According to PayPal’s US Freelancer Insights Report, two-thirds of US freelancers are female. Yet, according to a recent report by HoneyBook that looked at over 200,000 of their invoices, a huge pay gap exists between men and women. How much of a gap?
On average, HoneyBook found that women are making 32 percent less than men for the same exact job in the creative economy. That’s despite 80 percent having college and graduate degrees and performing similar work.
And while we’re probably all familiar with the wage gap in the traditional 9-to-5 salaried world, it’s disheartening to see this disparity playing out in the gig-economy where individuals are technically setting their own rates and fees. Especially since freelancing may be the future of employment as more and more young Americans (and people all across the globe) are working for themselves.
Why are female freelancers underpaid?
Figuring out why this pay gap exists is a complex issue, but there are some clear insights from the data. HoneyBook came to this conclusion at the end of their report:
Of respondents who are aware that there is pay gap, the majority pointed to negotiating power as the reason the gender pay gap persists, but according to the data, prices aren’t being negotiated. That means female creatives are already charging too little for their services. Simply stated: female creative entrepreneurs need to charge more to begin closing the gender pay gap.
A few things to take away from this. First being that this implies that many respondents were unaware of the pay gap that exists among freelancers. In fact, 63% surveyed believed that this pay gap didn’t exist.
So education, or putting a spotlight on the issue, is a key step the industry as a whole needs to take. Women need to realize they are undercharging, and men need to realize that they are being paid more than their female peers.
Furthermore, if women are unwilling to negotiate for higher rates, as HoneyBook states, then education in this specific area is needed; education on why and how to negotiate. If the freelancer culture makes it hard for women to be assertive, then that’s something that can be addressed head on.
Anecdotal evidence of why this happens.
We contacted two women who freelance and presented them with the fact of the gender pay gap. This is what they had to say about their own experiences:
I’ve been a freelance editor and manuscript reviewer off and on for twenty years. I’ve always found it tricky coming up with my rates on my own. A couple things happened to me just a few years ago that made me rethink my prices. One, my daughter (in a bout of honesty before leaving the country with the Peace Corps!) flat out told me I wasn’t charging enough for what I did. Then, I was talking to a guy friend of mine who was also freelancing in my industry. I told him I was getting push back for charging my rate, and when I told him what my rate was, he was aghast; he was charging twice as much for the same work!
I think this idea of “not pushing back” comes on early for women. I have three daughters and my husband and I have had many babysitters over the years. When we ask them “what do you charge?” across the board, the female babysitters say “whatever you think is right,” while the male babysitters always had a number. Their rate wasn’t unreasonable or anything, but it was very noticeable that every guy had a rate in mind while every girl didn’t.
I was brought up in sort of a suppressive culture for women. I always felt uncomfortable asking for stuff I wanted or needed, and I didn’t get that much support for my abilities. I think that led to not understanding my value. It was different for men. They were more supported to go out there and it was ok for them to be angry and ask for what they wanted. It seemed guys would get jobs easier. For women, life seemed more about pleasing other people rather than putting yourself first.
I do freelance graphic design work and I do feel like I should be charging more. I’m confident in my abilities, but it’s such a psychological thing to actually charge more. You do need support from peers to actually do it and ask for it. So my rates haven’t changed much, because I put my relationship with my clients first, and that keeps putting me in this cycle of not charging enough.
Practical advice in closing the gender wage gap.
As discussed previously, the first step is knowing that there is a gap in the first place. It may be a no-brainer to some people, but the numbers above show that the majority of freelancers are simply unaware. So talk to each other about it, men and women. While the topic of money and freelancing rates are often difficult to discuss, the more the freelance industry can be open about this, the faster the gap will close. Need some more data to fire you up about it? Take this stat from HoneyBook’s analysis:
That’s just nuts.
Next, for female freelancers, know your value in two different, but equally important ways: 1) literally know your value in monetary terms. Find out what male peers are making by asking around and researching on online boards where freelancers list their rates; 2) metaphorically know your value in the sense that you absolutely do deserve to be compensated fairly for the work that you are doing, just as much as a male freelancer would command.
Kym had this to say on getting over the psychological hurdle:
I didn’t want to charge more, but I should have charged more. I wasn’t really afraid of losing clients, I was more afraid of the negative reaction they might have even if they agreed. Maybe it’s that whole female thing of taking care of people’s emotions and worrying about relationships. We’re not supposed to be pushy. See, women get labeled pushy while men are called assertive. My advice is to do more research on what others charge. And ask men! Don’t just ask women. Ask many different people, even in different cities.
Finally, doing the hard part of bringing yourself to the negotiating table is the crux of fixing this issue. Clients won’t give female freelancers (or male freelancers for that matter) higher rates unless you actually ask. Yes, some onus is on the employers (male or female) to be aware of any disparity when working with freelancers, but for most businesses they may only have one freelancer; meaning, the employer may not have context between male and female pay rates. The responsibility ultimately falls to the freelancer to ask.
Lauren gave this advice:
Be practical about it. Set emotions aside. Also, see if you can come to a point in your career where you don’t need to charge hourly anymore. Charging a flat rate can often get you to where you want to be, faster. Consider your expenses and work out what you need, and start there when you’re negotiating.
Did you know about the gender pay gap among freelancers? We’d love to hear your stories or take on this matter. Sound off in the comments below.