A gender and racial wage gap persists in 94% of occupations.
When Maria Serratos—a 25-year-old Latina majoring in civil engineering at Mississippi State University—was working as a bookkeeper at a grocery store to help pay for college, she was not aware of the wage gap, or that it costs Latinas $1,188,960 over a 40-year career.
However, she did become aware that a male bookkeeper who was doing the same job and working the same amount of hours at the grocery store was getting paid more per hour than she was—despite the fact that she had been in the position for longer. Assuming her male counterpart was making more money simply because he had asked, she decided to approach her boss for a raise. Serratos' manager said no to a raise and that her co-worker was making more money because he had just had a baby and needed the money more than she did.
The manager’s response illustrates persistent gender bias that continues to impact women’s lifetime earnings, such as how men experience a ‘fatherhood bonus,’ or increase in salary when they become a parent, and women receive a ‘motherhood penalty,’ or decrease in pay when they become a parent.
“At the time, I thought the unequal pay between myself and my male co-worker was just at my particular workplace,” says Serratos. “Then I took a workshop at my university, where I learned this happens to many, many women—not only in the state, but also across the nation.”
Serratos was asked to share her personal story at a labor committee meeting urging state lawmakers to pass equal pay legislation. “Mississippi ended up passing an equal pay bill, so it was super cool to be involved in that and see a change,” says Serratos. This made Mississippi the last state in the nation to pass legislation requiring equal pay for equal work.
In order to change an issue, the first step is to become aware that it exists. That’s why Equal Pay Day is so important for raising awareness that women continue to be undervalued and underpaid. This year Equal Pay Day falls on March 14, representing the fact that women working full-time, year around earn only 84 cents for every dollar paid to white, non-Hispanic men. The gap widens for many women of color, with Latinas and Native women making 57 cents, Black women 67 cents, white women 80 cents and Asian American, Native Hawaiian, and Pacific Islander (AANHPI) women 92 cents. Parental status, gender identity and sexual orientation also impact the wage gap.
“The wage gap is a useful measure because so many sources of inequality show up in that number—from paying someone less for the same job to the disproportionate impacts of caregiving to the fact that the occupations where women are overrepresented tend to be paid less simply because we undervalue women's work, full stop,” says Emily Martin, VP for education and workplace justice at the National Women’s Law Center. “Dozens of studies show that when you control for all the factors that should be relevant to the wage gap, such as occupation, education, experience level, and hours worked, we still see consistent wage gaps where men are being paid more than women.” In fact, a gender and racial wage gap persists in 94% of occupations.
The cost of women, on average, earning 84 cents on the dollar to what a man makes adds up to a loss of nearly $400,000 over the course of a 40-year career. For Latinas, Native and Black women, the lifetime losses translate to about $1 million or more, meaning many women of color would have to work to 80 or 90 years old—beyond their life expectancies—to ever catch up. “The math is such that if we don't close the gender wage gap, every year women and all of the families who depend on women are falling further and further behind,” says Martin.
Apart from the wage gap robbing women of lifetime earnings that impacts their Social Security payments and retirement, not paying women fairly also impacts their children and families, as nearly two-thirds of women are their family’s primary breadwinner. At our current rate of progress, it will take 132 years for the world to close the overall economic gender gap, but doing so could help boost the world’s economy by $7 trillion.
Closing the wage gap also benefits workplaces. “It is also the case that if you are underpaying women, you may not be attracting half of the really qualified and talented potential employees out there,” says Martin. “So employers have some interest in ensuring that they are doing what they can to make it worth their women's while to commit to them as an employer.”
Closing the wage gap calls for a multipronged approach, from offering affordable childcare to paid family and medical leave to fair scheduling practices. Workplaces can lead the way in closing the gender wage gap while we’re waiting for policies and legislation to catch up, but there are a few policies being made that are a step in the right direction.
The Pregnant Workers Fairness Act recently passed. “What that does is it says employers have to make accommodations for pregnancy just like they do for disability,” says Martin. “While that's not going to end the wage gap tomorrow, it is part of ensuring that the moment of having a child isn't a moment where you're being forced out of work altogether, with the immediate and long-term consequences for your paycheck. It is a step towards ensuring that we have workplaces that treat childbearing and childrearing as a matter of course and work around it, rather than still acting like it is some strange deviation from the norm.”
Pay transparency is also becoming more common, with one in four Americans living in places where employers are required to share pay ranges. “There’s a growing body of research that shows pay transparency leads to smaller wage gaps, to more equity, and tends to raise wages for lower-wage workers in particular,” says Martin. “Interestingly, we've also seen in recent years a lot of states saying you can't base pay on someone's salary history, and one study showed this had an impact on closing gender and racial wage gaps, such as by making employers more likely to put salary ranges in job announcements if they couldn't screen people based on their past salary. I think there's a lot of potential there.”
Speaking up and pushing for policies to help close the wage gap can impact change, as Serrantos experienced when advocating for equal pay legislation in Mississippi. “How are we supposed to build generational wealth if we are getting set so far back [financially] from the get-go?” Serrantos says. “It's important women become more aware [the wage gap] is an issue that is affecting us, and we need to start making some noise.”
