Women in CRE Face Pay Disparity, Fewer Promotions

In part two of our coverage of women in the commercial real estate industry, we look at how much discrimination female professionals face.
This is part two of NREI’s two-part study on the prevalence of sexual harassment and discrimination in the commercial real estate industry. Read part one here.
A significant percentage of women continues to struggle with discriminationwhen it comes to pay and professional opportunities in the commercial real estate industry.
The majority of NREI survey respondents (72.7 percent) said that sexual discrimination, including getting a lower salary than someone of another gender or sexual orientation doing the same job and getting passed over for assignments and promotions, occurs in the industry. (Overall 57.6 percent of male respondents said it occurs vs. 92.1 percent of female respondents.)
Of those that agreed discrimination occurs, 40.8 percent described it as a “common occurrence,” though not widespread. Another 34.7 percent said it is rampant. Only 8.0 percent of those respondents described that type of discrimination as a rare event in the industry. An additional 16.6 percent said they were not sure how prevalent it is.
One female staff member at a publicly-traded company described the following situation, which based on overall reader comments, seems to be common in the industry at large. When a male colleague left his post a few years ago, she got promoted to his position. Since she got a pay raise to go with the job, she said she felt happy with her promotion until her former coworker, with whom she stayed in touch, alerted her that her new salary was still almost 14 percent below what his had been. The news came as a shock, and she attributed it at least partially to the fact that her friend had been with the company a bit longer. At the same time, she didn’t have much of a choice—when she tried to raise the issue, it was underplayed under the guise of it being against the rules to discuss staff salaries.
More recently, the woman became interested in getting a promotion to another department. But in spite of her years of experience, the recommendation of her boss and her stated desire for the position even if it did not carry a salary increase, she was told she “was not ready” for the post. When the woman asked her higher-ups for feedback about what would allow her to advance, they didn’t have any to offer. Instead, the job went to a man with less experience and fewer professional qualifications who had become friendly with the CEO of the company. In a “good ole’ boys” atmosphere, where the men at the company spent a lot of after work time together without inviting female coworkers, that seemed par for the course. The woman has since decided to look for a job with another firm, but she never brought the incident to human resources’ attention. “I have been reluctant to report because I don’t want to be seen as the person pulling the gender card,” she notes. Yet she adds that the experience came as a shock after years of working in a field where women were routinely encouraged to rise up the professional ladder. “I’ve never thought that I would experience it,” she says. “I thought it was something from 50 years ago—I had no idea it was [still] going on.”
In fact, 67.9 percent of women who responded to the survey said they had been discriminated against in the workplace (vs. just 4.8 percent of men). Overall, 25.7 percent of respondents said they witnessed discrimination taking place. An additional 16.2 percent said that a family member, friend or coworker had such an experience. A little less than half of respondents (48.1 percent) said they never encountered sexual discrimination in the industry.
The numbers were a little more diverse when it came to responses from male and female readers. A full 47.1 percent of male respondents said that sexual discrimination was a “common occurrence” in the industry, but only 15.0 percent expressed the view that it’s “rampant.” More than half the female respondents (50.6 percent), however, said that discrimination was “rampant” in commercial real estate and 35.6 percent described it as a “common occurrence.” Only 2.3 percent of women said it was “rare.”
The percentage of men who said they witnessed it happening to other people totaled 16.5 percent and 9.6 percent said a friend, family member or co-worker went through the experience. But the majority (71.5 percent) said they never encountered discrimination.
When it came to women, on the other hand, 37.9 percent said they witnessed discrimination in the workplace and 24.7 percent had a family member, friend or colleague in the industry who was discriminated against. Just 17.4 percent of women respondents said they never encountered discrimination in commercial real estate.
One of the most frequent complaints voiced by women was being paid significantly less than male coworkers doing the same job. The most recent benchmark study on women in commercial real estate put together by the CREW Network, which took place in 2015, found that there was still a 23.3 percent gap between the median total annual compensation for men and women in the industry.
