Women lose $513B a year to gender pay gap

Losses are compounded throughout their lives

“So, here you are saddled with more debt.” Kim Churches AAUW’s CEO

Women experience $513 billion in lost wages a year because of the stubborn pay gap that persists between them and their male peers, according to a new report from the American Association of University Women. The consequences of women earning 80 cents on average for every dollar brought home by a man can impact nearly every aspect of their lives, from the ability to pay off college debt to their decisions about having children to how financially stable they are when they ultimately retire. “Women right away from the first job are earning less,” says Kim Churches, AAUW’s CEO, who added that women disproportionately accumulate more student loan debt than their male peers. “So, here you are saddled with more debt. Now, you have a pay gap. And it continues throughout your life . ... That compounding goes all the way through to retirement.” The wage disparity begins to widen almost immediately, with 20-year-old working women tending to earn 90 cents for every dollar paid to a male peer. But, by the time they turn 54, women are earning 22 cents less on average, according to the AAUW report. That’s due in part to new employers basing their salary offers on what a worker earned previously, leaving women at a disadvantage and making it harder for them to catch up. (Some states, like California and Delaware, have adopted laws prohibiting employers for asking about salary history.) New motherhood and fatherhood also weigh differently on wages, with men more likely to receive a pay raise once they become a parent while women often see their financial fortunes falter for reasons ranging from inflexible schedules to needing time off to be their children’s primary caregiver. “This old Ozzie-and-Harriet model of what a family looks like just doesn’t work in modern workplaces, but sadly biases exist whether they’re conscious or implicit ... in terms of how we think about childhood and parenthood,” Churches says. “We should be doing a better job on paid parental leave. We should be doing more on flexible schedules ... which can still lead to great productivity.” The pay gap is more stark for women of color. Latinas earned only 53 cents for every dollar earned on average by white men last year, while black women earned 61 cents. Asian women earned 85 percent. Among the states, California had the slimmest earnings gap, with women being paid 89 cents for every dollar typically brought home by a man, while Louisiana fared the worse, with women earning just 69 percent of a male colleague’s pay. Efforts are underway to erase such inequities, including working with employers and industries to be more transparent about what they pay and helping women become stronger advocates within their workplaces. The AAUW has a goal of training 10 million women how to negotiate for better salaries.