We could have underestimated the pay gap – and work needs to be done to combat it.
We’ve all heard the statistic that women earn around 80 cents (65p) to every dollar a man makes – and it’s a sobering fact.
But new research suggests that the pay gap may be even bigger than we thought.
According to the Institute for Women’s Policy Research, women earn just 49 cents to the typical men’s dollar – “much less than the 80 cents usually reported”.
“Much ink has been spilled debating whether the commonly cited measure of the wage gap — that women earn 80 cents for every dollar earned by a man — is an exaggeration due to occupational differences or so-called ‘women’s choices,’ but our analysis finds that we have actually been underestimating the extent of pay inequality in the labour market,” said report co-author Heidi Hartmann.
When the team measured total earnings over fifteen years, women earned 49% less than men – a gap of 51%. And progress had slowed relative to the preceding 30 years.
“For those who took just one year off from work, women’s annual earnings were 39% lower than women who worked all 15 years between 2001 and 2015, a much higher cost than women faced in the time period beginning in 1968, when one year out of work resulted in a 12% cut in earnings,” the authors explain.
“Women’s earnings losses for time out are almost always greater than men’s.”
This means that improving access to both paid leave and childcare is “critical” to improving things for women, they go on to say. 43% of women had had at least a year out of work with no earnings – twice the rate of men. Policies supporting child care and giving paid family and medical leave could help improve this – and “encourage men to share more of the unpaid time spent on family care”.
“Over the course of the nearly 50 years covered in the study, women have seen considerable progress in the labor force by entering the workforce at higher rates and staying in the labour force for longer periods of time,” he said. “That’s led to higher earnings and a narrower wage gap.”
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