Kate Bahn , Christian E. Colin Seeberger Director, Media Relations. Act Now for Equal Pay Tell your senators to pass the Paycheck Fairness Act, which would strengthen existing equal pay protections, prohibit retaliation against workers who discuss their pay or challenge pay discrimination, and much more.
What is the gender wage gap? This fact sheet focuses on wage gaps between women and men because that is how the data have historically been collected and analyzed.
However, as discussed throughout the text, more comprehensive data are needed to gain a clearer picture of all wage gaps in the workforce. Specific tables used are on file with the author. Calculations are based on median annual earnings data from American Community Survey 1-year estimates, whereas the cent figure for Asian women overall is based on median annual earnings data from the Current Population Survey. Francine D. Blau and Lawrence M. Figures are not adjusted for inflation and earnings are in dollars.
The cumulative earnings gap reported compares monthly labor force totals for all four fiscal quarters of and BLS median usual weekly earnings of full-time working women and men of all races from all four fiscal quarters of For quarterly earnings for women and men overall, see U. See Paycheck Fairness Act, H.
You Might Also Like. Aug 13, Jocelyn Frye. Apr 27, Kate Bahn , Christian E. A company's gender pay gap can also be caused by other things, for example fewer women in senior or highly-paid roles or more women in part-time jobs. This analysis is based on the difference in what men and women are paid per hour, but there are other ways of calculating the gender pay gap: the Office for National Statistics also releases annual figures.
Some may be tempted to dismiss the requirement for big employers to report gender pay gaps as red tape or even virtue-signalling.
But it's been a useful, if rather blunt, tool in highlighting and supporting the progression of women, showing where work is needed and where strides are being made. With the current challenge of finding enough skilled workers to keep the economy moving, making the most of the talent we have is vital.
However, this time, the process has been clogged up by the pandemic. The delay in reporting means these particular numbers refer to the distant days of spring , and workers who were furloughed may not be included, making it hard to track how some companies have improved - or not. In time, that distortion will disappear. In the meantime, there will be a more up-to-date picture of gender pay across the country, with an alternative survey of organisations of all sizes from the official statistics body, the ONS, later this month.
That had previously shown the gap narrowing. The UK was a pioneer in reporting gender pay, but some say the policy lacks teeth without concrete action plans. They urge businesses and policy makers to overhaul areas including childcare and organisational culture as they seek to "build back better", to make emphatic progress and avoid this being an annual box-ticking exercise.
Gender pay gap enforcement delayed by six months. Image source, Getty Images. Non-binary pay. Understanding the terminology. The gender pay gap is not the same as unequal pay.
Related Topics. As shown in Figure P, over half In addition to their lower Social Security and retirement earnings, older women also have limited opportunities to earn money in the labor force.
Since working longer later in life yields less than it would for a man DOL , this leaves less room for women to catch up on retirement savings. It also means that when older women are given a choice between staying home to care for family or staying in the workplace, the latter option is relatively less advantageous.
In a recent survey, one-fifth of all women ages 45 to 74 reported that they had taken time off work within the past five years to act as caregivers DOL About 9. In , In , those figures for older women and older men were The unexplained, or residual, portion of the pay gap is the difference in pay between men and women who are observationally identical. It is what is left when researchers control for all observable characteristics.
It is due to factors that are otherwise difficult to measure—which could include not only discrimination but also differences in productivity that are unrelated to influences such as educational level and experience. What can the size and trajectory of this residual gap tell us about the scope of discrimination in the workplace?
Even when researchers control for all observable characteristics, a portion of the gender wage gap is left unexplained. Economists often argue that this unexplained portion, while not synonymous with discrimination, may tell us how much gender discrimination could be affecting wages.
By this measure, discrimination is either stable or increasing. In a study, economists Francine Blau and Lawrence Kahn found that the unexplained portion of the gender wage gap narrowed dramatically in the s, shrinking from between 21 and 29 percent of the gap in to between 8 and 18 percent of the gap in However, after , the unexplained portion of the gap did not narrow any further, and it has remained stable ever since.
Women today have more education and work experience, which has whittled away the influence of those factors on the gap. Human capital factors such as education and experience made up about 25 percent of the wage gap in , but only 8 percent in This residual gap is not uniform across occupations.
Goldin argues that some professions disproportionately reward those who work very long hours, and this might explain why she finds a larger residual gap in business occupations than in science and technology fields. Also some high-wage firms have adopted pay-setting practices that disproportionately reward individuals who work very long and very particular hours, including weekends or late nights.
