were making trade-offs unknowingly, and maybe kind of getting a lower income salary, then let's talk about what you can do to maximize that income. So early on in your career, there's a number of decisions that we each make that really set us on the right trajectory, right? They kind of increase the slope of that income curve. The biggest thing you can do to maximize what we call experience capital, which is kind of the wisdom, the knowledge you learn on the job, and it's how you leap over that broken rung, the biggest thing you can do is pick the right company.

16:15And the right company has a few characteristics. In the data, number one, they invest in your learning and development, right? So they expect ongoing growth and they invest in that, whether digital learning or other types. Two, they support cross-functional rotations. So you're not going to start in a role in HR or finance or any other group and end there 35 years later. You might start in HR, go over to finance, go over to the business, right? But you're rotating and you're growing and learning skills from lots of different groups and different perspectives over time. And that stretches you and builds what we call experience capital.

16:49And then third, the right company will have a very clear and effective strategy. So you can tell, you know, is it Netflix? How and how are they doing relative to competitors and innovating and financial results? And all three of those things, learning and development, cross-functional rotations and strategy effectiveness, you can tell outside in. You don't have to accept the offer and then find out a year or two later that you made the win. Yeah, and you can ask what they do in the interviews. Absolutely. Yeah, and I think of companies that talk about my friend Donna Morris at Walmart all the time.

17:18But, I mean, Walmart is a great example of this where they hire people entry level in the stores. They become store managers. They go to corporate. They have a very, very good program. And they have over 2 million associates around the world. Incredible. A small country. Yeah. Okay. So if I'm a woman and I'm starting out in the workforce, or maybe I've been in the workforce and I'm just starting to recognize some of these things, what do I do? Yeah, I would do besides the right company. Yeah. Besides pick the right company, I think there's the wrong company. Yeah. Well, if you pick the wrong company, I think it's never too late, especially if you're early on five, 10, even 15 years in to kind of remake that decision and pick the right company.

18:10It's often worth it. Now, you have fewer years to benefit from that decision and that growth. But typically, it's still worth it to kind of double back and make the right decision. But other things you can do, both early on and across a career, you can make big, bold moves. And in the book, we describe how do people jump jobs? When they switch jobs, what exactly happens? And we measured what we call skill distance. So when somebody takes a new job, kind of close to your heart, 25 % of the new skills in the next job are not skills that they used in the previous job. So think about 25 % new skills as kind of the average.

18:47Anything more than 25%, let's say 50%, 60%, you're moving from HR to finance or finance to generative AI. That would be what we call a bold move. 50%, let's say, of the skills you're using in this new job are new to you. You've never used them before. You're really uncomfortable. But if you can reframe that in a positive way of, I know I haven't done this before. Every day is a struggle. I'm out of my comfort zone. But this is one of the best things I can do to build my experience capital and stretch myself and grow my skills. That is correlated with 20 % higher income. And interestingly, in the research, women and men make roughly the same number of bold moves across a career.

19:29It's about 1.7 per decade, which doesn't sound like a lot, but it makes sense. They're kind of tiring the way I described them. You're in a role, yeah, for a bit of time, and then you make a bold move. Yeah. Okay, exactly. And then you've got to build the skills, cement them, make sure that they're kind of second nature before you build on that kind of foundation to take on your next bold move or jump. So, but we, we, but we make the same amount of bold moves as men. Women make the same number of bold moves as men on average. But when we make bold moves, when women make bold moves, we're much more likely to stay at the same income quintile or decrease in income quintile.

20:06Men are much more likely to increase in income quintile. So when they jump and they jump boldly, it's, you know, they're reaching for a big role, a big salary. When women jump, they may jump to something very, very different, like teaching into sales But they are more likely to decrease. And maybe they're optimizing or trading off for flexibility or other things. But the data says that we will more likely or more frequently than men decrease our income. Isn't that just shitty? But, okay. So I've always thought about it as another, and I don't know whether you came across this in your research, But I always thought some of this, like especially with bold moves or career changes, a lot of it might have to do with advocating for oneself.

