Pay Equity Gets More Attention, but Gaps Still Remain

While many HR leaders assess the fairness of their pay practices through audits, progress in closing pay gaps and ensuring equitable pay remains slow.

Recent SHRM research reviewed pay equity and transparency efforts in 2024 and identified areas where organizations succeeded, plus some that demand attention.

The most notable findings from the survey were:

• Although HR leaders may conduct pay audits, many fail to do so annually.
• Over one-third of HR managers did not think their companies demonstrated pay transparency.
• The gender pay gap persists across industries but varies depending on industry.

Shrinking the pay gap between men and women is a longstanding challenge, and despite efforts by many organizations, meaningful progress remains limited. If current trends continue, the pay gap will not close for U.S. women working full-time until 2067, according to an analysis of U.S. Census Bureau Data by the Center for American Progress.

Since pay gaps are a systemic issue, they require a systemic solution. HR leaders can use the insights from SHRM’s survey and the actionable steps below to create effective strategies that address pay disparities.

The State of Pay Transparency in 2024

The gender pay gap has narrowed slightly over the past decade. In 2024, the median weekly earnings of women working full-time were $1,043 — 82.7% of the median weekly earnings of their male counterparts, who earned $1,261, according to data from the U.S. Bureau of Labor Statistics (BLS).

SHRM surveyed over 2,000 HR professionals in the U.S. to better understand their practices regarding pay equity audits and transparency. Significant findings include:

1. Companies are conducting pay audits — but not consistently.

HR teams increasingly use pay audits to assess fairness, but many fail to conduct them regularly. Sixty-one percent of HR leaders said they conduct audits to identify pay inequities. However, only 54% review pay each year. Without consistent and timely audits, companies risk missing opportunities to correct disparities before they widen or allowing pay inequities to become part of company culture.

2. Pay transparency is observed — but not uniformly.

Despite the growing awareness of pay transparency’s benefits, less than half of HR leaders said their organizations provide clear information about compensation.

• 49% of HR leaders think their companies are transparent about pay with employees.
• 34% do not think their companies are transparent.
• 43% said their organizations did not share pay band or range information with employees.

Research shows that pay transparency can help close pay gaps. Job posts with salary information garner more applications and a higher quality of applicants. Additionally, pay openness builds trust and accountability with employees and candidates, improving retention, reputation, and employee happiness.

3. The gender pay gap persists.

BLS data also found that the gender pay gap differed widely within various major occupational groups. For example, in community and social service occupations, women were paid 97.4% of the salaries of their male counterparts. In contrast, women working in the legal sector were paid 63.8% of their male counterparts’ wages. In occupational groups with large gaps, women were often concentrated in lower-paying occupations within that group. However, even in the same occupation, women were often paid less than men.

Achieving Pay Equity and Transparency

SHRM’s research indicates that HR leaders want pay equity and transparency. This long-standing issue must be addressed to ensure better recruiting, engagement, and retention. But to make inroads, leaders need a systematic effort that includes:

1. Developing, understanding, and communicating the organization’s compensation philosophy. Ensure managers are educated and comfortable discussing the philosophy and pay decisions with current and potential employees.
2. Conducting regular pay audits. Slightly more than half of HR leaders in the SHRM study said they conducted audits annually. Developing a frequent cadence allows organizations to identify positive and negative trends and pivot when necessary.
3. Addressing any pay inequities highlighted in the pay audit. An audit is only the first step. Leaders must also address any findings from the audit and develop a strategy to prevent future gaps. Review policies and practices that may create implicit bias. Look for opportunities that enable all employees to advance.
4. in all candidate and employee decisions, including interviewing, hiring, and promotions.

Organizations will not achieve pay equity through a piecemeal or inconsistent approach. Instead, HR leaders must implement a holistic strategy with a long-term commitment to tackle pay inequities throughout the organization.