Is It Time to Give Yourself a Raise?Rieva Lesonsky
I remember back in the ‘70s reading in Ms. Magazine that employed women made something like 70 cents for every dollar earned by a man. The gender wage gap has closed up a bit (not entirely) in the intervening decades. So if women aren’t making enough at their jobs, isn’t the solution to start their own business? Women business owners can pay themselves whatever they want.
Not so fast. According to Fortune, a study of entrepreneurs running social enterprises found women business owners pay themselves, on average, 23 percent less than their male counterparts with similar businesses. In other words, even when women are in charge of their own salaries, they still pay themselves less than men do.
Although the women business owners in the study are making less than the men, they report higher satisfaction with their businesses. Another study that polled self-employed men and women about their attitudes toward money found that men rate salary more important than women do, while women business owners rate “making a contribution to society” more important than men do.
It’s all well and good that women business owners enjoy contributing to society and get pleasure from their businesses for their own sake. But that doesn’t mean we don’t deserve to pay ourselves as much as men do.
I can think of a few reasons women business owners might pay themselves less—none of them good. If you’re a working mom, you may be so relieved to have some control over your own schedule as an entrepreneur that a lower salary seems a fair tradeoff. Or perhaps you just don’t value your time or expertise highly enough
Keep in mind, we’re not talking about a man who runs a $1 million tech company paying himself more than a woman with a part-time home-based business. We’re talking about equivalent men and women entrepreneurs paying themselves drastically different salaries.
Think you might be due for a raise? If you’re not sure, do some research on average CEO salaries in businesses like yours. Your trade association or the many salary websites out there will have information.
The economy is improving, so if, like many entrepreneurs, you haven’t raised prices for a few years, now could be the time to do so. Use some of the additional profit to increase your salary.
Still feel leery about paying yourself a decent salary? Think of it this way: Would you pay male and female employees in the same job a different wage? I’m pretty sure I know what the answer is.
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Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at email@example.com, follow her on Google+ and Twitter.com/Rieva, and visit her website, SmallBizDaily.com, to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.