Money talks. Do organizations' DEI initiatives close the wage gap between gender?

Abstract

The wage gap between male and female pay is a persistent phenomena policy makers have tried to close for over 40 years. Despite the implementation of (national) policies, legislations and other initiatives, the gender wage gap has remained resilient. On organizational level, Diversity, Equity and Inclusion policies and/or initiatives (DEI) have been implemented to create a more equal working environment. However, researchers don’t agree on the effects of these policies. They debate whether DEI policies contribute to a more equal workplace or if they highlight and enlarge the differences between gender. Therefore, the goal of this research was to gain more insights in DEI policies/initiatives and to clarify its effects on the gender wage gap. To do so, we used the European Workforce Survey data (EWFS) from 2018 to test our hypotheses (N=2185). The regression analyses results show that, as expected, we found a wage gap present between the male and female respondents of the EWFS. Next to that, we found that one out of the six tested DEI initiatives/policies has a significant positive effect on the gender wage gap. The other five tested DEI initiatives/policies show no significant effect, meaning they don’t influence the gender wage gap. Based on the results we make recommendations for future research, and we mention our policy advice.