The Master of Business Administration (MBA) degree is well known for its salary-boosting potential, with the financial benefits a draw for many who earn the degree. However, how much does an MBA help women close the gender pay gap? The following article explores this pay gap and how an MBA, like Southeastern Oklahoma State University’s online MBA with a Concentration in Leadership program, supports students’ efforts to earn more equitable salaries and close the pay gap entirely.
What Is the Gender Pay Gap?
The gender pay gap is the difference in salaries that men and women receive. In the 2024 Gender Pay Gap Report, Payscale notes the distinction between an uncontrolled gender pay gap and a controlled one.
The uncontrolled gender pay gap pertains to the ratio of the median income of all women to that of all men, with women earning $0.83 for every $1 men earn. The controlled pay gap is based on men and women with matching job titles and years of experience, with women earning $0.99 for every $1 men earn. Regarding the $0.99 controlled pay gap figure, the Payscale report notes that “even when women are doing the same jobs, the gender pay gap is not zero. It should be zero.”
What Are the Reasons for the Gender Pay Gap?
Many factors contribute to the gender pay gap. Research from the Institute for Women’s Policy Research (IWPR) shows that there is little progress in the gender integration of jobs. Thus, jobs predominantly done by women pay less, on average, than ones typically held by men. The segregation in certain occupations contributes to the wage gap.
The Payscale report also found evidence of gender discrimination in the workplace. This behavior leads to women being undervalued for their work and held in lower-paying jobs without a chance for promotion. Employers may also disregard a woman’s education as opposed to a man’s when determining pay.
Moreover, women may be penalized for taking family leave or exiting the workforce to raise children. Both actions can make it less likely for women to continue an upward path in their careers and earn a higher salary.
Does an MBA Close the Gender Pay Gap?
An MBA does not always solve the pay gap problem. While it’s typical for MBA graduates to see a pay boost, men with an MBA make 20% more than women with the same degree. This gap expands further with nine or more years of work experience, notes Zippia.
The Forté Foundation discovered that women receive, on average, a 63% boost in pay after graduating with an MBA. Nevertheless, men continue to make more money even though both genders might hold the same qualifications and meet all the requirements for a position.
First introduced in 1997, the Paycheck Fairness Act has still not received approval from Congress. If the legislation passes, it will address the loopholes in the Equal Pay Act of 1963 and allow women to combat pay discrimination. It will also prohibit employers from using salary history and protect employees from retaliation for sharing salary information. Most importantly, employers can take steps to close the gap for women by paying them a fair salary.
Through Southeastern’s online MBA in Leadership program, students gain the degree and the skills to pursue higher-paying opportunities. With this education and knowledge, graduates can also work to encourage more equitable leadership, foster organizational cultures that support gender equity, and reduce the pay gap to benefit the future of women in the workforce. Courses like the Team Development Behaviors course particularly focus on what it takes to foster teams that are inclusive and cohesive.
Learn more about Southeastern Oklahoma State University’s online MBA with a Concentration in Leadership program.