Michelle Holder, Ph.D., economist and Assistant Professor of Economics at John Jay, is shedding light on the racial and gender pay disparities Black women face in the United States. In her research report, The Double Gap and the Bottom Line: African American Women’s Wage Gap and Corporate Profits, supported by the Roosevelt Institute and John Jay College, Holder examined how Black women are under-compensated because of at least two types of discrimination in wages—racial and gender. “There is a culture of poverty argument in the United States that Black people have a myriad of outcomes that tend to be worse than white people because of Black culture. My mission is to disprove and divert those arguments,” she says. We sat down with Holder to learn more about her research and how the numbers support the alarming fact that Black women, and Black communities, are losing out on billions of dollars every year due to the double gap.

When did you realize that you wanted to research the double gap caused by gender and racial discrimination?
Honestly, I didn’t wake up one day thinking, I’m going to write about the wage gap as it affects Black women. This was a journey and a process. The Roosevelt Institute is an institution that focuses on how income distribution in this country has affected everyone, and how outside corporate profits are bad for our democracy. They were looking for an economist who could write something substantive linking income maldistribution and issues of discrimination that people of color face. So, they reached out to me. I knew that most people in the U.S. were familiar with the issue of the gender wage gap. As a Black woman, I wanted to look at the gender wage gap from the perspective of women of color. My mission was to write a report that was well researched, wasn’t too academic, and really laid this issue out.

What was your methodology for researching this topic?
All women in the U.S. have been estimated to earn 80 cents for every dollar that men make. The issue with the gender wage gap is that we were not comparing the wage differentials between a woman in the same occupation as a man. If you unbundle that kind of 80 cents to the dollar mantra, there are a lot of things that play into that differential in terms of what types of jobs women have, what types of jobs men have, and the caregiving responsibilities of women. Because I was aware of this, I didn’t want someone to look at my report and say you are overlooking the fact that there’s still an educational attainment gap between Blacks and whites in this country that plays into differences in the compensation. I wanted to compare similarly educated, similarly qualified, and similarly experienced Black women working full time in the workforce, to their white male counterparts. I wasn’t comparing, for example, a Black female nurse to a white male orthodontist. That was the methodology that I used. I looked at all Black women in the U.S. workforce, working full time in 22 major occupational categories. I compared those women to their white male counterparts to see what was the difference in pay. Any other differences that could not be attributed to differences in race and gender were essentially removed.

Where was your data collected from?
The data for my report came from the American Community Survey Data, an annual data set from the U.S. Census Bureau. It’s a very robust data set of about three million respondents. The research had to be rigorous because of pushback. The economics profession is white, male-dominated, and as a Black female economist, whenever I start a project, I try to be one step ahead. I think about what I think I’m going to find. And then, based on what I think I’m going to find, I try to figure out what is going to be the pushback. I’m a progressive economist that critiques the American capitalist system. There’s a lot that doesn’t work in our economy for women and people of color. I knew that once I came out with my findings, someone was going to say, “This is not the reason, this is the reason.” I deliberately took control in anticipation of all of that kind of pushback.

What was your biggest takeaway from the data you analyzed?
The main takeaway of the report was that due to the gender wage gap, working Black women in the U.S., and by extension, the Black community in the U.S., were estimated to be losing out on 50 billion dollars a year. That’s a conservative estimate. I also had an independent methodology done. I went to a white male colleague, Thomas Masterson, who is the Director of micro-modeling at the Levy Institute at Bard College, and I asked him to quantify the same data. I didn’t give him my numbers. I told him, “Can you use your methodology to quantify this?” He did and our numbers were well within the range of each other. So not only did I use two methodologies, but I got an independent methodology and they both revealed that every year Black women involuntarily lose billions.

The second takeaway is a loss that Black women know about. We know that we are being underpaid in theory, but in practice, we don’t know when it’s happening. The only way that you can know if you are being equitably compensated with peers from another race or another gender—when you’re both doing comparable work, you’re similarly qualified, similarly educated, and similarly experienced—is to know the salary structure. We don’t have access to that information. The closest we can get to that is if you worked for the public sector. In the nonprofit sector, compensation is often hidden. This is a problem that Black women face. But at the moment, we don’t know we are facing these problems and to what degree it is because we don’t know what our peers are making.

