Gen Z is making pay transparency more common, and now some states are creating laws to require it.
How much do you make?
Some people have no problem answering the question, but others aren’t comfortable sharing that information.
For years, talking about your salary has been seen as an off-limits question. But as younger workers look to take more power over their work experience, many are now more open about what they earn.
Survey data from the consumer financial services company Bankrate found that 40% of millennial workers and 42% of Gen Z workers have shared salary information with coworkers or professional contacts. Those rates are considerably higher than the ones they saw for Gen X and baby boomer workers.
According to Bankrate analyst Sarah Foster, economic crises like the Great Recession of 2008 and the COVID-19 pandemic play a role.
“I think they really have learned that their pay opportunities have been significantly dented, so they have a little bit more of an incentive to talk about pay with other people who they work with,” Foster said.
As companies build their own diversity, equity and inclusion efforts, pay transparency and equity are playing a role in that.
The traditional pay structure can often leave workers of color behind. For example, 2020 data from compensation software company PayScale found that for every dollar paid to White men, Black men earn 88 cents, and Black women earn 76 cents. Even when you adjust for education and experience levels, Black men and women still trail slightly behind White men.
Pay equity advocates hope that making salary discussions more open and including a salary range in job postings will help close the gap and put all workers on a more level playing field when salary comes up in the hiring process.
“When you think about what it’s like to interview for a position, and maybe a recruiter will ask you what kind of number you’re looking for as soon as you throw out a number, that essentially becomes your ceiling,” Foster said. “So it’s something that’s very, very important to think about. And if you learn from other people in a certain position, if you learn from coworkers, you might work in the position that maybe you’re applying for or maybe a position you’re already in. You have something that’s tangible to base your ask on.”
This even translates into policy. Last year, Colorado was the first state to require employers to post salary ranges for jobs.
But, there’s also been some pushback. In the aftermath of Colorado’s law, companies including Nike, Oracle and Johnson & Johnson put disclaimers on their remote work jobs saying that they would not consider remote workers based in Colorado.
Nevertheless, states and cities are still pushing forward with pay transparency laws. In 2022, Washington state and New York City have joined them as the next two jurisdictions to put similar requirements in place, and California is one of several other states considering a similar law.
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