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Women's Lost Wages - Cost of the Gender Pay Gap

Over a Lifetime, Women Paid Less Than Men Lose Almost as Much as They Earn

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Updated June 06, 2012
What does a woman lose in earnings simply due to her gender? Close to half a million dollars over a lifetime. According to statistics provided by the White House based on U.S. Census data, in 2011 a typical 25-year-old woman working full-time all year earned $5,000 less than a typical 25-year-old man.

The cumulative effects show the economic impact of the gender pay gap even when women continue to work full-time throughout their lives:

  • In one year a woman earns $5,000 less
  • In one decade a woman earns $34,000 less
  • In a lifetime, by age 65 a woman earns $413,000 less
On average, full-time working women earn only 77 cents for every dollar a man earns. This means women have to work additional days to earn what a man earns in one year. Equal Pay Day, an annual observance of pay inequity in the United States, illustrates how far into the following year a woman must work to earn what her male counterpart earned the previous year. Equal Pay Day typically falls on a Tuesday in April.

The gender wage gap grows even greater for full-time working women of color. According to the most recent U.S. census statistics, African American women earn just 64 cents and Latina women earn just 56 cents for every dollar earned by a Caucasian man.

Even when differences in pay across various fields or qualifications such as education, experience and skills are factored in, the gender pay gap exists.

One of the most vocal and visible champions of the the gender pay gap battle is Lilly Ledbetter, a Goodyear Tire employee whose lost wages totaled nearly a quarter of a million dollars. Ledbetter sued Goodyear, taking her case all the way to the Supreme Court where her claim was denied. Undaunted by the setback, she went on to push for legislation to extend the time period in which claimants can bring pay discrimination claims and ended up with a bill named after her -- the Lilly Ledbetter Fair Pay Act which was the first law signed by President Obama after his inauguration.

While the Equal Pay Act of 1963 made it illegal for employers to pay unequal wages to men and women who perform substantially equal work, violations of the equal pay laws are difficult to prove and enforcement even more challenging. Even those cases of gender discrimination that make it to the Supreme Court -- like Lilly Ledbetter's case and that of AT&T Corp v. Hulteen which alleged maternity leave and pension gender bias -- rarely receive a favorable ruling. Subsequent legislation -- from Title VII to the Paycheck Fairness Act -- attempted to add additional employment protections but the latter failed to pass the Senate in November 2010 and again in June 2012.

Although lost wages continue to be an issue for working women, the total amount each woman has been shortchanged due to gender has decreased over time as the gender wage gap has shrunk. From 1979 to 2010, women's percentage of earnings compared to men has increased from 62% to 81%.

Sources:
"Did You Know That Women Are Still Paid Less Than Men?" Whitehouse.gov. Retrieved 5 June 2012.
"FACT SHEET: Fighting for Equal Pay and the Paycheck Fairness Act."Whitehouse.gov. 5 June 2012.

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