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The Wage Gap and Equal Pay Progress, Part I: How the Wage Gap Developed

by | October 22, 2024 | Employment Discrimination, Gender Discrimination

By Schwanda Rountree, Erica Roberts, and Amira Dehmani

The history of the workforce is painfully clear and consistent: Women have and continue to be paid less than men, creating a gender wage gap. In this series, we will discuss how the wage gap developed, what it has looked like over time, how developments in law have attempted to rectify the equal pay issue, and what the future might hold.

What is the Wage Gap?

When the Equal Pay Act (EPA) was signed into law by President John F. Kennedy in 1963, women earned 59 cents for every dollar a man earned. The EPA was designed to ensure men and women were paid equally for equal work. Today, on average, women are still paid 16% less than men nationally. According to Forbes, Wyoming has the highest wage gap of any state, with women making an average median income that is $18,877 less than men. The lowest gap is in Vermont, but women still make an average median income that is $3,872 less than men in the state.

The 2024 wage gap studied in Forbes also goes beyond median income to include benefits as well; women receive 20% less Social Security benefits than men on average and contribute 30% less than men to their retirement accounts because of their lower pay.

This gendered disparity is seen at every level of the workforce, from entry level to C-suite, and can be seen across nearly all fields. For C-suite executives, women earn 95 cents for every dollar earned by a man when controlling for position, experience, and education; women earn 73 cents for every dollar without these controls.

Nursing assistants, social workers, and special education teachers have the lowest gender gap, whereas real estate brokers, financial managers, and insurance sales managers have the highest (over 55%). In the legal field, men earn roughly 59% more than women — the largest wage gap across industries.

This reality is stark, and not believed to be alleviated anytime soon. In fact, for the first time in over 20 years, the gender pay gap has widened. U.S. Census data shows that median full-time female workers in 2023 earned 83% of what the median male earned; the previous year, women earned 84% compared to male workers. At the current rate, The Center for American Progress estimates that it will take until 2056 to see pay equity.

Why Does the Wage Gap Exist?

Many scholars have attempted to understand why the wage gap exists and continues to persist to this day. There are many theories about what factors contribute to the wage gap:

Education. It was previously believed that education would help solve the gender pay gap. According to the Pew Research Center, “in 1982, 20% of employed women ages 25 and older had a bachelor’s degree or higher level of education, compared with 26% of employed men. By 2022, 48% of employed women had at least a bachelor’s degree, compared with 41% of men.” Over the years, the gap has closed, much of which is attributed to the rising levels of education among women; however, this appears to be stagnating. There continues to be pay disparity between men and women, even those with the same levels of educational attainment.

Devaluation of Women’s Work. From childhood, young children are socialized to believe they are “good” and “bad” at certain things because of their gender. When growing up, this translates into “occupational segregation.” Women are highly represented in education, administrative support, and “care fields,” such as health care and childcare. Men, on the other hand, are highly represented in construction, production, and transportation fields. While there is a pay gap in nearly all industries, fields that are male-dominated tend to have higher-paying wages.[6] In addition, when previously male-dominated fields see influxes in women entering the field, the pay begins to decline. This is known as “occupational feminization,” and scholars have pointed to these fields becoming more flexible and losing prestige as the reasoning for the lowering of wages.

The Motherhood Penalty. Hiring managers are statistically less likely to hire women who are mothers than to hire women without children. In addition, when employers do hire women who are mothers, they often offer lower salaries because of a belief that mothers will be less committed to their positions and require more time off to care for their children. This is coined, “the motherhood penalty.” This is in stark contrast to the “fatherhood bonus” phenomenon, where men are paid more as they are seen to be supporting a family rather than a single individual (see AAUW Fall 2018 gender pay gap report).

Need for Flexibility. There is a history of women being the primary caregivers in their families. In turn, women are more likely to pursue occupations that allow for more flexibility in order to handle such family responsibilities. These positions tend to pay less than more “inflexible jobs,” that require a strict 9 to 5 schedule, even within the same field.

Socialization. A prevailing theory is that women are socialized to not ask for what they deserve during interviews, salary negotiations, and promotions. Men, alternatively, are socialized to ask for what they deserve, leading to a gap in compensation and positions. These initial differences can then lead to future raises and promotions going to men over women, amplifying the pay disparity. What’s more, studies have shown that women who feel underqualified for a role are less likely to apply than men.

Researchers have attributed this to socialized differences among men and women, where men tend to overestimate their capabilities, while women underestimate them — leading to fewer women applying for higher-paying positions when they do not meet all of the criteria.

It is clear that the gender pay gap has been and continues to be a large problem in the United States, and that this gap is attributable to a combination of the theories above. In part two of this series, we will discuss pay discrimination and the intersectional implications of the wage gap.

If you believe that you are experiencing pay discrimination because of your gender, race, disability, or another protected class, please feel free to fill out our online intake form to contact an experienced discrimination attorney at our firm today.

 

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