What Is the Wage Gap?

What Is the Wage Gap?

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The wage gap makes headlines every year.

In 2018, women made 82 cents for every dollar earned by men. That adds up to a loss of $10,000 in earnings each year or more than $400,000 over the course of a 40-year career.

To put it another way, women have to work for 15 months to make what men earn in 12 months. Equal Pay Day, commemorated on March 24, marks the day women need to work until to earn the same pay that a man makes by January 1.

But equal pay day isn't the same for all women. Black women have to work until August 3 and Latina women have to work until Oct. 21 to earn the same amount.

The gender wage gap is a major problem, but it isn't the only wage gap. Let's explore what the wage gap is and what causes it.

Gender Wage Gap

The gender pay gap is the difference between the average wages for women and men. Overall, women earn 82 cents for every dollar earned by a man.

However, the wage gap differs greatly depending on the woman's race. Compared to every dollar earned by a white man, white women earn 79 cents, while Black women make just 62 cents, and American Indian women earn 57 cents. Latina workers earn only 54 cents compared with every dollar earned by a white man.

Much of the wage gap comes from differences in job titles and industries. For example, women tend to work in lower-paid industries than men. Yet even when accounting for industry, title, experience, and other factors, women still earn less than men.

In many industries, the gender pay gap persists even when men and women work the same job. For example, female general practitioners earn 94 cents for every dollar earned by a male general practitioner, and women in anesthesiology make just 83 cents to every dollar earned by men.

Even fields dominated by women show a gap. Women make up 90% of nurses, yet they earn 98 cents for every dollar earned by a male nurse. In education, women make up the majority of elementary school teachers, but they only earn 92 cents to the dollar earned by their male counterparts.

Professionals with the same degree also experience gender pay gaps: Women with MBAs earn 75 cents compared to men with an MBA.

As women advance in their careers, the pay gap grows. At the executive level, women earn 69 cents to every dollar earned by men.

Race Wage Gap

The wage gap isn't just a problem for women. People of color also earn lower average wages than white workers.

In 2015, a Pew Research Center report found that white men with a bachelor's degree earn an average of $32 per hour, while Black men with a bachelor's degree earn $25 per hour and Black women with a bachelor's degree earn $23 per hour.

This race wage gap has persisted for decades. In 1980, Black men earned 73% of white men's wages — and 73% in 2015.

Women of color face the largest wage gap, and they lag behind white women in closing the gap. Since 1988, white women have closed the wage gap by 23%, while the wage gap for Black women closed only 7%, and Latina women closed the gap just 4%. At the current pace, Latina women won't achieve pay equity until 2451.

The pay gap for women of color also increases with education. Black women and Latinas with a bachelor's degree see larger wage gaps between their pay rates and white men with the same education level when compared with the same demographics with only a high school diploma. Native American women also face a larger wage gap after they complete a bachelor's degree.

Wage Gap Among Workers With Disabilities

In the U.S., around 9 million workers identify as disabled. While the Americans with Disabilities Act protects these workers from pay discrimination, many still experience lower wages than non-disabled workers.

Workers with disabilities earn less than their non-disabled colleagues — a wage gap that amounts to $141 billion in lost wages each year. Comparing full-time workers, the U.S. Census Bureau found that those with a disability earn 87 cents to every dollar earned by those without a disability.

Overall, American Institute for Research data reports that people with disabilities earn 37% less than non-disabled workers. And as people increase their education, the gap widens. People with disabilities also faced a higher unemployment rate than their peers, even with a college degree.

Wage Gap Among the LGBTQ+ Community

It's hard to measure the LGBTQ+ wage gap in part because the Census Bureau, which tracks data for all sorts of groups, does not ask about sexual orientation or gender identity. However, other data sources show that LGBTQ+ workers face many of the same barriers that contribute to a pay gap for other groups.

According to a 2015 survey, LGBTQ+ workers earned 15% less than their straight and cisgender colleagues. That same year, a different survey showed that nearly one in three transgender people lives in poverty.

What Causes the Wage Gap?

What contributes to the pay gap for women, people of color, people with disabilities, and LGBTQ+ workers? A large part of the gap comes down to choices in degree, field, and experience. Women often choose lower-paying fields than men, people with disabilities tend to work fewer hours, and women are more likely to experience a gap in their work history when having children. When controlling for these factors, however, the wage gap persists in many areas.

The pandemic exacerbated the wage gap by forcing more women and people of color out of the workforce. In 2020, women left the workforce because of childcare demands at three times the rate of men.

And these choices — about majors, industries, and careers — do not take place in a vacuum. For example, women may choose a lower-paying field for greater job flexibility to support their male partner's career or to balance childrearing with work.

In tech, for example, women face hurdles during their education, since men dominate in STEM majors. After earning a degree, women in tech have fewer mentors and role models. They also face harassment and discrimination in the workforce: In 2018, nearly 40% of women experienced sexual harassment at work.

The same barriers prevent women of color from entering higher-paid industries. Women of color disproportionately work in the lowest-paying industries. Over 60% of housekeepers and maids are women of color, as are 54% of home health aides.

Raising the minimum wage would help women of color close the wage gap. Nearly 60% of workers earning less than $15 an hour are women, and they are disproportionately Black or Latina.

Equal pay laws require equal pay for equal work. So why do women and people of color earn less for the same work? Discrimination helps explain the persistance of pay gaps even after accounting for differences in education and job titles. A 2017 survey found that 42% of women faced gender discrimination at work, with 25% reporting earning less than a man for the same job.

What Can You Do About the Wage Gap?

The wage gap is a structural problem in the United States, and individuals only have so much power to combat it. However, people can take a few steps to fight for salary equity.

First, it's important to know your rights. Federal laws against compensation discrimination protect women, people of color, and other protected groups from making less money because of their sex, race, age, and other factors.

Second, job candidates and workers need to research salaries in their field when looking for a new job. Information is key when advocating for your worth.

Third, pay transparency helps combat the wage gap. Simply talking to coworkers about compensation can give workers hard data to use when advocating for pay equity in the workplace. Federal laws also protect people from retaliation if they complain about pay discrimination.

Finally, ending the wage gap will take structural change, so stay active politically and advocate for policies that help everyone earn equal pay for equal work.

Image of author Genevieve Carlton

Genevieve Carlton holds a Ph.D. in history from Northwestern University and earned tenure as a history professor at the University of Louisville. An award-winning historian and writer, Genevieve has published multiple scholarly articles and a book with the University of Chicago Press. She currently works as a freelance writer and consultant.

Header Image Credit: Martin Barraud | Getty Images