CREW Network declined to comment on the NREI survey directly, but the organization’s spokesperson pointed out that in the benchmark study, women in the industry listed lack of a company mentor, lack of promotion opportunities and gender discrimination as the three most common barriers to their career success.
CREW’s follow-up research in 2016 found that 65 percent of the professionals the organization surveyed either personally experienced or witnessed discrimination against women in the commercial real estate industry.
Meanwhile, Denise Froemming, CEO and executive vice president of IREM, notes that while the organization realizes there is still a pay gap between men and women in the industry, 59 percent of IREM’s approved Certified Property Managers and 71 percent of approved Accredited Residential Managers last year were women. Froemming also points out that the organization continues to work with its diversity advisory board to provide opportunities to everyone interested in a career in commercial real estate.
In NREI survey’s open comments section, there were reports of women being passed over for lucrative assignments and promotions in favor of male coworkers and multiple comments about women being held back after becoming pregnant, or what several called “mommy-tracked”—including one instance in which the company owner had to be informed that he cannot fire an employee just for getting pregnant. A significant number of respondents also wrote about being excluded from important company discussions and being treated in a condescending, “being patted on the head” kind of way in meetings.
Several noted that coworkers often assumed they advanced because they were attractive or slept with their bosses rather than through their own accomplishments. “I was once told I wasn’t given a promotion because the person that recommended me must have a crush on me,” one wrote.
Another woman, the CEO of her own company, described how in meetings with outside contacts and at industry events, she’s rarely identified as the likely head of the firm. There’s an element of “she can’t be the leader, the smart one, the founder,” she noted.
In addition, a male survey respondent noted that women sometimes don’t get the pay raises they deserve because they happen to have a well-earning spouse. “While not overt, I think there often is a double standard in how women and men are treated,” he wrote.
Members of the LBGTQ community described similar experiences of discrimination. “I have not been promoted on a couple of occasions and within different companies because of my sexual orientation and the false perception that I was ‘less motivated’ because I do not have children,’” one wrote. “In other words, I did not fit into the expected ‘white male heterosexual with kids and family’ profile the firms preferred promoting.”
Yet a relatively modest percentage—30.9 percent of all respondents—tried to address the disparities through their companies’ official channels. A significant number (54.3 percent) said their company simply had no mechanism in place to address such concerns. Another 21.5 percent said their company had protocols in place to deal with discrimination, but the guidelines were unclear. Just 9.6 percent said their employer had clear regulations in place to address sexual discrimination. Some also noted that instances of discrimination are “extremely hard to prove” and that a lack of confidentiality often discourages reporting.
In discussing how the commercial real estate industry can better address the issue, many commenters cited continued education about what constitutes discrimination and more streamlined guidelines in awarding pay and promotions (based on years of service and professional accomplishments). A number of respondents also wrote about executive leadership needing to set an example for lower-level managers.
“Top management needs to do more than just talk the talk,” one person noted. “They need to look a few levels down and see what the middle management is doing to promote (or not) promising women. In my age bracket, the top women get fed up and typically leave brokerage, often going to the owner’s side, or to smaller firms, where they will be treated better.”
The CREW Network, in its 2016 whitepaper, urged the leadership at commercial real estate firms to engage in honest assessment of potential gender bias, including hiring diversity consultants and putting in place accountability measures to combat discrimination. It also stressed the importance of providing women in the industry with mentorship and sponsorship opportunities and encouraging industry members to speak up when they witness discrimination.
Methodology: The NREI survey included 449 participants. Respondents’ professional specializations ranged from leasing/investment sales/land brokerage (16.3 percent) to private real estate investment (12.0 percent) to pension fund/institutional investor/fund management (6.8 percent) to corporate real estate (9.1 percent) and building/development (11.3 percent), among other categories. The most commonly cited organization size involved firms with fewer than 10 employees (26.8 percent), followed by firms employing from 11 to 50 people (23.2 percent) and then firms of 1,000 or more people (19.4 percent). The average age of respondents was 50 years old. Men made up 57.0 percent of respondents, while women made up 43.0 percent.
By: Elaine Misonzhnik (National RE Investor)
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