Women in the U.S. are more empowered than ever when it comes to managing their money. investing in themselves for their future and making wise financial decisions.
However, they still face one hurdle today: the gender pay gap.
Census Bureau data for 2023 estimates women working full time, year-round earned 83 cents for every dollar their male counterparts earned. Evidence of the gender pay gap is as well-documented as it is longstanding, but the extent to which it’s even worse for women of color and women who work in finance and insurance shows how stubborn and entrenched the problem is, according to a new Pawonation.comanalysis of Census Bureau data.
The gender wage disparity affects every woman differently. This discrepancy becomes particularly stark among specific racial and ethnic communities, as well as across different sectors and occupations. A woman's location plays a role in determining how closely her earnings align with those of her male peers. Surprisingly, higher educational attainment hasn’t been enough to eliminate this earning difference between genders, although over half of working females now hold degrees. having a college degree And prime-aged women (aged 25-54) engaging in the workforce at unprecedented levels.
Unequal pay leaves women working with less, ultimately impacting their ability to save money To pay off debt and secure your finances, consider this: Over a 40-year work span, women could potentially miss out on more than $450,000 compared to what men usually make in equivalent roles, based on figures from Pawonation.com. For Black and Hispanic women, these discrepancies result in an even larger shortfall of approximately $1 million and $1.3 million, respectively, throughout their careers.
To bring more attention to the gender pay gap, Pawonation.com examined Census Bureau information to identify the largest disparities in pay across various sectors, job roles, and states—and whom these discrepancies affect most significantly.
Main points about the gender pay gap
- The largest wage disparity exists for Black and Hispanic women. In 2023, these two groups received 67 cents and 58 cents, correspondingly, for each dollar earned by a white, non-Hispanic man. Meanwhile, white women made only 80% of what white men did, whereas Asian women came very close to achieving equal pay, receiving 94 cents for every dollar earned by their white, non-Hispanic male peers during the same year.
- Industries heavily dominated by men, like finance, insurance, science, and technology, exhibit the largest gender pay disparities.
- The largest disparities in earnings between women and men occur in legal and sales professions.
- The states exhibiting the largest disparities in gender pay are Utah and Louisiana. Conversely, residents of Rhode Island experience the least difference in wages between genders.
The disparity in pay between genders is most pronounced for Black and Hispanic women.
Women of color face the most significant impact from this issue. gender pay gap. On average, Black women who worked full-time throughout the year made 67% of what White, non-Hispanic men earned in 2023. Meanwhile, Hispanic women earned just 58%, based on an analysis conducted by Pawnation.com using Census Bureau statistics.
As of 2023, Asian women have come nearest to achieving salary parity, earning 94 cents for each dollar earned by a white, non-Hispanic man. In 2023, white women employed full-time throughout the year made only 80% of what their male peers did, reflecting the broader gender wage disparity.
The wage disparity has decreased for all categories of women over the past thirty years, though this reduction was more pronounced among White and Asian females compared to their Black and Hispanic counterparts. Below are the figures showing the shrinkage in earning gaps for each category from 1988 to 2023:
- Asian women: 26 percentage points
- White women: 16 percent points
- African American women: 8 percentage points
- Hispanic females: 5 percentage points
According to economists and financial analysts, the gender pay gap is driven by factors such as gender bias, the higher probability of women being employed in sectors with lower wages, inadequate family-supportive policies, and the motherhood penalty For Black and Hispanic women, experiencing racial discrimination is an additional factor.
Dr. Nicole Smith, who leads the Georgetown University Center on Education and the Workforce as their chief economist, points out that Black and Hispanic women face this issue more frequently. employment and promotion discrimination This makes it even harder for these individuals to advance in their careers or attain higher salaries compared to other groups.
About a quarter of employed women (23 percent) said they have experienced discrimination because of their gender, while only 1 in 10 employed men say the same, a 2023 Pew Research poll The findings revealed that approximately 40% of Black employees and 20% of Hispanic employees reported experiencing racial or ethnic discrimination or unfair treatment from employers regarding hiring, salary, or advancement opportunities. This percentage was significantly lower at just 8% for white employees.
