Dive Brief:
- The widening of gender pay gaps may be in part due to the tendency of male employees to use external job opportunities to negotiate higher pay, a tactic in which comparatively fewer female employees engage, according to a study of Swedish workers published by the Rockwool Foundation Berlin Institute for the Economy and Future of Work.
- RFBerlin analyzed Swedish-wide population data and linked workers to job opportunities of similar pay, productivity and location. Researchers found that, while men who had new opportunities often saw their wages rise in the current job, women with similar opportunities did not receive such increases.
- Because women in the study moved jobs just as often as men when offers arose, researchers concluded that the difference in pay could be attributed to renegotiation tactics rather than differences in opportunity. RFBerlin noted that in jobs where bargaining is limited, the gap caused by job opportunities disappeared.
Dive Insight:
The uncontrolled gender pay gap has widened over the past year, a recent Payscale report found, with women earning approximately $0.82 for every dollar earned by men. The organization further found that the gap exists at every educational level and widens as women age and progress in their careers.
Multiple factors contribute to the gap’s existence, but negotiations may have a multifaceted role. For example, a 2026 Cornell University study found that women consistently preferred jobs with narrower salary ranges, which researchers linked to negotiation behaviors that were less assertive than those exhibited by men.
According to RFBerlin, offering information about outside job opportunities may not be enough to close pay gaps, given the differences between men’s and women’s negotiation styles. The organization recommended implementing structured wage-setting practices that reduce the role of bargaining in setting pay as well as bargaining and information support for roles in which pay setting is more flexible.
“Closing these gaps requires attention not only to hiring and job choice, but also to how wages are renegotiated once people are already employed,” RFBerlin said.
Other studies have shown that even small changes to compensation strategy can affect pay gaps. Research published in February by the University of Texas at Austin found that framing pay increases as percentages of an employee’s existing salary led to smaller overall reductions in the average gender pay gap than when such increases were framed in actual dollar amounts. This may occur, one of the researchers said, because organizations implicitly view percentage increases as fair despite employees beginning from an unequal baseline.