Women are still paid 83 cents for every dollar men earn. Here’s why

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The “gap” between how much money men and women are paid has long been a feature of the U.S. economy.

While that pay differential has narrowed since the 1960s, progress seems to have slowed in the past decade or more — a dynamic that has big implications for women’s financial security and wellbeing, according to experts.

“What you’ll find is that no matter how you measure it, a pay gap exists,” according to Elise Gould, a senior economist at the Economic Policy Institute, a left-leaning think tank. “It has a huge impact on lifetime earnings,” she added.

Here’s the most clear-cut measure of the disparity: In 2020, women made 83 cents for every dollar earned by men, according to the U.S. Census Bureau. (The analysis measures median wages for full-time, year-round workers 15 years and older.)

Put differently: It would take some 40 extra days of work for women to earn a comparable wage.

Women of color are at an even greater disadvantage. For example, Black women were paid 64% and Hispanic women 57% of what white non-Hispanic men were paid in 2020, according to the U.S. Labor Department.

“There’s a still a significant gap,” according to Richard Fry, a senior researcher at the Pew Research Center. “It hasn’t narrowed a lot in the last 15 years.”

Narrower?

In 1960, the national wage gap was much larger; at that time, women earned 61 cents for every dollar of men’s wages.

Since then, women have made big advancements in both education and work experience, which employers tend to reward with higher pay, Fry said.

Young women are more likely to be enrolled in college than young men, and women over 25 are more likely to have a four-year college degree, according to Pew.

Americans have also seen many changes in U.S. laws and culture — stronger enforcement of pay discrimination laws and shifting expectations and understandings of women in the workforce, according to Emily Martin, vice president for education and workplace justice at the National Women’s Law Center.

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The problem isn’t just that women’s pay continues to lag in aggregate, according to experts. The wage gap persists when comparing women to men across similar education level, occupation, income and race.

In fact, a recent analysis by Gould found that progress has plateaued for over two decades: In 2021, women made about 80 cents for every dollar of male wages, little changed from about 77 cents in 1994, after controlling for differences in education, age, geography, race and ethnicity.

Contributors

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There are three major contributors to the ongoing pay discrepancy: job type, discrimination and shouldering caregiving duties, Fry said.

For one, women are overrepresented in low-paying service jobs relative to men. That’s especially true of care work, like childcare workers, domestic workers and home health aides, according to Sarah Jane Glynn and Diana Boesch, policy advisors at the U.S. Department of Labor.

But the wage gap isn’t attributable just to jobs that a woman might choose. Even within female-dominated jobs, women are paid less than men, on average, Glynn and Boesch wrote. Average pay within occupations also tends to fall when women enter in large numbers because their labor is so “devalued,” they added.

Further, about 42% of working women have experienced gender discrimination at work, nearly twice the number of men, according to a 2017 Pew survey.

That included earning less money, being treated as if incompetent, being passed over for promotions and important assignments, and receiving less support from senior leaders, for example.

‘Penalized’

Women also get “penalized” as they age and generally assume more family caregiving responsibilities relative to men, which might cost them valuable time in the workforce, Fry said.

Research suggests women start their careers closer to wage parity with men.

In 2019, women under age 30 were paid 93% of men’s wages nationally, much higher than the 82% share for all women, according to the Pew Research Center. In 22 U.S. cities metropolitan areas (including New York, Washington, D.C. and Los Angeles) young women made the same or even more than men that year.

But history suggests the gap will widen.

In 2000, the typical woman 16 to 29 years old working full time and year-round earned 88% of a similar man’s wages. By 2019, when they were ages 35 to 48, women were earning just 80% of their male peers, on average, according to Pew.

“Their advantages and compensation relative to men is narrowest earlier in their careers,” Fry said. “Whatever parity they currently experience may not last as they age.”

Wealth

This isn’t to say all women make less than men. There isn’t an earnings gap in a small subset of occupations, like phlebotomists, electricians and social workers, according to the Census Bureau.

But in aggregate, the pay gap contributes to less overall wealth for females.

The wealth gap is harder to measure than pay, since wealth is often measured at the household (not individual) level. But a 2021 study by the Federal Reserve Bank of St. Louis, which looked at female-headed households relative to male-headed ones, found the typical woman had just 55 cents for every dollar a man had.

Continuing to close the gender wage gap largely depends on public-policy changes to improve structural issues, according to Martin: investments in childcare infrastructure, paid family and medical leave, higher minimum wages and stronger equal pay laws, for example, she said.

There’s been some traction toward pay equity: Nearly two dozen states and an equal number of cities have banned prospective employers from asking applicants questions about pay history, for example, according to the website HR Dive. (Some states have gone the other way, by forbidding such bans.)

Individual action and attitudes can help influence change, too, Martin said.

That might include trying to break down barriers around pay secrecy: by demanding an employer be more open to sharing details and decision-making related to pay in the workplace, she said.

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