Getting to the Bottom of Harvard Graduates' Gender Pay Gap

If the women of the Ivy League aren’t making as much money as their male peers, what hope does everyone else have?

A graduating student sits in the shade during Harvard's 2012 commencement ceremony. (Brian Snyder / Reuters)

Kevin Carey at The New York Times recently crunched some numbers from a federal data set that considered the eventual earnings of students who received federal financial aid to enroll in American colleges and universities. He reported that among Harvard students whose parents’ incomes were low enough to qualify them for aid, men make vastly more than women 10 years after graduation. In general, American women make 79 cents on the dollar compared to men. For those who attended Harvard, the disparity is even worse: female alums make 63 cents for every dollar male classmates earn. That’s about what the pay gap was for women in the 1960s.

The primary explanation for this is perhaps obvious: Harvard men are earning fantastic amounts of money. Harvard women aren’t doing poorly at all. In fact, Carey’s data shows that with average salaries of $110,000 per year 10 years after graduation, they’re earning more than women from any other university. It’s just that by comparison to their male colleagues, who are earning over $160,000 at that same point, they’re a lot further behind.

Indeed, this pattern holds across the most elite institutions. Carey notes that “there is an earnings gender gap at every top university” in the country, including at each Ivy League school. Female graduates of Penn are earning $92,000 a decade out; their male peers are earning just over $140,000. For Princeton alumnae the average is $90,000, and for the men it is $138,000. Yale women may be making a comfortable $79,000, but Yale men make $118,000. All of this points to a system in which at the higher ends of the economic ladder, the income disparities between men and women are wider. (By contrast, men and women who are low-income all make roughly the same wages.)

It is worth noting again that these numbers are means, not medians, meaning that a small number of extremely high earning people will pull the numbers dramatically. This could happen if, for example, a few male members of one class found a website such as Facebook and make billions.

But that shouldn’t put the matter to rest. This gap remains troubling. Shouldn’t Harvard and other elitely educated women be doing roughly as well as their male peers? Especially only 10 years out from graduation: At that point, many of these women have not yet begun to wrestle with the intractable problem of motherhood, which will depress their earnings for the rest of their lives. Indeed, a decade after graduation might be a point at which women’s earnings compare relatively favorably to men’s. In their early twenties, women in general make only five percent less than men. According to a recent report by the American Association of University Women, “Women typically earn about 90 percent of what men are paid until they hit 35. After that median earnings for women are typically 75–80 percent of what men are paid.”

For many female Harvard graduates, then, 63 cents on the dollar may be as good as it gets.

So what gives? Are they opting out, leaning back? Unlikely, if they’re still making six-figures on average. Why then aren’t these women keeping up?

One worrying explanation is that women are perhaps not able to tap into these schools’ affluent and powerful alumni networks as easily. For example, at Harvard many connections to alumni are forged at the schools so called “final clubs,” seven of which are all-male. Each has a venerable history and enviable alumni network that helps its members cultivate outlier jobs in exceptionally high-paying fields such as lobbying, finance, and tech. This leaves the ladies to continue bumping their heads against the glass ceiling. Only a reported 10 to 20 percent of Harvard’s male students benefit from membership in those clubs, but perhaps they might produce enough high-earners to skew the average. (I reached out to Harvard Career Services for comment, but did not receive a reply.)

The outside world is to blame too. When women, without the benefit of the same chummy, lucrative connections as their male peers, make it to executive positions, they usually find that they are still paid less than men. The Washington Post reports that, even among CEOs, a significant pay gap persists, largely because of entrenched biases in how female leaders are evaluated and viewed: “Women tend to be considered on the basis of their performance, while men are often promoted for their potential,” the Post wrote. Again, this illustrates that, at the higher end of jobs, the discrepancy between when men and women earn is larger than at the lower end.

Yet women are often as successful in these fields, if not more successful, than men. Women-owned and -managed hedge funds, for example, have significantly outperformed male-owned and -managed hedge funds every year except one since the finance world began tracking results by gender in 2007, providing annualized returns of 5.64 percent, compared to 3.75 percent. Despite this stellar record, women still report finding it more challenging to raise capital.

It bears repeating that the Harvard women in the study, those who qualified for financial aid as students, are making, on average, enough to send a child of their own to an Ivy League school without assistance. They have come far and done well. Still, the fact that their male peers have gone further and been rewarded yet more richly remains an issue for anyone who cares about fairness. After all, if even the hardworking, ambitious female graduates of Harvard University cannot reach anything close to pay equity with their male peers, what hope is there for everyone else?