When women set their own salaries, there's still a pay gap

The New York Times and Goldman Sachs (typical) engage in some victim-blaming with the results of a new study on a Goldman community-service program that advises entrepreneurs: Female small-business owners, who generally set their own salaries, pay themselves about 80 percent of what men in the same position do. Amazingly, this is almost the same as the unadjusted pay gap in the larger workforce between what full-time male and female workers earn.

The data come from a study Babson College did on 1,300 particpants in Goldman’s program, called “10,000 Small Businesses,” which aims to educate and help small-business owners. After the program, the gender gap shrank noticeably…

Men who went through the program gave themselves raises too — women just gave themselves even bigger raises. The study suggests two possible reasons: First, women learn from the program that paying themselves a reasonable salary makes sense as a financial decision, especially because it can demonstrate fiscal health to investors; second, from working with other small-business owners in the program, “participants have the opportunity to learn about the ‘going rate’ for their own salaries and develop the confidence to value their own time.” Both of these things may happen to male 10,000 Business graduates too, but Goldman and Babson think learning these things has a greater impact on women’s behavior.