Women are losing thousands of dollars a month due to the gender pay gap. The pandemic may have made it worse.
March 15 marks Equal Pay Day. It's the amount of time women had to work into 2022 to make the same amount men were paid in 2021 alone.
Women working full-time year round were paid just 83 cents on the dollar compared with men, according to a new analysis by the National Women's Law Center, which looked at the latest data from 2020. But when comparing all women who worked in 2020 with all men who worked, regardless of hours and weeks, women were typically paid just 73 cents on the dollar.
That pay gap is even greater for women of color. While White women typically made 79 cents on the dollar compared to White men, Black women made 64 cents on the dollar compared to White men while Latina and Native American women made just 57 cents.
"It does seem like it's just 17 cents, but it really does add up, and so we're talking 10s of thousands of dollars a year," said Jasmine Tucker, director of research of the National Women's Law Center.
For Asian women, the gender pay gap to White men amounts to $3,000 a year and $120,000 over a 40-year career. For White women, it's nearly $14,000 less in earnings a year, and more than $555,000 over a 40-year career. For Black women, it's more than $24,000 annually and more than $976,000 over a 40-year career. For Native American women, it's $27,000 less a year and more than $1 million over 40 years. And for Latina women, it amounts to making nearly $29,000 less a year, and more than $1.1 million less over 40 years.
The gap also falls across almost all occupations. Women's full-time earnings are less than men's in almost all of the top 20 most common occupations for women and all of the top 20 most common occupations for men, the Institute for Women's Policy Research found.
At the same time, the gap has remained relatively unchanged over the past three decades. From 1979 to 1994, it fell from 37.7% to about 23%, the Economic Policy Institute found. But it has not improved much since, even as women have made great gains in educational attainment – going from less likely having a college or advanced degree compared to men – to surpassing men in education. Women with advanced degrees are paid less on average than men with bachelor's degrees, according to the Economic Policy Institute.
And as women get older, earning power declines. That means the gender pay gap increases substantially for women 45 and above, according to research by Payscale.
The pandemic's impact
When the pandemic hit, both men and women lost their jobs – but women, who disproportionately work in customer-facing service positions, were particularly affected, including being responsible for child care as schools and daycares shut down.
While the number of women working full-time has increased from 2020 to 2021, there are still 1.1 million fewer women in the labor force last month than in February 2020.
The latest numbers may actually look like the gender pay gap shrank by a penny or more depending on the group, but because the latest data is from 2020, it paints a false picture.
"All these millions of jobs and especially among low-paid workers jobs were lost in 2020," said Tucker. But median earnings for both men and women went up in 2020, she said, "because people who remained insulated from the pandemic in terms of job losses tend to be those who had higher wages."
Tucker and other experts suggest that as more women return to work, especially those in lower-paid jobs who've been out of the workforce longer, the pay gap could widen again.
"When you take time out of the labor force, it's hard to come back in at the same level that you left, and because you've been out for so long you might be willing to accept a job that's lower than when you left or with lower wages, and that's going to follow you around," Tucker said. "So putting measures that are going to keep women attached to the labor force are going to help."
Paving the way for more unions could also help shrink the gender pay gap, as women in unions make more than women not in unions, Tucker said. Also, employers can conduct pay audits, and take a hard look at what they are paying workers for the same jobs with the same level of experience.
On Tuesday, the Biden administration announced additional actions to pay federal workers equitably, including a proposed regulation on salary history, as banning the use of prior salary information can help end the cycle of discriminatory pay. President Biden will also sign an executive order to consider limiting the use of salary information in federal contractor employment decisions.
The Biden administration has also touted support for collective bargaining, directing steps to advance equal pay at federal agencies, as well as raising the minimum wage for federal contractors which would benefit women. President Biden has also called for policies like paid family and medical leave and affordable child care to keep women tied to the workforce, but efforts are stalled in Congress.
The wealth gap
The gender pay gap is just one factor contributing to an overall wealth gap. And while the wealth gap is harder to decipher because of marriages and other factors, the wealth gap for single women versus single men is stark.
Women pay higher interest rates on mortgages and are more likely to take career breaks, such as time off to care for family — which leads to White women having just 32 cents for each dollar of wealth a White man has. Black and Latina women have just pennies on the dollar.
Another factor contributing to the wealth gap: a lack of investments, which could cost women hundreds of thousands, if not millions of dollars over their lifetimes, even as they need to save more for retirement than men – because women live longer, and Social Security benefits are based on lifetime earnings.
More than 50% of women ages 55 to 66 have no personal retirement savings compared to nearly 47% of men, according to the Census Bureau. For those who have $100,000 or more in personal retirement, women lag behind men 22% to 30%.
Emily Green, director of private wealth at the financial services company Ellevest, said the male-dominated financial industry simply "isn't there for women," so more women than men just hold onto cash.
"Women are actually better investors than men, which I think people don't realize. When you actually look at both retail women investors but also professionals, like mutual fund managers, hedge fund managers, women actually tend to outperform, really because they do not react to the markets as much."