Some Good News On Pay Equity

The United States Department of Labor released a report this week on women in the workforce, including new information on pay equity. American women under 35 who work full time earn approximately 90% of what their male counterparts earn. But as a woman’s age increases, so does the disparity in pay. Women over age 35 earn only about 75% as much as their respective male counterparts.

The data used in this chart are for all full-time wage and salary workers. Notably, they do not control for the different types of jobs men and women might have. In decades past, pay inequity was often blamed on the fact that women tended to be disproportionally represented in lower-paying service jobs or lower-paying professions like teaching or nursing, which, of course, was due in large part to gender discrimination (although the anti-feminists always protested “But women prefer those jobs, and anyway, they’re better at them!”)

That form of discrimination seems to be tailing off, although there are still residual effects:The New York Times wrote:

The different mix of jobs that women versus men go into — which helps explain a large part of the wage gap across the board — may also have changed in recent decades. Unlike in the past, women today claim the majority of college diplomas awarded; perhaps that means that women today are going into higher-skilled (and higher-paying) jobs. Additionally, women workers at most levels of educational attainment earn more than their equally educated peers from a generation ago.

The data tell us that women starting their careers today will probably suffer less gender-based pay inequity than women of the Baby Boom simply because they are starting on a more level playing field, salary-wise. The New York Times noted:

There are many potential explanations for the fact that the gap generally widens with age.

For example, older women may have entered the work force at a time when inequity in pay between the genders was more acceptable. Thus, even though more protections may exist today against outright pay discrimination, older women may have started from a lower salary base and, despite raises, will never catch up.

However, there are other factors that may account for the difference in what younger women and older woman earn:

So what happens around age 35 that seems to shift women onto a different pay track?

Women who are older are probably more likely to have dropped out of the labor force at some point to have children, and years spent away from the job reduce an employee’s potential pay. Plus, perhaps age 35 is around the time when employers start seriously looking at workers for potential promotion to higher-paying jobs, like management positions.

Even more affirmation of what we’ve known all along: the U.S. needs better parental leave policies and elected officials who value work-life balance (like Sweden’s, ideally) so that women don’t lose money or professional advantage simply for having families.

Additionally, I’d suggest that the disparity might be due to the fact that in a struggling economy, more senior, highly-paid employees who are laid off—both male and female—are often forced to take a pay cut when they find new work, which can permanently lower their income. Since older women’s salary histories were lower to begin with, taking a pay cut only exacerbates the inequality in income. I also agree with the commenter who suggested some of the disparity might be because:

Around age 35 women start losing that “youthful” appearance. Sigh.

Yes indeed. Ageism certainly affects employment and salary, and older men are frequently seen as more valuable to society than older women, and therefore more likely to be paid more, promoted, or re-hired when laid off.

Still, I believe this most recent study, in the aggregate, is heartening for American women. Lily Ledbetter, for whom the 2009 Ledbetter Fair Pay Act is named, estimated that she lost over $200,000 in salary, benefits and retirement income because of gender discrimination. When he signed the Ledbetter Act into law, President Obama said:

…equal pay is by no means just a women’s issue – it’s a family issue. It’s about parents who find themselves with less money for tuition or child care; couples who wind up with less to retire on; households where, when one breadwinner is paid less than she deserves, that’s the difference between affording the mortgage – or not; between keeping the heat on, or paying the doctor’s bills – or not.

It’s not just a women’s issue, obviously. But we’re still the ones most likely to be fighting it, and the ones for whom any good news should be celebrated.