Mendoza School of Business

Will Hollywood fix its pay bias against women?

Published: February 28, 2014 / Author: Timothy Judge

The following article in CNN Opinion was written by Management Professor Tim Judge. In a recent study, “Age, Gender, and Compensation: A Study of Hollywood Movie Stars,” Professor Judge and his colleague Irene De Pater found that young female actresses earn more than young male actors but that the men age “better” in the sense that their salaries increase over time, whereas those of the actresses do not.

Who would you say is more successful: Academy Award nominee Leonardo DiCaprio, or Academy Award nominee Meryl Streep?

In terms of numbers of memorable — even legendary — screen roles, it might be difficult to say. And in terms of lasting power, they both have grown in reputation over the years. But in terms of most recent earning for the year 2012-2013, the winner is clear: Leonardo Di Caprio, age 39, earned $39 million in pay while Meryl Streep, age 64, earned only $7 million. (One caveat: Their earnings are also influenced by the box office success of their films.)

Sure, that’s just one year and those are just two stars. But if we look across the board, we can’t help but come to the same conclusion: There’s an unfair pay disparity in Hollywood.

As we look forward to this year’s Academy Awards show on Sunday night, it’s worth taking a moment to reflect on the movie industry and what it tells us about ourselves.

Research that my colleagues Irene de Pater, Brent Scott and I conducted shows that whereas young Hollywood actors and actresses make about the same in yearly earnings, that parity quickly evaporates as they age. According to our study, for actresses, their pay peaks at age 34 and then drops quickly thereafter. For actors, their pay peaks at a much later age — 51 — and just as importantly, does not drop after that nearly as severely as it does for actresses.

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