Women around the world are being paid less than men for work of equal value. The global gender pay gap is stuck at 16%, and women in some countries are paid as much as 35% less than men, according to a report published by UN Women in 2020. Still, even these figures do not capture the full extent of pay inequality - particularly in developing countries where informal work or self-employment is rampant. Women in these places often take low-paid jobs that do not provide protection under local labor laws or social benefits.
In most places, gender pay gaps are rooted in systemic inequality. Prevailing stereotypes tend to push women away from traditionally male-dominated occupations, and pull them towards poorly-compensated care work. Meanwhile discrimination prevents many women from winning prestigious leadership roles, as notions of traditional gender roles create and sustain pay inequities.
Women are often hit with a motherhood-wage penalty, for example, which increases alongside the number of children they have. This can manifest in the form of working fewer paid hours, choosing relatively family-friendly jobs with lower salaries, hiring and promotion decisions that (consciously or not) penalize mothers, and the absence of programmes that support women’s re-entry into the workforce.
Gender pay gaps are also wider for women of colour, and for women who progress to higher levels of responsibility and authority. According to the #BlackWomenomics report published by Goldman Sachs in 2021, Black women earn 15% less than white women on average, and 35% less than white men. The report estimated that reducing that racial gender pay gap in the US could create as many as 1.7 million jobs, and raise annual GDP by as much as 2.1% (equivalent to about $450 billion) annually. Gaps also tend to be starker in certain industries; a sample of reported pay at 10 large UK banks, for example, showed a 44.5% difference between male and female hourly wages as of April 2020 - meaning that a woman there has been earning about 56 pence for every pound earned by a man.
At the current pace, the WEF has suggested that achieving gender parity in economic participation and opportunity will take 257 years. Some potential ways to speed up related progress include pay-equity laws requiring employers to eliminate pay gaps, greater transparency, and enabling employees to organize and bargain collectively.
Employers can help close the gender pay gap with pay equity analysis and continuous monitoring of pay equity within their organizations using compensation management software.
Payscale’s Annual Gender Pay Gap Report reveals how much women are paid compared to men with analysis by race, job level, age, education, industry, and occupation, as well as unemployment during COVID-19 and the Motherhood Penalty.