The Cost of Being a Woman: A $1.6 Trillion Yearly Wage Gap

Despite some progress on the gender wage gap, women still make less than men, with women of color suffering the most.

Mar 14, 2024

pexels-christina-morillo-1181516 — Christina Morillo // Pexels

By Bria Overs, Word in Black

On this year’s Equal Pay Day, there’s little to celebrate. Although women now earn more than ever have, the gender wage gap persists. And they’re feeling the pain in this current economy and political climate.

In 2023, women earned, on average, 21.8% less than men, according to the Economic Policy Institute. While that’s better than 2022, where women made 22.9% less, it’s not necessarily because jobs are starting to pay better — and higher education and self-advocacy only improved wages so much. The EPI found that the pay improvement is likely because men’s wages have stagnated.

Research from the National Partnership for Women and Families found that women lose $1.6 trillion yearly because of the wage gap. “That’s a lot of money that we want in the pockets of women and their families,” Jocelyn Frye, president of the organization, says.

For Black, Latina, and Indigenous women, the wage gap problem is compounded by racial and gender discrimination, along with occupational segregation. These factors not only contribute to pay disparity with white men, but also Asian women and white women. Because of the type of jobs these women work, many of which are hourly positions with little to no options for retirement savings, health insurance, and other benefits, this pay discrepancy adds to the racial wealth gap for each racial and ethnic group.

Frye adds that Black and Latina mothers, in particular, are more often the primary or sole breadwinners of their families, making them the “key to economic stability for their families.”

“When you ensure that they can participate in the economy equally, then they will do better, and their families will do better,” she says. “We know that centering women of color and the economic narrative is really critical to the economic growth of our families and our nation.”

The Wage Gap and Reproductive Justice

When women enter motherhood, they are hit with the “motherhood penalty” — a unique phenomenon where women see a decline in their earnings that can last the rest of their working years.

But beyond that, since the Supreme Court overturned Roe v. Wade in June 2022, several states have made women’s reproductive health a legislative target. So far, 14 states have banned abortions, while 11 states have gestational limits between six and 22 weeks, according to KFF.

“Many of the attacks we see, we believe, have multiple effects as we’ve seen across the board,” Frye says. “It’s not just about abortion, it’s access to IVF, access to OBGYN care writ large, it’s maternal health. All of those things affect the economic stability of families.”

Businesses Could Help Solve the Gap

Both Frye and the Economic Policy Institute believe federal and state policymakers should do more to close the pay gap. In 2017, the Trump administration suspended an Obama-era wage gap initiative that required companies with 100 or more employees to confidentially report to the Equal Employment Opportunity Commission (EEOC) what they pay employees, categorized by job type, sex, race, and ethnicity.

The Salary Transparency Act and Pay Equity for All Act were introduced in Congress in March 2023, but there has been no movement in the year since. States like California, Maryland, and New York have passed laws requiring salary ranges on job postings.

However state efforts only partially solve the pay gap issue because women could easily fall on the lower end of the salary range. Besides, some employers still ask for previous pay history, making it more challenging for women to negotiate pay that reflects their worth.

While the nation waits for legislation, business owners can help with this issue by examining and addressing how they pay women in their workplaces.

“We really have to rely on employers to do their own due diligence and to include race and gender into the analysis they do because many will say they are looking at their gender pay gap, but then won’t look deeper,” Frye says. They should “look at how they’re enforcing and ensuring they’re looking at their workforce on a regular basis to minimize inequality.”