Home Editorials Factors Contributing to the Pay Gap

Factors Contributing to the Pay Gap

Pretty much everyone has heard this stat: Women make just 82 cents for every greenback earned by men. And the wage chasm is even wider for most women of color. In more than a decade, the gender wage gap has only narrowed by 4 cents. If this pace continues, women aren’t expected to reach pay equity with men until 2059, according to the Center for American Progress.

So, it’s a huge, stubborn problem with far-reaching effects. But have you ever thought about what factors may be contributing to the pay gap? Let’s look at that and more.

The Issue

Women’s participation in the workforce has increased tremendously since the 1950s. More and more women are putting in longer hours and seeking college degrees. However, such progress notwithstanding, large wage gaps between women and men continue, especially for non-white women. But what is driving the wage gap?

What is the Gender Wage Gap?

The gender wage gap is simply the difference in monetary compensation between men and women. For decades now, men have earned more than women, and the chasm is even more yawning for women of color overall.

What’s Behind the Issue?

The pay gap issue is fraught and dynamic, as are the reasons at its root. But here are a few of the main causes of gender-based pay inequities.

Less Overall Experience

Whether due to caregiving or other familial responsibilities, women are forced to leave the workforce in greater numbers than men, on average. This means that they generally have less work experience than men.

It’s true that, due to paid medical and family leave, women are now more apt to return to employment – and sooner than before. A problem is that, as of 2019, company-paid family leave was available to only 19 percent of employees. Further, just 40 percent of employees had access to short-term disability insurance that allowed them, if necessary, to attend to their own health needs.

Field Differences

Occupational segregation is rampant, and its consequences far reaching. This refers to the funneling of males and females into disparate kinds of industries and positions predicated on tradition, expectations, and gender norms. Within organizations, a pay equity audit can turn up such discrimination, and is highly recommended.

Here’s the big picture: historically, women have been steered toward what were – and in some quarters, still are – known as women’s positions, which have indeed been mostly populated by women. Such jobs include childcare workers and home health aides, positions that generally pay less and provide fewer benefits than the jobs that usually go to men, like those in building and construction. Such gender-based wage gaps traverse all industries and most occupations and exist up and down employment levels and rankings.

Gender-Based Pay Discrimination

One would think that this wouldn’t be an issue since such discrimination has been unlawful for the last 59 years. Yet, here we are, especially for black women and other women of color. Such discrimination can particularly flourish in organizations that dissuade employees from discussing pay by thinly veiled threats of retaliation.

Discrimination also takes place when decision-makers rely on candidates’ employment histories when hiring and setting pay. Why? Because such pay was likely too low to begin with. Such practice can perpetuate the pay gap, which is why some states have made it illegal.

Hours Worked

Women generally work fewer hours due to having to take care of family and perform other unpaid duties. Because of that, they are more likely than men to work part-time, which translates to less money and fewer benefits than what full-time workers get.

So, yes, there are several factors that contribute to the pay gap. We’ve got a long way to go, as a society, before real progress is made. But you as an organization can do your part. Not just because it’s the right thing to do, but because it goes to your ability to recruit and retain talent. Get the leading HR consultant Mercer to help you.