3 Reasons Why the Gender Pay Gap Still Exists

April 3, 2017, 12:00 PM UTC

It’s been 54 years since the Equal Pay Act became law, but American women are still fighting to make as much money as men. Though women have made strides — they now make an average of 82 cents for every dollar a man earns, according to federal data, compared to 54 cents prior to the Equal Pay Act in 1963 — it could take at least 70 more years before the gap completely closes.

Tuesday, April 4 is Equal Pay Day—which represents how far into 2017 a woman must work in order to earn what a man did in the previous year. But it’s also a moment to look at why we’re still talking about the gender pay gap in the first place. There are many reasons the gap is so hard to close, according to Olivia Mitchell, the director of the pension research council at the Wharton School of the University of Pennsylvania. Three of the most significant contributors, she says, are the penalty women face for becoming mothers, women’s lack of negotiating skills and the bias women face from employers.

The Motherhood Penalty

Research shows that many mothers suffer workplace-related consequences after having a child. When compared with men and childless women, new moms are often perceived to have lower competence and commitment, and they face higher professional expectations and a lower chance of hiring and promotion. According to one study, the pay gap between mothers and women who aren’t mothers could actually be even bigger than the one between men and women. “There’s an opportunity cost of staying home,” Mitchell says, referring to women who take time off after their child is born. “Time out of the labor force is a penalty.”

About 39% of mothers say they have taken “significant” time off work after having a child—a decision that usually results in those mothers earning an average of 7% less per child compared to childless women. One sociology professor at the University of Massachusetts, Amherst found that the penalty can actually reach up to 15% per child among low-wage workers. As for men, the opposite is true. New fathers typically see an earnings bump after their child is born.

To combat the motherhood penalty, Mitchell emphasized the importance of subsidized daycares—much like the ones in Sweden. (Also worth noting: Parents there are entitled to 480 days of paid parental leave after a child is born, as well as extra tax credits to cover child-rearing costs). “Access to affordable, good quality day care is critical,” she says. “That’s what it’s really going to take.”


Closing the gender pay gap “also takes women doing more negotiation for what they want,” Mitchell says, adding that “it’s all in the art of asking the right way.” Research shows that women are less likely to negotiate their salary than men—and a lack of confidence or guidance is sometimes to blame. But as one Harvard Business Review article notes, the problem may have more to do with how women are treated when they negotiate, rather than their general confidence or skills at negotiation—a phenomenon that has been dubbed the “social cost” of negotiation.

For example, women may be more hesitant to negotiate their salary than men because advocating for higher pay could present a socially awkward or difficult situation. But that hesitation could be costly: One 2008 study found that failing to negotiate a first salary could could result in a $500,000 loss by age 60.

As for what women can do to improve their negotiation skills? Mitchell suggests taking a class. The Negotiation Training Institute has programs across the U.S. that are open to the general public. Harvard Law School also offers courses through its Negotiation Institute, but at a price: A two-day course is $3,000.

Employer Bias

According to Mitchell, employer bias is also at blame for women’s lower salaries. This bias—whether conscious or not—results in “not rating women as highly, and not paying them their due,” she says. In other words, employers may unknowingly undervalue the work their female employees do.

A recent Glassdoor study found that even when men and women with similar work experience and education levels were working at the same company with the exact same job title, women, on average, were still paid less. Despite the assumption things would be equal, and despite federal law requiring men and women to be paid the same for equal work, researchers found that men made 5.4% more in base pay than female counterparts, and 7.4% more in overall compensation. As another article notes, this pay discrepancy may be a result of extensive bias against women in the workplace, combined with the general undervaluation of women’s work.

Employer bias won’t be easy to fix. Negative, deeply rooted stereotypes about women’s abilities and opportunities are at the root of gender discrimination, perpetuating societal issues like pay disparity, occupational segregation and fewer leadership opportunities.

And there are other causes of the gender pay gap beyond the three above—including an education disparity between men and women, as well as women typically being overrepresented in lower-paying fields.

Adding to the challenges, while the wage gap is gradually narrowing—thanks in part to women’s progress in education and stagnation in men’s wages—the pace of that narrowing has slowed over the past decade, Mitchell says.

“People are concerned things have slowed down,” she says. “We need to continue the pressure to integrate women into the workplace.”

Editor’s note: This story has been corrected. It originally stated that women make 79 cents for every dollar a man earns. The correct statistic is 82 cents for every dollar a man earns.

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