What does half a mil buy these days? A three-bedroom house in New Jersey, college tuition for a couple of kids in a couple of decades, peace of mind in the 401(k). All things a working woman could use.
And yet, working women are routinely tossing $560,000 away. We’re doing so by not uttering one all-important sentence during one all-important event. Upon being hired for our first jobs, we’re not saying: “Now, can we negotiate my salary?”
The price we pay over the course of our careers by not negotiating our starting salaries: $560,000.
A study of master’s-degree candidates at Carnegie Mellon University by economist Linda Babcock found that only 7 percent of first-job-seeking women negotiated their salary, as opposed to 57 percent of men. There was no small consequence to this failure to negotiate. In their book Women Don’t Ask: Negotiation and the Gender Divide (Princeton University Press, 2003), Babcock and co-author Sara Laschever found that candidates who negotiated increased their starting salaries by 7.4 percent (about $4,000), and that the starting salaries of males averaged 7.6 percent higher than the females’.
Babcock calculated that failing to negotiate for a first salary can lead to an overall loss of over $560,000 by age 60. That comprises a good chunk of the estimated overall wage gap between men and women–further exacerbated by such other forms of gender discrimination as mommy tracking and sexual harassment–which Brandeis University Women’s Studies Research Center resident scholar Evelyn Murphy projects (using U.S. Census figures) costs women between $700,000 and $2 million over the course of a career.
So buck up and ask. That three-bedroom house is at stake.