This Gender Pay Gap Is Being Replaced by a Different Gap - OZY | A Modern Media Company

WHY YOU SHOULD CARE

Negotiating a salary can be harder alone.

By Carly Stern

Keina Newell makes a living by helping others people gain confidence managing money. The 34-year-old Washington, D.C., resident works as a freelance financial coach, specifically for professional women. 

As someone who works alone, she understands the challenges of knowing where to set her rates. “In the beginning, I had to move beyond my own money mindset of ‘I just need to replace my salary, so I do not need to charge that much’ or ‘making more money means I’m greedy,’” Newell says.

It’s an experience that an increasing number of Americans must navigate as the freelance workforce grows. An estimated 56.7 million Americans now work as freelancers — a boost of 3.7 million over five years, according to a 2018 report by the Freelancers Union and Upwork. Meanwhile, the pay gap between male and female freelancers in the creative economy has appeared to shrink: It narrowed from 32 percent in 2017 to 11 percent in 2019. Female creatives earned on average roughly $51,900 in 2019 while men earned $57,700, compared to $30,700 and $45,400 in 2017, respectively. But that statistic masks a different shift.

Female freelancers complete 22 percent more projects a year than their male counterparts.

That’s according to the 2019 Gender Pay Gap Report conducted by HoneyBook, a financial management platform for freelancers. HoneyBook surveyed roughly 1,800 North American freelancers and analyzed nearly 345,600 invoices over the course of one year. The data showed that female freelancers across creative industries earned 26 percent less per project than male freelancers — so to offset that pricing structure, they took on additional projects. “The bottom line is, even in a space where women can charge whatever they want, they still charge less,” says Natalie Franke, head of community at HoneyBook and co-founder of the Rising Tide Society, which produces online materials and organizes community events for freelancers.

There’s been scant research focused specifically on the creative economy. HoneyBook conducted an initial report in 2017 that focused exclusively on pay disparities among self-employed creative professionals. One of the most interesting findings? Survey respondents had a perception that pay gaps didn’t exist within the freelance economy.

It’s a perception that can be reinforced by working in isolation. Freelance workers can face unique barriers when it comes to lack of pay transparency compared to traditional workers. For one, they don’t have a human resources department or colleagues they can seek out for salary insights or support.

There’s no universal platform to gain insight into fair freelance rates across industries, geography and experience levels. Industry-specific sites, like “Who Pays Writers” — where writers anonymously report what various publications pay them, to help freelance writers set rates — have cropped up as patchwork tools, in addition to anonymously circulating Google Docs. These types of anonymous peer resources are extra critical given that revenue for freelancers more directly comes down to individual transactions between workers and clients. The HoneyBook report found that women are less likely to lower asking prices after negotiating with clients. This is because women have less wiggle room after undervaluing their services initially, says Franke. “If women don’t charge market rates, they have to work harder to generate the same amount of revenue.” 

The way Newell sees it, freelancers can’t be deterred by fear of pushback from prospective clients. Instead, they should approach their services like a premium offering and accept that they can’t market it to everyone. “I hear objections to my pricing almost daily,” says Newell. “As a coach and freelancer, it’s my job to be confident in my pricing and not see someone else’s objection as an indicator that I should lower my prices.”

High angle view of young woman writing notes

Data show that female freelancers across creative industries earned 35 percent less per project than male freelancers — so to offset that pricing structure, they took on additional projects.

Source Getty Images

Learning to brush off objections can become easier as these conversations become less taboo — but workers must be aware that a gap exists, and be connected with other freelancers, to make that possible in the first place. The Freelancers Union, which is free to join, now represents more than 490,000 independent workers of all types. It hosts monthly meetups to build community, while Rising Tide facilitates bonding via online webinars and in-person events. Then there are independent unions by industry, like the Industrial Workers of the World Freelance Journalists Union.

In recent years, public attention has intensified on high-profile cases of economic inequity within salaried industries — from professional women’s soccer to U.S. corporations to medicine — as those gaps have become better documented. As the freelance gap begins to generate attention, it’s raising similar questions: Are female freelancers making less per project because their clients refuse their higher prices, or because women have been socialized not to demand them? 

That age-old “just ask” logic isn’t likely to be the silver bullet: It’s proven to be flawed for traditional salaried industries, as research shows women ask for promotions and raises as often as men, but don’t receive them at the same rates. Regardless, the need for solutions tailored to the freelance economy will only get more pressing as workforces increasingly go independent. The share of full-time freelancers grew from 17 percent in 2014 to 28 percent in 2019, according to the research from the Freelancers Union and Upwork — meaning that this particular gender pay gap is now relevant to nearly 1 in 3 Americans.

Correction: A previous version of the story stated that female freelancers completed 17 percent more projects a year and earned 35 percent less than male freelancers due to typographical errors in the original report. 

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