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African American and Hispanic tech workers still earn less than their white counterparts

JP Mangalindan
Chief Tech Correspondent
African American and Hispanic tech workers still earn thousands of dollars less than their white counterparts, according to a new study.

As innovative as Silicon Valley is, there’s one area where it still comes up woefully short. Equal pay for many minority workers remains a serious issue, even if the pay gap slightly narrowed in 2017 from a year earlier.

According to jobs site Hired.com’s latest State of Salaries report released Thursday, tech companies offer African American and Hispanic job candidates about $6,000 less on average than their white counterparts, $130,000 and $131,000, respectively, compared with $136,000.

The racial gap may be partly the result of African American and Hispanic tech workers undervaluing their skills asking for less pay. Hired contends that this is most likely due to the fact that African American and Hispanic workers are underpaid in comparison to white workers. To wit, African American and Hispanic candidates on the Hired platform last year asked for the lowest salaries, $124,000. That falls well short of white tech workers, who ask for an average of $130,000.    

While that trend, unfortunately, remains unchanged from 2016, Hired’s State of Salaries report last year reported that the pay wage gap was up to $4,000 wider in 2016, when African American and Hispanic candidates were offered between $115,000 and $120,000, compared with the $125,000 offered to white candidates.

The most recent Hired.com’s State of Salaries report released Thursday was compiled based upon 420,000 interview requests and job offers that occurred in 2017 through its online marketplace from more than 10,000 participating companies and 69,000 job seekers. The company also collected survey responses from over 700 tech workers to factor in how salaries and cost of living influence decision making and levels of satisfaction.

What tech companies are doing to address the pay gap

Unfortunately, Silicon Valley’s pay wage discrepancy among minority and white workers, is far from unique. According to an annual report released in September by the U.S. Census Bureau measuring poverty, income, inequality and health-insurance coverage in America, the pay gap between white and black men and women remain vast. The median household income for black households was only $39,490 in 2016, while the median household incomes for white households during the same period was $65,041 — a staggering $25,551 difference.

Tech companies, for their part, have become well aware of the problem. In recent years, companies such as Facebook (FB) and Salesforce (CRM) have hired executives focused on improving diversity within their ranks. Others, such as Airbnb, Lyft, Twitter (TWTR), and Pinterest are trying to promote a more diverse workplace by eliminating bias from the hiring and promotion process. All four of those companies, for instance, use a firm called Paradigm to filter out and fix barriers and unconscious biases that could influence employee hiring and retention, such as anonymizing resumes so employers can’t tell a candidate’s gender or ethnicity.

And while those efforts may yield little in the way of change in the short-term, they are cause for cautious optimism in the medium-to-long term.  

JP Mangalindan is the Chief Tech Correspondent for Yahoo Finance covering the intersection of tech and business. Email story tips and musings to jpm@oath.com. Follow him on Twitter or Facebook.

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