Mind the wage gap

Despite an increase in their numbers, female MBA grads still are settling for lower pay.


Photo: Thomas Fricke

When Nikki McNaughton completed her MBA at the University of Manitoba’s Asper School of Business earlier this year, she didn’t expect to have trouble finding work. McNaughton excelled in her studies, had one of the highest GPAs in her class and won accolades at international competitions. She also had an undergraduate education in both psychology and science. But so far, McNaughton has struggled to find the right job. “I was patient at first, but now I’m getting a little bit frustrated,” she says.

The numbers show McNaughton isn’t alone in her dissatisfaction with life after an MBA. The schools in this year’s Canadian Business MBA roundup generally show similar or increased numbers of female students compared to last year. Similarly, a record number of women in the U.S. entered business programs this fall. But recent research from the University of Chicago suggests that, for all the gains women have made in the pursuit of higher business education, they’re still settling for less. The Chicago study tracked factors like GPA and job experience to show there was still a modest wage gap between the genders for recent MBA grads, and worse, over a period of 15 years, that salary disparity increased to 40%. It also suggests the salary gap has to do with lifestyle decisions made by women—specifically childbirth.

Elissa Sangster, executive director of the Forté Foundation, a Texas-based not-for-profit consortium of large companies and business schools, agrees lifestyle may be a determining factor, but doesn’t necessarily see that as a problem. “Women make choices about their career paths—they decide if they want to be an executive vice-president, start their own business, or be the head of a not-for-profit, and those choices mean certain things about their pay and their lifestyle,” she says, pointing out that the gender wage gap is much smaller with an MBA than without. “Their aims might not always be the same as men’s.”

Helen Harper completed her part-time MBA at Wilfrid Laurier University in 2010 and works in the male-dominated mining industry, responsible for sourcing, purchasing and recycling copper and other precious metals for Xstrata Copper. She agrees that choice plays a key role in salary disparity. “While salary is an important factor, many other factors drove my decision to take on a new role—the people who I would be working with and for, the nature of the role itself, and the company as a whole were also very important factors in my decision.” But while Harper acknowledges gender may be a factor in some situations, she says at Xstrata there are a surprising number of women in leadership positions, and she has never felt held back by her gender, at school or in her field. “I would say my type of role was determined more by the skills, strengths and needs of the group rather than someone’s particular sex,” she says.

Beatrix Dart, associate dean of the Rotman School of Management in Toronto and executive director of the school’s Initiative for Women in Business, says women may be earning less and failing to rise to their full potential for more stereotypical reasons. “I recently did a quick poll of the first-year female MBA students here, and I asked them, ‘How many of you in your study groups have volunteered to be the note taker?’ The revealing part was, it was the overwhelming majority,” she says. And when Dart asked the same students who had taken on the role of the presenter, or taken control of the process at the whiteboard, the number was reversed. “I pointed out to them what kind of stereotyping they are perpetuating. That women are in the nurturing role, the helping role, instead of taking charge.”

Even McNaughton acknowledges that her own ambitions and interests have taken priority over landing the top job with the best pay. “I’ve applied for some jobs that I didn’t get, but there are also some I haven’t wanted. I’m being a bit picky—I didn’t want to jump on the first train that rolled in,” she says. She knows she needs experience, but isn’t worried about her future. “I have a passion for startups and new ventures. I am pretty certain that someday I’ll own my own business.”