Men Should Make Less

(...Then they currently are, but equal to ~~women~~ all other humans in the long run)

The title of this is a little vague and needs clarity, but "Men, on average, over time, consider as a single cohort, regardless of age, should make less than they currently are, not adjusting for inflation" is a little long winded. I really wanted to call it "How Soon Is Now? Equal Pay," but that is a lot less clickbait worthy.

Also, to clear the air, this is not a man hating feminist treatise. Nor is it a cringe worthy mansplaining manifesto. It is really just a mathematical model to explain how things work, so if you find yourself cornered at a party, talking to someone convinced life is getting harder for men, you can promptly slap them in the face with math.

The Basic Model

What if I told you that even if institutional racism and sexism ended tomorrow, the effects would still be felt for over 40 years? Before diving into a model that applies to companies, let's first start with an analogous example of desegregating a university.

Let's take a four year school that is all male and decides it is going to allow female students. Further, it decided that each new class should be evenly split. So in the first year, ¼ of the students graduated and are replaced by freshmen. Since half the freshmen will be women, ⅛ (half of ¼ of the school will be women. The next year, another group of men will graduate and half of the incoming students will be women, doubling our ⅛ to ¼. Following this trend, the school will go from 0, to ⅛, to ¼, to ⅜ to ½ women before reach a steady state (or 0%, to 12.5% to 25% to 37.5% to 50%).

So, perhaps unsurprisingly, it takes 4 years for the school to be fully integrated.

The Model for the Workforce

For this thought experiment I am going to make a very simplified example of how “society” works:

Equality means equal economic opportunity.
People work for 40 years and continually stay in the workforce. After 40 years, they retire.
Each year new workers are hired to replace the old.
Tenure in job is directly correlated to pay
Before time 0, the societal institutions are 100% biased and homogeneous (i.e. 100% white men).
At time 0, the institution becomes completely fair and hires staff that is reflective of the demographics of the country.

We will definitely need to revisit the validity of these assumptions later. Let's further assume, for simplicity, each year 100 people are hired and 100 people retire, implying the company is 4,000 people in total.

For our first example, let's look at the impact of gender once the institution is fair. Not surprisingly, women increase by 50 each year as 100 men retire and only 50 new men are hired, taking 40 years to reach equality. And no woman has even retired yet!

Revisiting Assumptions

Now let's revisit our assumptions:

Equality means equal economic opportunity.
- Probably over simplistic. One should not over extrapolate this hiring tenure model.
People work for 40 years and continually stay in the workforce. After 40 years, they retire.
- For some companies and industries this may be fair. However, for budding new industries like tech start ups and apps this doesn't make sense. The company doesn't have a tenure workforce waiting to retire and generally hires younger fresher faces. If anything, places life Silicon Valley should be "more equal" than older companies! (Spoiler, it's not...)
Each year new workers are hired to replace the old.
- Fair enough.
Tenure in job is directly correlated to pay.
- Ooo! We didn't hit on this very much
Before time 0, the societal institutions are 100% biased and homogeneous (i.e. 100% white men).
- Fair enough
At time 0, the institution becomes completely fair and hires staff that is reflective of the demographics of the country.
- Fair enough. We can't make this model too complex.

So let's revisit the two items above, company length and pay

Startups and Retirement Timeframe

For company length, we also did not assume any growth. Let's take a 10 person tech start up that grows at 40%. We can assume we start with all men. So year 1, they hire 4 people (10*.4) and half are women. Great, now we have 12:2 men to women. We will repeat this process of growing 40% a year and hiring a diverse staff.

Looking at the graph, we see startups have a much easier time reaching equality if they want to! 40% female in 5 years. However, there is another quirk. Since presumably no one is retiring, it still takes 41 years to get to the balanced mix. Until the initial cohort that was not balanced by gender retires, the company will remain unbalanced. Also our company is over 12 million people in 41 years based on this growth assumption...

A Mathematical Pay Gap

Tackling the pay, we need to make some more assumptions. Let's assume people make on average $50K their first year and get a 3% raise a year. Thus tenure 40 people make $158K. So what is the average pay gap?

Starting off, the average salary is $94K. Now the first year the average pay for women will be 50K because they are all new hires. Men will actually see a slight increase in average pay because they no longer have as many junior members. However, it is important to note the total amount of money going to men has decreased and the amount to woman has increased (from zero...).

Now in year 2, women will now make an average of $50,750. Half are making $50,000 starting fresh and the first cohort is now making 3% more ($51,500). Again we see that men's average salary increases.

There are a few things to call out on the graph. Notice how the pay gap gets a lot worse before it gets better. This is an unsettling conclusion.

Also, look at the average man's salary in year 26. This is the first time average wages for men has decreased. Ever. And after this slow decrease for a few years, the salary ultimately plummets to equality (irony intended).

Of course we know that salaries in this scenario are entirely tenure (proxy for merit) based. By definition, we made all salaries fair. This is not to say women should make less or that our current pay gap is entirely due to this effect. This is saying that we should expect to see a decrease in the average salaries for men and that is okay.

If the model doesn't quite click with you, consider this thought experiment:

The median CEO of a fortune 500 company is ~$10 Million.
- So the group makes 500 x $10million, or 5 billion dollar
If women made up 50% of this group, instead of 5% they currently do, that is over 2 billion dollars women should be making

Final Thoughts on Men Making Less

So what is our conclusion?

Don't expect things to change overnight. The lag is painfully slow for change.
Start ups and young companies should be pioneering the way in equality.
The pay gap will sadly get a lot worse before it gets better.

What can we do to speed up the process?

Treat people fairly and hire based on merit.
Consider if people from different fields with experience can fill your job opening.
- Can a Head Nurse who managed RNs in the ER for 10 years manage a sales force for an insurance company? I think they might be able to handle the stress.

This model is very theoretical and different companies and industries are at different points. And hopefully it goes without saying roles can be reversed. We could talk about men entering the nursing profession. Or we could talk about women in basically any STEM field.

So try to do your best in hiring and working for an ethical employer. And say something if you see injustice.

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