Getting the Short End of the Stick: Racial Bias in Salary Negotiations

Enjoyed lending an editorial hand on this one:

MIT Sloan Management Review, June 15, 2016

by Morela Hernandez and Derek R. Avery


Gender and racial inequality in pay is making headlines these days, and many companies are moving to eradicate it. One major and often unrecognized obstacle companies face is a less-than-robust understanding of the role of the salary negotiation process and the biases and behaviors of job seekers — as well as the people responsible for hiring them — in the problem. This may be a function of the taboos associated with offering prescriptive advice by gender and race. Nevertheless, decades of social psychological research demonstrate that these differences can play a key role in producing pay inequality.

Consider gender: There is a substantial and significant body of research examining how gender differences influence negotiation strategies and outcomes, how they stem from conformity with social roles, and how they depend, to some extent, on context. Specifically, researchers consistently find that women tend to negotiate lower salaries than men because of gender-specific role expectations. Women are expected to value the relational aspects of employment over more instrumental exchanges. Therefore, they can be more sensitive than men about being perceived as pushy or aggressive, and end up with lower pay.

In the case of race, markedly less is known. There is relatively little research examining its influence on negotiation. And scholars have focused more on discriminatory behaviors minorities must contend with in employment processes, rather than the role they themselves play in those processes.

We do know that a Black-White salary gap exists, and that researchers have attributed it to factors such as social network differences, salary expectations, and risk aversion due to different perceptions of economic insecurity. In our own research, we have found that the context of the job negotiation itself is partly responsible for the salary gap. That is, because of the distinctive race-related psychological features that influence people’s expectations, a Black job seeker can face unique challenges...read the rest here