The Lived Reality of the Gender and Race Wage Gap

In the U.S., women are paid 77 cents to every dollar earned by their white, non-Hispanic male counterparts—a staggering pay discrepancy that can add up to an average of $11,782 annually. Moreover, the gap tends to widen throughout a woman’s working life, meaning they lose millions of dollars by the time they retire, a milestone for which they likely weren’t even able to save adequately. Better Life Lab’s Julia Craven spoke with Jessica Stender, the policy director and deputy legal director for Equal Rights Advocate, a civil rights organization focusing on gender justice and women’s rights, about the reality of this gap and what it will take to eliminate it. This interview has been edited for length and clarity.

Julia Craven: Let's start with an overview of the gender wage gap as it exists currently.

Jessica Stender: When we talk about the gender wage gap, we're usually talking about an aggregate number of a certain amount of cents per dollar that women, on average, earn compared to their male counterparts. We calculate that by looking at annual U.S. Census Bureau data on the earnings of US workers. Traditionally the gap was calculated based on full-time, year-round data for working women versus men.

For women versus men, not considering race or ethnicity, women, on average, are paid 77 cents for every dollar paid to men. That's for full-time workers, part-time, and seasonal. If you look at only full-time, year-round workers, women are still, on average, paid just 84 cents for every dollar paid to men. It adds up to actual, significant losses for women and the families they often support. 

For women of color, the gap is much larger. We, as a broader pay equity community, decided to use a second calculation to be more inclusive of all workers for whom data is collected. So that's year-round, part-time, and part-year or seasonal workers. And what's very troubling is that 60 years after the federal Equal Pay Act has passed and many years after state laws have been passed to ensure that women are paid equally as their male counterparts, we still see a huge wage gap for all women, but even larger and particularly harmful [gaps] for women of color.

That’s troubling. Tell us more about these demographics that are commonly glossed over in these conversations, such as women of color, part-time workers, mothers, and LGBTQIA+ workers?

What's incredibly troubling is that most women of color experience a larger wage gap than women overall. That's not surprising to many, given that women of color often experience intersectional discrimination based not just on sex but race, ethnicity, or other protected bases. In terms of the numbers, AANHPI* women overall have a slightly smaller wage gap than women overall, at 92 cents for full-time, year-round working women compared to their white non-Hispanic male counterparts, and 80 cents for all earners. This is slightly better than the 77 cents for women on average. However, in the AANHPI community, that's an overall number. Specific subgroups of AANHPI women—such as Cambodian women, moms, and others—have much larger wage gaps. *(Note: AANHPI is the acronym for people who identify as Asian American and Native Hawaiian/Pacific Islander.)

Full-time working Black women earn just 67 cents to the dollar as compared to their white, non-Hispanic male counterparts. For all earners, [including part-time and seasonal] Black women earn just 64 cents. Full-time working Latinas earn just 57 cents to the dollar; for all earners, it goes down to 54 cents. For Indigenous women, it's 57 cents for full-time, year-round workers and then down to 51 cents for all earners. These numbers are incredibly troubling because of the impact that these gaps have on women and their families.

Also, Census Bureau data on LGBTQ+ workers don’t exist. That’s partly why there’s an Equal Pay Awareness Day for LGBTQIA+ people on June 15 and other marginalized groups. Some groups, like Human Rights Campaign, have collected some data, but we want to make sure that we have more government-collected data on those groups as well.

I like to emphasize to people learning about these divisions where these inequities appear in our daily lives. So how is the pay gap evident in the day-to-day?

Women employed in the U.S. lose a combined total of almost $1.6 trillion every year to the wage gap. They have less money to support themselves and their families, invest in their future, and spend on goods and services. If this annual gender wage gap were eliminated, on average, a working woman in the U.S. would have enough money for approximately 14 additional months of childcare, more than one year of tuition and fees for a four-year public university, almost eight additional months of premiums for employer-based health insurance, and nearly 74 weeks of food.

Women experience higher poverty rates in the United States, and really important research out of the Institute for Women's Policy Research and other entities has found that if the wage gap were eliminated, it would cut the poverty of women and families in half.

The wage gap contributes to the even larger wealth gap that women, particularly women of color, face. They are not able to save for retirement. They're unable to have a safety net if, for example, they or their families need medical treatment or have an emergency that they need to attend to; it's more difficult to save because they're earning less than they should be.

Better Life Lab is big on solutions. What is needed at the local, state, and federal levels to help eradicate the pay gap?

There are many different contributors to and drivers of the gender and race wage gap. So there's not one single reason for the gap, which means there is no single policy fix. One of the different contributors is intentional discrimination. There are still issues of unconscious bias that affect employers, managers, and supervisors in terms of who they deem “appropriate” for certain roles or promotions. This means the traditional reliance of employers on prior salary for pay determination allows pay discrimination to follow a woman from job to job.

Another huge contributor to the wage gap is occupational segregation. Women are still over-concentrated in minimum-wage and low-wage industries. Even within companies, women, particularly women of color, are concentrated in lower-paying jobs and underrepresented at the top. The lack of adequate access to affordable childcare, paid family leave, and other adequate supports for working families often disproportionately impacts women since the burden to fill that gap in our care economy typically falls onto women. So women more often have to take time off work to care for a child or another family member, which then depresses their earnings over time.

Many states are passing stronger equal pay laws than those at the federal level to better combat pay discrimination. Some states expand it beyond sex and require equal pay for equal work for people of different races. Seventeen states and Puerto Rico have instituted prohibitions on employers asking candidates what their prior salary was and relying on it. If the worker wants to talk about that, and thinks that will help the negotiations, they can. We also need more laws raising the minimum wage and mandating salary transparency.

Even though women, on average, make less money per hour than white, non-Hispanic men, white and Asian women are much closer to parity than Black and Hispanic women. The gap widens for LGBTQIA+ workers who are of color, transgender, or non-binary. Would policies addressing intersectional discrimination help remedy this reality within the pay gap?

Other key policy initiatives that are important to highlight are those that respond to occupational segregation and raising the minimum wage. Another is requiring employers to report their pay data, which has been passed into law in California and, to some extent, in Illinois. (Note: The Illinois law only applies to private employers with over 100 employees.)

We love a big-picture positive vision to strive for at the Better Life Lab. Based on your work and expertise, what does an America with no gender and race wage gap look like? What opportunities are available? How are people able to thrive?

Oh, I love that question. I feel like we get so in the weeds that we lose it. But a country without a wage gap would look like one where poverty would be cut in half for women and families. It would be a country where women and their families are able to afford not only basic necessities like rent, food, diapers, and utilities but have the ability to put money away for education or to invest in their retirements.

Our mission is to eradicate the gender and race wage gap precisely because it will enable women and families to lead economically secure lives. And that's not just a benefit to women and families; it benefits the overall economy.