20:56Like I think I always feel like men are like, yeah, you need to pay me, you know, whatever. You know, what about and women are like, oh, you know, I'll just whatever you think is good. That's fine. Did that come up in the research? It does. And it comes up in one of our chapters around bias. And there's lots of different types of bias, right? There's external bias. When you see me, what do you think? When I tell you I have three children, what do you think? But also, what have I internalized about the notions of women and family and women in career? And how I think about those concepts actually is very predictive of whether I would hire an equally skilled and talented woman as a man.

21:37And so there's lots of bias in hiring, as you know, well, in promotions and even performance conversations. And so that's a challenge. But it's a combination of both external bias and what people are kind of judging and performance evaluations, but also internal bias. Do I feel ready? Right? Am I reaching for that role? Am I asking for that bigger salary? And it was interesting in negotiations when women are negotiating on behalf of their team or their family or someone else, they negotiate equally effectively, frankly, if not more, right? But when we're negotiating on our own behalf, we don't do it as frequently.

22:11And when we do, we're about three times more likely to be perceived as selfish, pushy, bossy. And so part of it is what we advocate. And then the other part of it is how are we perceived both by men and women in terms of what we're actually negotiating for or advocating for? Yeah, I've been in that situation. Because there were, you know, I sort was like most of the time in my career like okay I'm just gonna take you know I'm gonna take what I get I'm not gonna really push and then there was a time that I did push and and I ended up getting most of what I wanted but I could tell that the person I was pushing it with um which was my boss at the time who was a man was not happy with me right like he was like annoyed and And, you know, I and then after that, I don't think I did it again.

23:12You know, it didn't feel great for you either. Right. Even though you achieved part of what you wanted to accomplish. Yeah. And I mean, like it was never brought up again or anything like that. But, you know, it was just I was trying to be bold and do what I advise people to do for themselves all the time. and it didn't backfire per se, but it also like - Didn't feel great. No. Yeah. And Jessica, it's interesting. We see that a lot in the data around motherhood. So around the world, this is one of the most persistent global things that pops up in the data. If you compare a woman with children to a woman without children, women with children are less likely to get the job, less likely to get promoted, less likely to get paid more.

23:57Meanwhile, the complete opposite is true for men, right? So had a man been in your situation in negotiating, they might have said, oh, he needs the salary to support his family. But meanwhile, they don't think the same of the woman who's supporting her children. But if you compare men with children to men without children, men with children are more likely to get the job, more likely to get promoted, and more likely to get paid more. And the effect goes up the more number of children that man has. And to your point, it's the rationale underneath is, oh, men with children are more stable, more trustworthy, and they need the salary to support their families, right?

24:31But meanwhile, we're not thinking the same ways, both men and women, about the mother supporting her family. And even three quarters of Americans here at home will say that fathers are more dedicated to their jobs than mothers. And so you can tell, right, as an HR leader, how that's going to play out in performance reviews, even subconsciously how that plays out in the workplace. It's just bizarre. Okay. Well, I mean, bizarre in the way that, yeah, of course. Yeah. You know? Okay. So men with children get ahead. So have babies, men. And women, no, just, no. But I did want to talk about the impact of being a mom.

25:15Yeah. Because I became a mother later in life and later in my career. And so I have a five-year-old today, which I think everybody that listens knows because I talk about him like all the time. But things changed when I had my baby. And I could tell that it changed in how my male colleagues, you know, looked at me. And then things changed for me from a priority perspective. Because before then, it was all about work all the time. and then when I had him I was like okay now I have to take care of this thing um this human that I created and I wanted to right like I I wanted to be there and I wanted to take care of him and I started to create more boundaries of like you know things I would do and I I remember um I think this is like COVID days, but he, my son was maybe right around one and COVID was lightening up for one of the first times it was lightening up.

26:22And my boss at the time was like, okay, we're going to get on. We're going to go to this country, this country. We're going, we'll be gone 11 nights. And, and I think he, he must've seen my face. Cause I was like 11 nights, like, you know, and he was like, well, what's wrong? and I was like I can't be gone 11 nights like maybe I can do four or five right like but 11 nights is like a long time um and he's like oh is this because of the baby yeah yeah it's because of the baby you know and he's like well you can bring him with you and I'm like no, I can't bring him with me. That's crazy. Anywho. So I mean, it just is like a really hard thing to navigate no matter.