Have you ever directly experienced the effects of the double gap?
I was at a startup organization and there were only six employees. When I was hired, the subtle message was, “We’re a startup company. We can’t pay a whole lot. Be modest.” I decided that I wouldn’t ask for the sun, moon, and stars. I said, “Just pay me what I was making when I left my old organization.” They were happy about that. After I was hired, I was privy to our salary structure because I was helping to get the infrastructure for the nonprofit together. There was a white male colleague and a white female colleague. The three of us were similarly experienced and similarly educated, but they were making five to 10 thousand dollars more than me. I went to the head of the organization and I said, “There’s a problem here. The three of us are at the same level, hierarchically speaking. Why are they making more than me?” And his first response was, “Michelle, you really shouldn’t be using information you are privy to, to advocate for better pay.” He was right, but I had caught him red-handed. In the end, he had to increase my pay. He had no choice. It would have been a lawsuit. But, I would not have known this if I didn’t have access to the organization’s salary structure and to information about what my peers were making. That is the case for the majority of Black women working in the United States. Black women know in theory that we’re underpaid, but in practice, we don’t get the opportunity to prove it.

What do you believe is contributing to the continuation of the double gap?
There are overt and implicit practices that are feeding into this double gap. I think there’s a culture of women not being valued as much as men, and Black people not being valued as much as white people. If I have to identify who’s responsible, it is employers. But I’m not saying that employers are deliberately deciding to pay Black women less. I don’t think it’s an insidious action on the part of the employers. One reason this is happening is because of employer perception, which is fed by implicit bias. For example, in the report, I write about the fact that when women try to negotiate with prospective and current employers as aggressively as men, and when Black people try to negotiate as aggressively as white people, there is a backlash. This happens because there is a violation of expectations on the part of the employer about how women should negotiate and what women should be satisfied with. And similarly, how African-Americans and other Black people should negotiate and what they should be satisfied with. There’s also this practice where women apply for a job and the employer asks for their salary history. This practice has been shown to result in women getting paid less, particularly women of color.

What should Black women do in these situations?
For Black women, I make a recommendation in the report, qualifying it, by saying that this double gap is not due to any lacking on the part of Black women in terms of negotiating. Because one of the pushbacks will be that women and Black people lack the appropriate negotiating skills. They'll say, “It’s not a race thing. It’s not a gender thing.” I don’t buy that argument. This is not an innate problem. We are dissuaded from negotiating. It’s not any lacking on the part of women, Black people, or Black women. So, it’s not really up to us to solve this.

But given the context, one thing that black women can do is negotiate for compensation and benefits whenever possible. Once Black women figure out how much they want to ask for, what they think they deserve, and have consulted with family and friends, I recommend that Black women ask for a little bit more. If you’re about to be promoted or hired for a job and you’ve done your research, and you think that 65,000 dollars seems like it would be fair compensation, my suggestion is to ask for five to 10 percent more than that. Don’t try to just singularly close the gender wage gap and ask for 50 percent more, because there will be backlash. The research is very clear on that. Don’t go in, guns blazing. Ask for five to 10 percent more. If you want to go for broke, ask for 15 percent more. You might not get it, but if you don’t ask for just a little bit more, you definitely won’t get it. Even if you’re a woman of color who’s a blue-collar worker, you might not have a lot of wiggle room with compensation, but there are other things that you can ask for, like a better work schedule or extra vacation days. You might not get it, but you should ask because the chances are really good that you’re being underpaid, under-compensated, undervalued. These are the small actions you can take to try to chip away at that.

What can companies do to help close the double gap?
If progressive-minded employers want to take action to determine whether or not something is awry in their organization, there’s a whole infrastructure in place to determine that: It’s called a pay parity audit where independent and trained professionals can be brought in to look at the salary structure. It’s simple and straightforward. And can determine whether there are inequities in the compensation structure in an organization. But employers have to be willing to do that. In fact, when executives are being considered for raises, they bring in auditors to look at the compensation structure within an organization, to look at comparable compensation structures within the industry, to then make a recommendation to the board of directors whether or not the CEO should get half a million more. This is routinely done. What has to be accompanied is an employer’s will to not just be focused on executive-level compensation, but compensation for the least paid employee.