This means that—even if men and women are equally productive per hour—individuals in these firms who are more likely to work a very high number of weekly hours and be available at particular off hours are paid more. But expansion or contraction of the residual gap does not mean that discrimination is expanding or contracting to the same degree because the residual wage gap only captures discrimination in pay-setting between similar workers.
It does not capture the range of factors that influence the different labor market experience of men and women before employers make hourly pay offers, and discrimination—in the form of society-wide constraints on choices—can certainly enter into these factors. Therefore, controlling for current occupation disguises how discrimination can filter men and women differently into high- or low-paying occupations.
Empirical evidence of outright discrimination in hiring, promotions, and even wage-setting is strong and includes the following:. As noted, the unexplained, or residual, portion of the pay gap is the difference in pay between men and women who are observationally identical.
Some argue that one of the difficult-to-measure factors is differences in productivity that are unrelated to influences such as educational level and experience. Studies that have directly explored worker productivity show little evidence of a motherhood penalty on productivity. Recent research by the Federal Reserve Bank of St. Louis that examined productivity among academic economists found that, over the course of a career, women with children were more productive than women without children Krapf, Ursprung, and Zimmerman Additionally, women with two children were more productive than women with one child.
Another study of blue-collar workers, a group chosen because of the belief that there would likely be productivity differences by gender, found that women were generally as productive as men Petersen, Snartland, and Milgrom The same study found that mothers were seen as less competent than childless women Burgess For men, parenthood status had no effect on their perceived competency.
Another study found both men and women were conflicted by the notion that they should put work before family and other personal affairs Reid Women, however, were much less likely to be perceived as putting work first.
But in fact, for decades, the wages of the vast majority of both men and women have not kept pace with economy-wide productivity as productivity continued to increase but wages largely stagnated. This contrasts with the decades before about , when wage growth and productivity growth were closely linked. If wages had continued to grow with productivity, the vast majority of both women and men would be better off today Figure Q.
Women do indeed make choices, but those choices do not occur in a vacuum. One study found that parents are more likely to expect their sons, rather than their daughters, to work in STEM fields, even when their daughters performed at the same level in mathematics OECD Though girls are underrepresented among students with the highest math test scores, research shows that this gap differs geographically.
In the same states where girls had stereotypically gender-normative test scores, boys scored higher in math than girls but also lower in reading. Other research shows that gender bias among teachers negatively affects girls, with the worst effects for girls in less well-off families and girls whose fathers have more years of schooling than their mothers Lavy and Sands One study found that girls are more likely to express feelings of anxiety over mathematics, and on average their math scores were lower.
But among girls who reported similar levels of confidence as boys, the gender gap in performance disappeared OECD Cultural stereotypes appear to have a direct impact on academic performance OECD Asians, for example, are stereotyped as being good at math.
When Asian girls were told they were taking a quantitative skills test to assess ethnic differences in performance, they scored higher than a control group, which was given no explanation for why they were taking the test. By contrast, Asian girls scored worse when they were told they were taking a quantitative assessment to determine gender differences. Yet STEM majors are associated with the highest earnings.
One study found that as many as half of highly qualified female SET professionals left their jobs because of hostile work environments and job pressures at odds with traditionally gendered domestic roles Hewlett et al. Yet the gender wage gap persists even among recent graduates Gould and Kroeger There seems to be little compelling evidence that this reflects smart economic thinking by employers. For example, productivity suffers for employees in medical fields who work long hours Lockley et al.
Yet these practices persist and affect women. As noted earlier, women in high-wage professions experience a wider gender gap because they are penalized for not working long, inflexible hours. But in the United States and around the world, when unpaid work is accounted for, women do more work than men, reflecting again the social expectation that women disproportionately undertake nonmarket work.
This trend holds even for children: Although girls spend more time doing chores than boys, they are less likely than boys to be paid an allowance University of Michigan Sex segregation in occupations is a reality; women dominate some occupations, just as men dominated others.
However, when women enter male-dominated occupations, they have similar or lower expected wages than their female counterparts who go into female-dominated occupations Pitts This suggests that when women enter female-dominated occupations, they are rationally situating themselves to be paid higher wages once discrimination is taken into account.
Similarly, men choose male jobs to earn relatively more. But Budig and England find little support in the data for this. Finally, the perception that women with children choose to work less is often false. Instead, mothers in the workplace are simply judged more harshly in regard to their employer commitment than women without children.
