How to Narrow the Gender Pay Gap in Side Hustles and Freelancing

Few people realize just how big the pay divide is. And what can be done.

Society has made slow but steady inroads into narrowing the wage gap between men and women in the corporate world. You can see that with the explosion in diversity, equity, and inclusion (DE&I) initiatives that seek to tackle representation and equality in a more systematic manner.

There’s some way to go. But there’s progress.

What isn’t discussed as much is the imbalances within the world of freelancing. This is a space that’s meant to promise greater freedom and autonomy. Yet, women still find themselves falling short in terms of rewards.

Let’s start with the data before, hopefully, some solutions.

A study by ZenBusiness, a Texas-based business administration service, provided some sobering insights. The research, based on inputs from almost 6,000 US-based freelancers, found that the average male freelancer would typically charge 48% more per hour than his female equivalent.

The gap was widest in the “admin, information technology and customers services” category when looking at the six most common freelance industries. Here, men on average charged $50.95 per hour, versus $35.63 for women.

Out of the six most popular areas, women were ahead in only one: software development & data science, charging $61.43 per hour, versus $61.21 for male counterparts.

Other sectors of note that males outearned females on a per hour basis:

· Sales & Marketing: males earned $73.97; females $59.01

· Accounting & Consulting: males earned $71.82; females $65.34

· Design & Creative: males earned $53.01; females $47.62

· Writing & Translations: males earned $52.15; females $49.30

Drilling it down to specialty, you see major hourly pay disparities across different specific roles. These include:

· DevOps Engineer: males earned $100.90; $30.00 for females

· Systems Administration: males earned $99.74 to $51.67 for females

· Email Marketing: males earned $103.04 to $69.79 for females

What’s Causing It?

Without seeing the “data behind the data”, I don’t have the full story. But a few thoughts come to mind:

Societal conscious and unconscious bias in pricing. We all know about structural distortions in how much women get paid in the workforce. It’s embedded. With that in mind, why should we be surprised that an institution that propagates such behavior with full-time employees just as easily transitions that to freelancers? And, sadly, certain cultural norms also run deep. If the technology industry, for example, continues to be viewed as more of a “male domain”, we shouldn’t be surprised to see the pay disconnect here.

Men lie and negotiate better. Well, when it comes to making money, research shows that men more regularly massage numbers higher when it comes to setting the tone for getting paid more in the future. I’m not saying women are angels here. But men are also more inclined to negotiate harder than women. Whether it’s confidence, ego, or blind faith, they are less likely to sell themselves short.

Women are anchored to lower rates. This dovetails with negotiation. Imagine your last corporate job at Abacus Inc. paid the equivalent of $50 per hour, while your male counterparts were on $55.

You leave the corporate world to take care of your newborn pride and joy and decide to try your luck at freelancing a few years in. Your male counterparts have in the meantime progressed to $60 per hour, but you’re still anchored to that $50.

Yes, you can do research to find out current rates of pay. But psychologically it’s far harder for someone to negotiate from a higher baseline to that which they’re used to. The pandemic helped widen the pay gap. And if a recession is coming, expect that to be repeated.

What Can Be Done About It?

Society still has some way to go to rectify imbalances. But we can still take steps to improve the odds. Here are some ideas:

Read the specific ZenBusiness report here. ZenBusiness has done an excellent job in collating information across a range of areas, including freelance writing (which I’m pretty sure will be interesting to many here). This will give you a good sense of how well (or not) you are getting paid in the world of freelance.

Read the report by Freshbooks on the same topic. Arm yourself with as much knowledge as possible. It’s a few years old but this report also outlines the remuneration disparity between male and female freelancers.

Learn the art of negotiation. Negotiation skills are key. There are plenty of resources out there to help you improve. One best-selling book popular in career coaching and written by an ex-FBI hostage negotiator is Never Split the Difference: Negotiating as if Your Life Depended on It

This YouTube video by the Kellogg School of Management entitled “High-Performance Negotiation Skills for Women” is also a valuable resource.

Get help from the New York Times. This New York Times feature on salary negotiation for working women is also an excellent start.

Learn how to set freelance rates. If you didn’t read to the end of the ZenBusiness article, you’re missing out on the 7 tips to set freelance rates.

Final Thoughts

The path to financial and personal freedom isn’t evenly paved.

And in the world of freelancing and side hustles, which espouse freedom, the irony is that accepting poor rates can trap you in a cycle of low pay.

It’s time to rectify that.

If you feel that you aren’t getting paid what you’re worth (and knowing your worth is a core principle behind negotiation), click on the links in the previous section for more information.

Even if we can’t shift society as fast as we would like, having improved knowledge about the marketplace and better skills to negotiate can only work to your advantage.

I’m a finance guy by trade with an additional background in career and life coaching.

Essentially, I created Spiritworth with the ambitious goal to help others “raise their spirit and raise their (net and self) worth.” A bit grandiose, perhaps, but you’ve got to shoot for something.

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