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Money Culture

The Widening Gender Pay Gap (and What to Do About It)

Women make 83 cents for every dollar men make. Learn why the gender wage gap exists, and what can you do to help close it.

Catherine Hiles • September 8, 2022

In This Article

  1. How much do women make compared to men?
  2. Cause of the gender pay gap: caregiving duties
  3. Cause of the gender pay gap: discrimination
  4. Cause of the gender pay gap: job types
  5. What can we do about the gender pay gap?
  6. Final thoughts

It’s no secret that women generally make less than men. And in recent years, women have been leaving the workforce in larger numbers. 

The number of women without high school diplomas in the workforce decreased by 12.8% from Q3 2019 to Q3 2021. Comparatively, the workforce’s number of men without high school diplomas decreased by 4.9%. And women at other education levels have left the workplace in higher numbers than their male colleagues, widening the gap even further. 

To better understand the gender pay gap and how we can close it for good, let’s look at how we got here and what we can do about it.

How much do women make compared to men?

From 1930 to 1950, women entered the workforce in larger numbers after historically having stayed home to care for their families. In 1960, they earned 61 cents for every dollar earned by men. As women became more representative of the labor force, the gender pay gap became smaller, but in 2020, women still made less – 83 cents for every dollar earned by men, according to the U.S. Census Bureau.

Women of color see a more significant pay gap than their white peers. The U.S. Department of Labor reports that Black women earned 64 cents for every dollar earned by men, and Hispanic women earned 57 cents. 

The gender pay gap isn’t as pronounced for young women entering the workforce. In 2019, women under 30 made 93 cents for every dollar their male colleagues earned. An analysis of 2020 Census Bureau data by the Pew Research Center found that young women earned as much or more than their male counterparts in 22 metro areas. But as women progress in their careers, that gap will likely grow as they assume more family caregiving duties.

What can you do about the gender pay gap? One of our financial wellness tips from successful women is to ensure you’re getting paid fairly in your place of work. But putting this into practice is easier said than done.

Cause of the gender pay gap: caregiving duties

The U.S. doesn’t guarantee paid parental leave to employees. But many companies recognize the value of paying parents to stay home and recover from childbirth or bond with their newborns. Unfortunately, women who have children can be disadvantaged when it comes to fair wages.

Many women choose to leave the workforce after having children. This move can negatively affect their career prospects, as many hiring managers frown upon gaps in an applicant’s resume. 

The COVID-19 pandemic exacerbated the number of women leaving the workforce. With kids learning from home, many women quit their jobs to care for their children. 

Even after schools reopened, it became more difficult to find childcare. The pandemic shuttered almost 7,000 childcare centers nationwide between 2019 and 2021. Those that remained open had long waitlists, and prices increased due to higher demand and inflation. Many women had to work from home with their children (if that option was available) or stay out of the workforce until they could find affordable care.

Women typically assume an unequal amount of caregiving at home. Women spend around 2.5 times longer than men on unpaid work and caregiving. That can make women less available to take on extra work than men, leaving them tailing their male colleagues regarding promotions and other opportunities at work.

Cause of the gender pay gap: discrimination

Women may face pregnancy discrimination in the workplace (even though it’s illegal). Pregnancy discrimination has many forms, including:

  • Employers refusing to make temporary accommodations
  • Pregnant people being denied promotions 

Women who take maternity leave can face discrimination when they return to their jobs. Often, they might lose out on a promotion or opportunity because they were on maternity leave. Even after returning to work, women who breastfeed must take regular breaks to pump milk, which employers may view negatively. 

Even without children, women face discrimination at work. A whopping 42% of women reported experiencing gender discrimination in the workplace, according to a 2017 Pew Research Center study. Their experiences included lower pay than their male peers and missing out on promotions.

Cause of the gender pay gap: job types

Another contributor to the pay gap is the types of jobs women have compared to men. A disproportionately high number of women are in low-paying jobs.

For example, the Economic Policy Institute found that in 2019 (the latest year for which data is available), women made up 95.5% of house cleaners and 88.8% of agency-based home care workers. While men work in those industries, they might make more than their female coworkers.

Women who work in higher-paying professions still find themselves at a pay disadvantage. According to data from UN Women, only 5% of Fortune 500 CEOs are women. Though female candidates often qualify for these positions, men get more offers for high-paying jobs than women.

What can we do about the gender pay gap?

If you’re feeling discourage, know there is hope for an equal future. The following actions can help reduce the stigma around salary discussions and encourage your company to be more supportive of female workers.

Employees can have open discussions about salary with their coworkers

To promote equal pay, we must have transparent conversations about salary with our peers. Society has made us believe that discussing wages is rude, but that needs to change.

Start talking to your co-workers to see what they make compared to you. Some may be uncomfortable with the discussion, so you may start with your most trusted colleagues and work up to others. If you notice a disparity, you can make a plan to discuss a raise with your boss.

Both men and women can benefit from discussing salary. Women can’t bear the brunt of the work; male allies can step up and work to correct any gender wage gaps within their companies.

Companies can invest in training and promoting women leaders

White men dominate C-suites around the world. In 2021, 86% of Fortune 500 CEOs were white men, according to data gathered by the Society for Human Resource Management. To help women get ahead and succeed like their male colleagues, companies can provide resources to women to help them advance in their careers. 

Offering opportunities such as leadership training sessions and special projects to women can help them grow in the workplace. Companies should also ensure women know they’re encouraged to apply for promotions when available. 

Companies can adopt practices that don’t disadvantage women who take maternity leave

A 2018 Harvard Business Review study found that women taking longer maternity leaves faced a disadvantage when returning to work. Employers often overlook women who take extended maternity leave for promotions and pay raises. These women may even be fired or demoted. Luckily, the study had some recommendations companies can implement to counteract this.

First, managers can write recommendation letters for women applying for promotions. Letters should list the woman’s accomplishments and strengths, projects she has worked on, and their outcomes. A recommendation like this can help counteract the extended maternity leave gap on the woman’s resume to give her an equal chance with other applicants.

Second, companies can consider a “keep-in-touch” policy. These policies have been tested in Canada and Australia and proved effective. When a woman takes lengthy maternity leave, the company designates an employee to stay in touch and update her on projects, clients, and coworkers. This policy is relatively new but could be helpful for a company to support women’s careers.

Companies can be more flexible with their employees to support working parents

Women might lose their jobs due to inflexible scheduling. Mothers may find it hard (if not impossible) to find reliable childcare if they have an unpredictable work schedule. The gender wage gap can become more pronounced when these women leave the workforce.

Employers can be more flexible regarding scheduling and time off – especially for female employees with children. Some states and cities already have legislation to give workers the right to request flexibility from their employers. Companies across the country can look into adding similar flexibility for their employees, even if not required by law.

Final thoughts

Knowing that there is a gender pay gap is one thing. Discovering you earn less than your male counterparts at work is another. Even if you feel confident that your company pays you a fair salary, it’s essential to ask questions and discuss issues with coworkers and managers to help close the gap. why

Get the conversation started – find out how to talk about your salary at work.

 

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