Gender Wage Gap: Why it Exists, and how Women can Help Change It

Gender Wage Gap: Why it Exists, and how Women can Help Change It

New research demonstrates that the wage gap is especially present among higher earners

John Rossheim | Monster Senior Contributing Writer

There’s no doubt about it: The gender pay gap has shrunk gradually in recent decades, but women in the US workforce still earn substantially less than their male colleagues. That’s the consensus of advocates for women workers and the common conclusion of government reports on wages and salaries.

Still, some observers contend, women’s generally lower total earnings are a direct result of their work/life choices, not a consequence of employers who discriminate by gender in determining pay or granting promotions.

Government statistics present a fairly consistent picture. Women’s median annual earnings have made steady progress through most of the last quarter-century, rising from 59.2 percent of a man’s paycheck in 1981 to 76.5 percent in 2004, according to figures from the US Census Bureau.

But while the ratio of women’s-to-men’s annual pay has plateaued since 2001, when it stood at 76.3 percent, women’s median weekly earnings, which include seasonal workers, rose from 76.4 percent of men’s pay in 2001 to an all-time high of 80.4 percent in 2004. So says Women in the Labor Force," a report from the Bureau of Labor Statistics (BLS).

Men Are Three Times More Likely to Earn Six Figures

The gender pay gap is especially prominent among high earners. Of the 70.8 million full-time male workers in 2004, 5.7 million, or 8.1 percent, earned $100,000 or more, according to the Census Bureau’s Current Population Survey." In contrast, of 51.6 million full-time female workers, only 1.3 million (2.5 percent) earned six figures.

Even with women’s increased educational attainment and workforce participation, pay differences persist. “Continuing occupational segregation is another cause of the wage gap,” says Amy Caiazza, director of democracy and society programs at the Institute for Women’s Policy Research.

Some advocates for women workers believe lower pay follows women as they increasingly enter career fields that have traditionally been male-dominated. “As more women go into an occupational field, the salary seems to go down,” says Michele Leber, chair of the National Committee on Pay Equity, citing human resources as an example.

Women earn less in every major industry tracked by the BLS, but the gap with men’s pay varies widely by sector. The differential is greatest in finance and insurance, where women’s median weekly earnings in 2004 were just 58.4 percent of men’s pay. The smallest gap was found in construction, where women made 94.9 percent as much as men.

Alternative View: Work/Life Choices, Not Gender, Determine Pay

But some experts say women earn less because they choose less-demanding industries, occupations and work arrangements.

“Research shows that work/life decisions lead to men earning more and women working less and leading happier and healthier lives,” says Warren Farrell, author of Why Men Earn More: The Startling Truth Behind the Pay Gap — and What Women Can Do About It. People who work 44 hours a week earn twice as much as those who work 34, according to Farrell’s analysis of BLS data.

Farrell says it’s a mistake –- and disempowering — for women to believe that gender determines pay. “When you look at men and women who have never been married and have no kids, women make 117 percent of what men make, even when you control for education, hours worked and years in the workplace,” he says.

How Can Women Close the Gap?

Those on both sides of the issue agree: To address pay disparity, women must take matters into their own hands. “This means getting salary figures and talking to people who make decisions about wages,” Leber says.

“What’s needed is mentoring to make connections and training to learn new skill sets and move to higher jobs,” Caiazza says. "Women can get more education and be assertive and confident in negotiating pay.

Women can also ask their elected representatives to put more muscle behind existing laws designed to protect against gender pay discrimination. The Paycheck Fairness Act and Fair Pay Act were introduced in 2005, but they haven’t made it out of committee," Leber explains.

These proposed federal laws would strengthen enforcement of fair-pay provisions of the Fair Labor Standards Act and protect employees who complain of pay bias against employer retaliation.

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