The larger disparity in wages between Black and Hispanic women and White, Non-Hispanic men may be due to the lower number of Black and Hispanic Americans who have completed college when compared to their White or Asian counterparts, as reported. Pew Research However, even when examining Black and Hispanic women who have obtained a bachelor’s degree or more advanced education, Census Bureau data indicates that the wage disparity continues.
“Despite our progress, there remains a glass ceiling making it challenging for women to advance in specific fields of education or particular careers,” Smith states. “Even though we claim to live in a post-racial society, racial and ethnic discrimination persists.”
The finance, insurance, scientific, and technology sectors exhibit the largest gender pay disparities.
Each sector experiences a gender pay gap; however, this disparity is particularly pronounced in specific fields. According to pawnation.com’s analysis of salary discrepancies across more than two dozen industries, the widest gap occurred within the finance and insurance sector. In 2023, women constituted over half of the workforce (54%) in finance and insurance yet only garnered an average of 63 cents for every dollar their male counterparts earned, as indicated by Census Bureau statistics.
Despite having more women in the financial services sector nowadays, North points out that it remains a difficult field for women to maneuver through, which diminishes their inclination to remain in such an environment.
There continues to be significant prejudice and subtle insults," North states. "Individuals are less inclined to persevere due to the realization that they must essentially excel at what is traditionally considered men's work, which can be very disheartening. This is something I encounter frequently.
The largest gender pay gaps can be found in other sectors such as:
- The management of companies and enterprises accounts for 71.3 percent.
- Healthcare and social services (73 percent)
- Professional, scientific, and technical services accounted for (73.8 percent).
Across various sectors, there's a division of labor based on gender. According to Smith, women tend to gravitate towards less remunerative roles within their respective fields despite having comparable educational qualifications to men, which contributes significantly to the disparity in wages among genders working in the same field. For instance, this trend can be observed in STEM professions.
Even when discussing the proportion of women in STEM fields, they often create their own separate groups," Smith explains. "Fields like pharmaceuticals and biological sciences exemplify this trend. Among these disciplines, biological sciences stands out as one of the lowest-paying areas within STEM and happens to be predominantly female.
Education is another example of an industry where occupational segregation impacts women’s earnings. Dr. Carolyn Sloane, a labor economist, found in her research that men in the education field are twice as likely to move into higher-paying management roles and women in the same field are twice as likely to go into lower-paying administrative support roles, although women are twice as likely to major in education.
Several sectors exhibit a more modest gender pay gap. In construction, this disparity is particularly small, with women earning approximately 95 cents for each dollar earned by their male counterparts. Similarly, other fields featuring minimal gender wage differences include:
- Arts, entertainment, and recreation accounted for (89.2 percent)
- Residential and commercial property along with rentals and leases accounted for (88.7 percent).
- Administrative and support services along with waste management (88.3 percent)
Legal and sales professions exhibit the broadest gender disparities.
Following an analysis of remuneration differences spanning over 30 professions, Pawnation.com discovered that the wage gap is most pronounced in legal fields, where women earn approximately 55 percent of what men do as of 2023.
Sales and associated roles exhibit the second-largest wage disparity between genders, where women in these positions make only 56 cents for each dollar earned by men. Other professions displaying significant pay disparities include:
- Occupations related to natural resources, construction, and maintenance make up 64.2 percent.
- Transportation occupations (64.6 percent)
- Firefighting, fire prevention duties, along with other roles in protective services including supervisory positions (66.8 percent).
A lot of roles featuring minimal or nonexistent discrepancies in pay between genders often see majority female participation. The professions exhibiting the least differences in pay between men and women include:
- Occupations related to community work and social services (97.7 percent)
- Healthcare support roles (94 percent)
- Occupations involving office work and administration made up 89.9 percent.
- Life, physical, and social science occupations (89.5 percent)
- Architecture and engineering occupations (85.5 percent)
The states exhibiting the largest gender pay gaps are Utah and Louisiana.
Your place of residence influences your employment opportunities, general health, and daily habits. For women, it may also impact their income levels. The variations in wages between different regions partially mirror the distinctions in occupations and economic sectors present in those areas as well as the differing characteristics of the local labor force.
