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Check the cubicle next to you

Who you work with just might matter to your bottom line. If you’re a manager, your coworkers’ gender and age can negatively impact your pay, a new study finds. — By Jon Bonne
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Who you work with just might matter, at least when it comes to your paycheck. Regardless of their gender, managers who work with more women, or whose bosses are women, face less pay than those who work with more men, according to a new study. And some may be paid less depending on the age of their subordinates.

Studies have documented pay gaps for more than a decade, with women earning less than men. This time, researchers at Columbia University and Arizona State University focused on who people worked with and whether it made a difference.

They surveyed over 2,100 managers across a broad range of fields about their pay and their coworkers — peers, subordinates and bosses. The more women in a manager’s immediate workplace, they found, the lower their pay — regardless of whether the employee was a man or a woman. Managers’ pay also dropped the farther their employees’ ages strayed from a median of 40.

“That indicates that the gender and age of everyone you work with will affect you directly,” said Cheri Ostroff, a professor of psychology and education at Columbia University Teachers College, who co-authored the study. “That’s an important implication when you think about jobs and career and your career path.”

Having more women as office coequals or as a boss could lower pay, but the greatest impact was seen in employees who managed women. A manager whose subordinates were 50 percent female could expect to get over $2,000 less in annual pay; if someone’s staff was 80 percent female, pay was some $7,000 less per year.

40 as a magic number
As for age, a manager could expect less money if his or her employees were significantly younger or older than 40. Someone managing 30-year-olds, or 50-year-olds, might get $4,000 less than someone managing 40-year-olds. With employees who averaged five years older or younger — 25 or 55 — a manager could expect to receive some $8,000 less.

For that matter, if your boss was just 25, you could be earning an estimated $13,000 less than someone whose boss was over 40, according to the study, published in the August issue of the Journal of Applied Psychology. And if your coworkers were younger than 40, you likely were making less than if they were over 40.

Moreover, they found, those impacts on salaries often can be cumulative. “You could really be in a bad situation if you’re a woman, most of your subordinates and peers are women and they happen to be older,” said Ostroff.

Trying to understand why
While the stark correlation between gender and pay surprised the researchers, they found the causes difficult to parse.

Some of the findings mirror conventional office wisdom, especially in regard to age, according to Ostroff. Younger workers are often considered less experienced, or are lower on the corporate ladder, which may reflect on their managers. At the same time, managers of older workers may lose prestige in their own careers because management often assumes older subordinates who haven’t been promoted are under-performers.

As for gender, discrimination may be partly to blame, but Ostroff suggested two other possibilities. In certain companies, some career paths attract, or “channel,” more women into departments with less prestige. Thus, even if a company is gender-balanced overall, departments with more women may be perceived to have less strategic value. But those departments may also be appealing to female employees because more women already work there.

Alternately, Ostroff suggests, women may be drawn to these lower-status jobs on their own, perhaps because it affords more time for family or more schedule flexibility. Such jobs often come with lower salaries.

Wanting the fast track?
At the same time, some managers believe women will seek out flexible schedules and thus may channel them toward those jobs, even if they would prefer a more demanding, higher-paying position. “I think it’s important that we untangle this to find out why it’s occurring,” says Ostroff.

Her findings on gender largely echoed those found by Mercer Human Resource Consulting in its work with clients on workplace diversity. Mercer principal Haig Nalbantian found that even when some companies put steps in place to improve overall diversity, women often still ended up in jobs that had fewer options for career growth.

“We tried to identify high- and low-potential jobs ... and then ask the question, ‘Is a job more likely to be low potential if it has a high percentage of women?’” said Nalbantian, an economist by training. “And indeed, we did find that to be the case.”

Nalbantian too is unsure how much channeling is involuntary, and points out that for at least one firm he studied, some of the most high-profile jobs were those that required extraordinary time and workload, which dissuaded female candidates looking for work-life balance; at the same time, the belief that most women wanted that balance at times dissuaded managers from choosing them for fast-track jobs.

Tricky to fix
Even if the causes become clear, fixing the disparity may be a challenge. In the simplest fix, companies may need to change elements of certain jobs — like extremely long hours — that keep some women from seeking them. Firms may also need to break managers’ habits of placing a certain type of candidate into a position based on the type of job they believe a candidate wants.

But, he warns, diversity and gender parity can’t be measured just by numbers, and companies need to get workers onto career tracks that will be successful for the firm and satisfying to the employee. For that matter, companies need to explore their career “dynamics”: How employees move up the chain, and how career paths are laid out as options.

“They have to make sure that people are sorting into the right areas and that they get the right people into the higher potential jobs,” he says. “The question is: Do you have a pattern where only some people are getting into the high potential jobs, and some are getting into the low potential jobs, and it’s not the right mix?”

Complicating the problem is the tendency for certain jobs to attract applicants of certain genders and ages, and a well-documented tendency for women to enter professions — often low-level service professions — that pay less and have a dimmer path for promotion.

To counter that, Ostroff and co-author Leanne Atwater surveyed 512 companies across a broad range of industries, and tried to compare both male and female managers in specific fields to weed out the possibility that a manager’s own gender could prompt the disparity. Even with those controls, the coworker pay gaps remained.

They also reviewed managers’ productivity and job evaluations, and found male and female managers getting equally good marks regardless of pay. That boosted their speculation that companies were channeling managers based on gender.

“Women are performing equally well in their given jobs,” Ostroff says, “but that job may not be as powerful or have as many responsibilities or as much authority.”