Equal Pay Day- What Causes the Gender Pay Gap?

What is Equal Pay Day?

Equal Pay Day falls on Tuesday, March 12, 2024. Equal Pay Day is a symbolic day that represents how far into the year women must work to earn what men earned in the previous year. In other words, it shows how wide the gender pay gap is in our society. The gender pay gap refers to the difference between the average earnings of men and women who work full-time. It is a persistent issue that affects women in every industry and at every level of seniority.

According to a Payscale report, women working full-time are paid, on average, 83 cents for every dollar earned by men. The wage gap for African-American women and Latinas is even worse, and additional factors like motherhood and single-parent status compound the effect.

This wage gap cannot be dismissed entirely as the by-product of “women’s choices” in education, career, and family matters. Recent studies show that even when you account for these differences, there still is an unexplained gap between men’s and women’s earnings. Furthermore, reducing the issue down to “women’s choices” disguises the fact that these “choices” are often driven by structural inequality.

Reasons for the Gender Pay Gap

1. The Second Shift

One of the reasons for the gender pay gap is the second shift of domestic responsibilities. Women are often expected to take care of their families and homes, in addition to working full-time jobs. This means that they have less time to dedicate to their careers, and are often passed over for promotions or career development opportunities.

The lack of affordable and accessible childcare also plays a part in the gender wage gap. With women shouldering the majority of caregiving responsibilities in the home, it can be difficult to balance work and family. Without access to affordable childcare, many women may be forced to choose lower-paying jobs, work part-time, or leave the workforce altogether.

2. Barriers to Career Advancement

In addition to the second shift of domestic responsibilities, the gender pay gap is also caused by systemic barriers, such as bias and discrimination, that women face when trying to advance to higher-paid leadership roles. According to a survey by Lean In and McKinsey, women are significantly less likely than men to be hired into manager-level positions and are more likely to hit a “broken rung” on the career ladder, which can stall their career progression. These barriers can limit women’s access to career advancement and result in lower salaries over time.

In addition, women may also be more likely to work part-time or take time off from work to care for children or elderly family members. While these choices may be necessary for family reasons, they can also limit women’s earning potential over time. Women who take time off to take care of their families are frequently penalized in their careers, being passed over for promotions and important projects as they are perceived as being less hard-working or dedicated than their male counterparts.

3. Occupational Segregation

Women are more likely to work in fields like education, healthcare, and retail, which tend to have lower salaries and fewer opportunities for career advancement. This trend is rooted in systemic barriers and social norms that have historically limited women’s access to education, training, mentorship, and networking. 

Social stereotypes and bias also play a role here—traditionally, women have been seen as nurturers and caregivers. Girls may be discouraged from pursuing careers in law, finance, and STEM due to stereotypes and bias, which can limit their access to high-paying jobs in these fields. Higher-earning industries also tend to expect long work days, which makes these jobs less attractive to women who often have caregiving responsibilities outside of work and prefer more flexible scheduling.

4. Outdated Equal Pay Legislation

Another issue contributing to the gender pay gap is the lack of legislative action on gender equality. While the Equal Pay Act of 1963 made it illegal to pay men and women differently for the same work, the reality is that the law hasn’t been updated in 60 years and women are still paid less than men in many cases. Managers can still get away with paying women less by framing compensation as “commensurate with experience” or “merit-based”, which are subjective decisions often unconsciously influenced by gender bias. 

5. Gender Discrimination by Employers

Much of the gender wage gap can be explained by the different circumstances women and men face—for example how women are discouraged from pursuing high-paying careers, how women are kept out of leadership roles, and how domestic responsibilities cut into the time women can devote to their careers. 

But, even when you account for these differences, there’s still a pay gap that exists for men and women performing the same work. This gap can only be explained by pay discrimination—employers undervaluing their women workers simply because of their gender.

For example, a 2021 study found that in the field of computer programming, women programmers made 96 cents to the dollar compared to men. Four cents may not sound like much, but that’s $65 out of a weekly paycheck, meaning she got paid $3,380 less over the course of a year—for the same job.

Gender Pay Gap Variables

The gender pay gap is not just a problem in the United States. In fact, the gap is worse in other parts of the world. According to the World Economic Forum’s Global Gender Gap Report, the equality gap between men and women worldwide has hovered around 68% for years. The report found that progress toward gender equality has been slow, with the global gender pay gap expected to take another 132 years to close.

The gender pay gap also varies depending on age and race. According to the National Women’s Law Center, women over the age of 65 earn only 80 cents for every dollar earned by men in the same age group. For women of color, the gap is even wider. Black women earn only 63 cents for every dollar earned by non-Hispanic white men, while Latina women earn only 55 cents for every dollar earned by non-Hispanic white men.

Additional factors compound the effects of the gender pay gap such as disability and parental status. Women with disabilities are more likely to experience unemployment or underemployment, and are often paid less than their male counterparts with disabilities. Studies have shown that women who have children tend to earn less than women without children, often referred to as the “motherhood penalty.” This is due to a number of factors, including interruptions to women’s careers as they take time off to care for children, the need for flexibility to manage childcare responsibilities, and employer bias against mothers.

What Can We Do to Solve the Gender Pay Gap?

The gender pay gap is a complex issue that requires both individual and systemic action. While women can take steps to negotiate higher salaries and advocate for themselves in the workplace, legislative action is also necessary to create a level playing field. 

1. Create Legislative Change

The Paycheck Fairness Act, introduced several times to Congress but not yet passed, would be an important step towards closing the gender wage gap. The Paycheck Fairness Act would strengthen existing laws, increase transparency around pay practices, and address the culture of secrecy around pay. The Equal Rights Amendment (ERA) would also provide a constitutional guarantee of equal rights for all Americans regardless of sex, which could help to close the gender pay gap.

2. Increase Access to Education and Opportunities

In order to address these barriers and close the gender pay gap, it is important to promote greater diversity and equity in all industries. This includes initiatives to increase representation of women in leadership positions, provide mentorship and support to women pursuing high-wage professions, and work to eliminate bias and discrimination in the workplace.

One example of how this is happening is through nonprofits programs dedicated to empowering women and girls, like Soroptimist International of the Americas’ Dream Programs. The Live Your Dream Awards invests in helping women complete their higher education, with particular attention given to women who have faced obstacles like domestic violence, single motherhood, homelessness, and addiction. Dream It, Be It equips teenage girls with the confidence and tools to plan their future career success.

3. Address the Second Shift

Policies like paid parental leave, flexible work arrangements, and affordable childcare can help to address the second shift of domestic responsibilities that can limit women’s earning potential over time. Couples can also work toward more evenly sharing responsibility for domestic and caregiving tasks. To challenge traditional gender roles, boys and girls should be encouraged to develop skills in all areas, and children should be taught that household tasks are not gender-specific.

By taking these steps, we can create a more equitable and just society, where all individuals have the opportunity to reach their full potential and earn a fair wage for their work.

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