Here are the top five states with the least significant gender pay gaps:
| State | Men’s median annual earnings | Women’s median annual earnings | Female-to-male earnings ratio |
|---|---|---|---|
| Rhode Island | $70,274 | $62,763 | 89.3% |
| Vermont | $63,691 | $55,832 | 87.7% |
| New York | $71,168 | $62,111 | 87.3% |
| California | $70,692 | $61,544 | 87.1% |
| Hawaii | $62,489 | $54,348 | 87.0% |
Here are the last five states with the biggest disparities in gender pay:
| State | Men’s median annual earnings | Women’s median annual earnings | Female-to-male earnings ratio |
|---|---|---|---|
| Louisiana | $60,294 | $42,954 | 71.2% |
| Utah | $70,008 | $50,852 | 72.6% |
| Alabama | $58,319 | $43,074 | 73.9% |
| Wyoming | $62,142 | $45,971 | 74.0% |
| North Dakota | $67,128 | $50,587 | 75.4% |
What comes after the gender pay gap?
Two perspectives can be considered when examining the advancement of the gender pay gap—depending on your point of view. According to Census Bureau statistics, in 1988, women made approximately 66% of what men did, whereas by 2023, this figure had risen to about 83%.
Nevertheless, during the past twenty years, the gender pay gap has stayed relatively stagnant. Between 2000 and 2010, it grew by approximately three percentage points, followed by an increase of nearly six percentage points from 2011 to 2023.
Smith indicates that there isn't just one reason behind the stagnant gender gap over the past twenty years. He suggests that multiple elements could be at play: insufficient advancements in work-related policies advantageous to women, including provisions for paid parental leave and child care support; the specific fields of study and employment choices made by women; instances of discrimination; and wider economic conditions. Additionally, women often bear most of the caregiving duties, which can lead many to either accept less lucrative positions offering greater flexibility or withdraw from the labor force entirely.
Three methods for women to achieve financial empowerment
The duty of closing the gender pay gap doesn't lie solely with individual women, yet there are actions they can undertake to effectively represent themselves and enhance their confidence when dealing with personal finance, despite potentially having fewer resources. Here are some strategies you might consider to build your financial prosperity:
- Build an emergency fund: Begin contributing a small amount of money each week to a high-yield savings account Gradually increase your savings until they can cover between three to six months' worth of living costs. Having larger reserves will make you better prepared for an unforeseen event like losing your job or facing an urgent expenditure.
- Invest in the person you will become If your job provides a 401(k) plan, make sure to utilize it. Should your employer not provide such a plan, think about setting up either a conventional IRA or a Roth IRA instead. According to many financial advisors, saving around ten percent of your yearly earnings for retirement is ideal; however, if this isn't feasible initially, begin with a modest contribution like three to five percent from each pay period into your retirement fund. When managing funds within your retirement account, aim for investments in low-fee options. index funds . Index funds are a great option if you want to diversify your investment portfolio, minimize the time and money you spend investing and reduce your risk over time.
- Negotiate your pay and practice salary transparency Make sure you arrive ready with statistics showing the objectives and metrics you've achieved over the past half-year. Utilize web-based resources for comparing salaries to understand how much others with comparable backgrounds and locations earn. Additionally, engage openly with people in your field regarding their salary brackets.
Smith states, "We must enter those boardrooms and conference halls knowing exactly what we deserve and how much we should receive, then firmly negotiate for our initial compensation. We need to continually push boundaries since, otherwise, we'll still be discussing this decade after next."
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Methodology
To identify which racial and ethnic groups experience the largest gender wage disparities, Pawonation.com compiled and examined statistics sourced from the U.S. Census Bureau’s Current Population Survey Annual Social and Economic (ASEC) Supplement. The comparison of women’s incomes relative to those of White, non-Hispanic males spanned from 1988 through 2023, focusing specifically on the median yearly earnings of individuals working full-time throughout the entire year who were at least 15 years old. For assessing these discrepancies across different states, sectors, and occupations, Pawonation.com gathered and reviewed information derived from the U.S. Census Bureau’s American Community Survey (ACS), also for 2023, concentrating on the median yearly income of people engaged in full-time work all-year-round who were over the age of 16. Every piece of data utilized in this research has been corrected for changes in purchasing power over time.
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