African-Americans are more likely to get hired, but get paid less in tech industry

JP Mangalindan
Chief Tech Correspondent

For all its so-called innovation and egalitarianism, Silicon Valley may remain just as problematic as the rest of America when it comes to the pay gap between African-American and white workers.

According to a study by Hired, a San Francisco-based tech worker recruiting firm, the average African-American candidate is 49% more likely to get hired than the average white candidate in the tech industry’s two largest markets, San Francisco and New York.

But when it comes to actual salaries, African-American tech workers — software engineers, in particular — woefully fall behind. According to the report, that’s because they ask for and receive significantly lower salaries: $113,000 and $115,000, respectively, versus their white counterparts who ask for and receive salaries $10,000 more on average.

African-American workers are more likely to get hired but get paid less money. AP Photo/Marcio Jose Sanchez

Hired based its findings on salary data it gathered from over 280,000 interview requests and jobs offers over the last 12 months from over 45,000 job seekers. Those findings may seem counterintuitive given African-Americans as of last spring made up just a small fraction of the predominantly white and Asian male workforces found at many large technology companies. The workforces at many large tech companies on average were 71% men, 29% women, 60% white, 23% Asian and just 7% black, “PBS Newshour” reported in March 2016, citing analysis at the leading tech firms that report such numbers.

The pay gap between African-Americans and their white counterparts is even worse if you look at the broader landscape in the US. According to a report released in September from the Economic Policy Institute, black men earned 22% less and black women made 34.2% less on average than their white counterparts across the US as of 2015 — regardless of profession, despite living in the same geographic areas and having comparable education experience.

What’s less clear, however, is why exactly African-American workers in tech receive more offers than their white counterparts.

“It’s unclear if African-American candidates are receiving more offers because of their diversity initiatives, a lower preferred salary, or a combination of those and other factors,” Hired’s report adds.

Tech companies more recently have begun implementing new measures to improve the diversity of their workforces by gender and ethnicity. Salesforce (CRM), for example, announced its first-ever chief equality officer this past September to focus on initiatives that bring greater diversity to the business software company.

Others like Twitter (TWTR), Pinterest, Airbnb and Slack are trying to promote a more diverse workplace by eliminating bias from the hiring and promotion process. All four of those companies, for example, employ the firm Paradigm to suss out and correct barriers and unconscious biases that could be affecting their diversity efforts. Those include anonymizing resumes so employers can’t tell a candidate’s gender or ethnicity, or modifying a salary negotiation process that places women and minorities at a disadvantage.

That last step, in particular, could be one way to ensure parity between the salaries of African-American and white workers.

JP Mangalindan is a senior correspondent covering the intersection of business and technology.

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