Correll, Benard, and Paik find that mothers are seen as less committed to the workplace than women without children in comparable jobs. Gender differences in salary negotiation explain a portion of the gender gap. Men are more likely to negotiate their salary, which increases their earnings Babcock and Laschever However, men and women face different social incentives for negotiation, and there is evidence that women are more likely to be penalized when they negotiate Bowles, Babcock, and Lei Evidence also shows that men benefit disproportionately from incentive pay Albanesi, Olivetti, and Prados Female executives receive a lower share of incentive pay relative to their male counterparts, and this difference accounts for 93 percent of the gender gap in total pay Albanesi, Olivetti, and Prados Performance pay also disproportionately rewards male executives.
This research suggests that women are hurt by incentive pay at the top of the earnings spectrum in two ways: 1 women are less likely to be rewarded using incentive pay when they are in high-ranking managerial positions, and 2 they are less likely to reach those commanding heights of the economy where they would receive more of their pay through an incentive-based structure. Only 60 percent of men and 62 percent of women have access to paid sick days Williams and Gault Two disproportionately female groups, low-wage workers and part-time workers, are also less likely to have paid sick leave than their higher wage and full-time counterparts BLS ; Figure R.
Women are less likely than men to receive health insurance through their own job. In , 34 percent of women had employer-provided health insurance, compared with 43 percent of men KFF But equal participation does not mean equal retirement security.
Because of their care responsibilities, women are more likely to move in and out of the workforce. This weakens their earnings power, and as a result, women have less retirement wealth than men, both in traditional pensions and employer savings accounts such as k s.
Women age 65 and older are 80 percent more likely than their male counterparts to be living in poverty Brown et al. And widowed women are twice as likely as widowed men to be living below the poverty line Brown et al.
This publication was made possible by a grant from the Peter G. Peterson Foundation. The statements made and views expressed are solely the responsibility of the authors. The authors would also like to acknowledge the tireless work of Jin Dai, data programmer, and overall guidance of Josh Bivens, research director.
Elise Gould , senior economist, joined EPI in Her research areas include wages, poverty, economic mobility, and health care. Jessica Schieder joined EPI in Prior to joining EPI, Jessica worked at the Center for Effective Government formerly OMB Watch as a revenue and spending policies analyst, where she examined how budget and tax policy decisions impact working families. Kathleen Geier is a Chicago-based writer and researcher.
Wages here refers to the hourly wages of all wage and salary workers between 18 and 64 years old. Throughout we use wage gap and pay gap interchangeably to refer to the wage gap.
The typical woman or man referred to here and throughout is the median female or male worker. Unless otherwise specified, the EPI analyses throughout this piece use data on hourly wages of all workers, not just full-time workers.
Technically, this is an adjusted gender wage gap measure because the weekly or annual gender wage gap would allow hours of work to differ. An hourly wage gap will not capture the direct effect of differences in hours or weeks worked, but it will capture the indirect effect of wage differences due to the effect of hours on hourly wages.
Of course, our answers to questions about the wage gap also draw on the work of other researchers, who may use different measures. Claudia Goldin for example uses earnings of full-time full-year workers. While there is no fatherhood penalty in the data, there is evidence that fathers who take leave are punished as well Bertrand, Goldin, and Katz The median is the value you get if you take a set of numbers, arrange them from highest to lowest, and choose the number that is exactly in the middle.
Technically, the median hourly wage is an adjusted gender wage gap measure because the weekly or annual gender wage gap would allow hours of work to differ. The regression-based gap is based on average wages and controls for gender, race and ethnicity, education, experience, and geographic division. The log of the hourly wage is the dependent variable. Here education is measured on a mutually exclusive five-point scale: workers who have less than a high school diploma, those who have completed high school but no further schooling, those who have some college experience but have not earned a college degree, those who have earned a college degree, and those with advanced degrees.
Here we add in controls for major industry category, detailed occupation four digit , and full-time status. Their more fully specified model adds in a series of industry, occupation, and union coverage dummy variables. For our purposes, parents are those with children under age Women and men are limited in these comparisons to individuals between ages 25 and Children are defined as under age Using female weights gives a lower share of 58 percent.
Using female weights would mean you would move men out of their occupations. Nontraditional occupations are defined by the Carl D. Median weekly earnings for full-time wage and salary workers. The Union Advantage for Women. Arons, Jessica. Center for American Progress. Babcock, Linda, and Sara Laschever. Blau, Francine D. National Institute for Retirement Security. Budig, Michelle J. Third Way Next.
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Unequal Pay Day for Immigrant Women. Golden, Lonnie. Irregular Work Scheduling and Its Consequences. Economic Policy Institute report.
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