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A persistent gap in equal pay for equal work

The Biden Forum Highlight is a series of quick reads on the middle class. Each week, editors at the Biden Forum will highlight a key insight from new economic research and break down what it means for middle-class Americans. What should we highlight next? Email your questions or recommendations to [email protected].

The salary gap between women and men has been an unfortunate, persistent norm in the United States. For decades, advocates have pushed for closing this gap, with heightened urgency as women have grown to represent nearly half of the American workforce.

We often talk about the gender wage gap (i.e., men versus women) without talking about the racial pay gap among women (i.e., white women versus black women). Specifically, when race and gender intersect, research suggests that black women face an economic injustice deeper than their female peers — and far greater than their male peers.

Source: equitablegrowth.org

According to a working paper published by the Washington Center for Equitable Growth, black women make 60 cents for every dollar earned by white males. The authors find that 22 cents of the gap is unexplained, which the authors suggest is likely due to discrimination. While 18 cents of the gap can be explained by variables relating to human capital — including age, education, family structure, occupation, or industry — the authors note that some of these factors, such as which occupation to pursue, may themselves be driven by discrimination as well.

Stubborn inequality in average wages persists across all sectors and exposes both racism and sexism in systemic wage losses for women. The troubling reality of our economy is that women of color are continually shortchanged when it comes to their deserved pay. Equal pay can have a sizable ripple effect by strengthening families, invigorating communities, buffering the tax base, and boosting the economy as a whole. For many Americans, helping to alleviate the wage penalties resulting from discrimination is one of the most promising strategies for raising their standard of living.