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Report: The Gender Pay Gap Costs Women $500B a Year

Topics: Data & Research
gender pay gap
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Women earned 80 cents, on average, for every dollar earned by men in 2017, according to the latest report from the American Association of University Women (AAUW), even though women had greater educational attainment. This gender pay gap costs women $500 billion annually.

AAUW’s annual report, The Simple Truth About the Gender Pay Gap, showed that women earned less than men in every age group, state and almost every occupation.

“While the nation’s unemployment rate is down, and the number of women working is up, the wage gap is sadly remaining stagnant,” said Kim Churches, chief executive officer of AAUW, in a statement. “It’s unacceptable. There is no gender differentiation when it comes to quality, skills and talent.”

PayScale’s report, The State of the Gender Pay Gap, also showed a persistent wage gap. Comparing all women to all men, women earn 78 cents for every dollar earned by men. Even controlling for factors like job title and work experience, women earn only 98 cents on the dollar. And, our data showed that the gap grew worse as women climbed the ladder: the controlled gender pay gap is 98.3 cents for individual contributors, but 94.4 cents for executives.

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The 5 Largest Gender Pay Gaps

AAUW analyzed 114 occupations and found that some were worse than others when it came to the pay gap. The largest collective gender pay gaps were in these jobs:

  • Financial managers, $19.6 billion
  • Physicians and surgeons, $19.5 billion
  • Accountants and auditors, $17.3 billion
  • First-line supervisors of retail sales workers, $14.8 billion
  • Registered nurses, $12.5 billion

The only occupation where women earned more than men was wholesale and retail buyer. In that job, women earned $235 million more than men.

Other Facts About the Gender Pay Gap

Pay inequity affects women across occupations, demographic groups and locations. Per AAUW:

  • The pay gap is smallest for women aged 20 to 24 at 90 cents on the dollar and grows with age. Women aged 55 to 65 earn 78 percent of what men earn in the same age group.
  • Latinas have the largest pay gap, earning 53 cents for every dollar earned by white, non-Hispanic men. Black women earn 61 cents for every dollar earned by white men.
  • The motherhood gap is in effect. Mothers earn 71 cents to fathers’ dollar.
  • The wage gap is largest in Louisiana (69 cents/dollar) and smallest in California (89 cents/dollar).

The pay gap has real effects on women’s lives. Eleven percent of older women (65-plus) live in poverty, compared to 8 percent of older men.

Per AAUW, the gender pay gap has closed less than 5 cents since the turn of the 21st century. At the current rate, it will persist until 2106.

[click_to_tweet tweet=”The gender pay gap has closed less than 5 cents since the turn of the 21st century. At the current rate, it will persist until 2106.” quote=”The gender pay gap has closed less than 5 cents since the turn of the 21st century. At the current rate, it will persist until 2106.”]

How to Close the Gap

AAUW offers several recommendations to close the gender pay gap. In addition to policy changes at the state and federal level, they suggest several efforts that employers and individuals can make to achieve pay equity.

For employers, they suggest conducting pay audits, prohibiting retaliation for wage disclosure and banning the salary history question. For employees, they recommend honing negotiation skills — and learning how to navigate bias:

Traditionally, it has been socially acceptable for men to negotiate for raises because negotiating conforms to the stereotype of men as assertive. But negotiation is especially tricky for women because some behaviors that work for men, like self-promotion and assertiveness, may backfire on women (Carter & Silva, 2011; Bowles & Babcock, 2013). Knowing what your skills are worth, making clear what you bring to the table, emphasizing common goals, and maintaining a positive attitude are some negotiation tactics that have been shown to be effective (Babcock & Laschever, 2008).

To that end, AAUW is offering salary negotiation workshops both online and in cities across the country.

To learn more:

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Jen Hubley Luckwaldt
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