New Data Shows the Gender Wage Gap Widened in 2015

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A new fact sheet by the Institute for Women's Policy Research (IWPR) finds that progress on narrowing the wage gap in the United States has not only stalled, but reversed.

the widening of the wage gap, even as women have higher levels of education than men, is a setback for women, their families, and the United States economy

On the eve of International Women’s Day 2016—with this year’s campaign focused on reaching gender parity across the globe—a new fact sheet by the Institute for Women’s Policy Research (IWPR) finds that progress on narrowing the wage gap in the United States has not only stalled, but reversed. The ratio of women’s to men’s median weekly full-time earnings declined from 82.5 percent in 2014 to 81.1 percent in 2015, increasing the gender gap to 18.9 percent from 17.5 percent last year.

While both women’s and men’s median weekly earnings for full-time work increased during 2015, the increase was more substantial for men than women. Controlling for inflation, women’s median earnings increased by 0.9 percent to $726 weekly, while men’s earnings increased by 2.6 percent to $895 weekly. In the past ten years (2006 to 2015), the weekly gender wage gap narrowed by just 0.3 percentage points, compared with 6.0 percentage points in the previous ten years (1996 to 2005) when change was 20 times faster than in the most recent decade.

“While we have many advancements to celebrate since the first International Women’s Day more than 100 years ago, the widening of the wage gap, even as women have higher levels of education than men, is a setback for women, their families, and the United States economy,” said IWPR President and MacArthur Fellow Heidi Hartmann, Ph.D.

The new fact sheet also highlights earnings differences by gender, race, and ethnicity, finding that black women saw the smallest gains in weekly earnings among women, while black men were the only group to see no weekly wage growth at all. Black women’s real earnings increased by 0.5 percent, compared with Asian women at 4.2 percent, Hispanic women at 3.2 percent, and white women at 1.1 percent. Earnings for a full-time week of work leave Hispanic women well below, and Hispanic men and black women not much above, the qualifying income threshold for receipt of food stamps of $606 per week for a family of four.

A recent IWPR analysis of the economic impact of equal pay on U.S. economy, which also provides state-by-state data, finds that the poverty rate for working women would be cut by more than half, from 8.2 percent to 4.0 percent, if women were paid the same as comparable men, who are of the same age, have the same level of education, work the same number of hours, and have the same urban/rural status. The gender wage gap cost U.S. women—who are also consumers, savers, and business owners—$482 billion in 2014. The new state-by-state analysis shows that, with equal pay for women, poverty for working women would fall by more than half in 28 states. California’s working women would have earned $51.8 billion more dollars with equal pay, an earnings increase that, by itself, is greater than the entire economy of South Dakota ($45.9 billion).

“Data like these help contextualize the economic impact of pay inequality, not just on individuals but on the nation as a whole,” said Dr. Hartmann. “If policymakers are serious about addressing inequality, in terms of both race and gender, closing the wage gap would be a good place to start.”

The weekly gender earnings ratio is one measure of the gender wage gap. The more commonly cited ratio compares women’s and men’s median annual earnings for full-time year-round workers. In 2014, this annual wage ratio was 78.6 percent, a gender wage gap of 21.4 percent (data for 2015 are not yet available). The weekly gender earnings ratio tends to be slightly higher than the annual ratio, as it excludes the self-employed and earnings from annual bonuses and includes full-time workers who work only part of the year. Both the weekly and annual earnings ratios are for full-time workers only; if part-time and part-year workers were included, the ratios of women’s to men’s earnings would be even lower, as women are more likely than men to work reduced schedules, often in order to manage unpaid childrearing and other caregiving work.

The Institute for Women's Policy Research (IWPR) is a 501(c)(3) tax-exempt organization that conducts rigorous research and disseminates its findings to address the needs of women and their families, promote public dialogue, and strengthen communities and societies.

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Mallory Mpare-Quarles
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