Supply Chain Study Shows the Gender Pay Gap in the Field

January 13, 2015

supply chain pay gap ladders

This week, an article in PurchasingB2B (an excellent Canadian procurement publication) from a little while ago caught our eye. It featured some findings from a recent study that examined salary rates for men and women in the supply chain field in Canada. This article and the study it highlights are of particular interest to us for two reasons: one, we’re a female-owned company, and two, because we’ve written about a similar, related issue on a few occasions before: the lack of women in senior-level supply chain positions.

The study, titled “Sex and Salary: Does Size Matter? (A Survey of Supply Chain Managers)” was published in the journal Supply Chain Management, and had some interesting findings for those interested in the emerging picture of supply chain talent in 2015 and beyond.

As a starting point, the authors of the study looked at the top line statistic that male supply chain managers earn $14,296 more a year, on average, than female supply chain managers. They also provide some statistics about the gap between men and women in senior positions compared to junior positions. There are 10 men for every woman at the CEO/vice president/director level within supply chain. This is in comparison with 1.1 men for every woman at the purchasing agent/ buyer level. Dispiriting statistics, but they’re consistent with what we’ve known for a while.

But what makes the study interesting is how the authors go beyond typical reporting of the pay gap to try and come to an understanding of the statistics: what factors are at play? Why does the pay gap exist, and can it be better understood by breaking down the data? Is it possible to statistically isolate the extent to which discrimination plays a factor in the wage gap in supply chain?

The authors identify five factors behind compensation in general:

  • Position within an organization
  • Personal work-related characteristics (such as the individual’s experience and education as well as hours worked and job performance)
  • Differences among industries and the size of companies individuals work for
  • Differences in union membership
  • And finally, discrimination

They then used statistical analysis to account for the first four factors in the wage gap between men and women in supply chain management positions in an attempt to see whether non-discriminatory factors can account for why women tend to earn less. They tested a number of hypotheses about the first four factors that might explain the supply chain gender pay gap: whether women tend to work at smaller organizations (which tend to pay less), whether they tend to work fewer hours, etc. Ultimately, the statistics bore out that these factors are not behind the gender pay gap, which shows that discrimination in hiring and advancement is still a factor. As the study puts it, “after accounting for other factors, there remains a gender pay gap in salaries.”

Some further questions featured in the survey include: “What are the risks associated with workforce gender imbalance and compensation disparity?,” and “is the gender pay gap sustainable?”

The authors of the study made a key point, which is that, while supply chain has tons of room for improvement when it comes to gender equity in pay, the field is uniquely positioned to make up this gap: “SCM may be behind accounting and other business disciplines on gender issues generally, and the salary gap in particular. However, given its strong interest in workforce and supply base diversity, and the link between employee diversity and supplier diversity, SCM should lead the charge toward gender equity – and closing the salary gap.” 

We agree.

Here are some other key findings from the study:

  • The gap between men and women persisted whether the women surveyed were single, married or have children.
  • This isn’t related to the gender gap specifically, but the study found that managers who have a CPP (Certified Professional Purchaser) designation (recently changed to the SCMP designation) earn $75,433 on average, whereas supply chain managers who don’t have the designation earn $59,310 on average. That $16,120 gap goes to show you that professional designations are immensely powerful in propelling compensation to the next level.

Interesting stuff. And we’ll be sure to stay on this developing topic about the increased importance that women will have in the supply chain going forward, and whether the compensation gap is closing. Here is a link to the PurchasingB2B article, and here’s a link to the study itself.

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