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The Gender Wage Gap

The Gender Wage Gap

Why It Exists and How Women Can Help Close It

There's no doubt about it: The gender pay gap has shrunk gradually in recent decades, but women in the US workforce still earn substantially less than their male colleagues. That's the consensus of advocates for women workers and the common conclusion of government reports on wages and salaries.

Still, some observers contend, women's generally lower total earnings are a direct result of their work-life choices, not a consequence of employers who discriminate by gender in determining pay or granting promotions.

Government statistics present a fairly consistent picture. Women's median annual earnings have made steady progress through most of the last quarter-century, rising from 59.2 percent of a man's paycheck in 1981 to an all-time high of 77.8 percent in 2007, according to figures from the US Census Bureau.

However, the ratio of women's median weekly earnings to men's (which include seasonal workers), declined from a historic high of 81 in 2005 to 80.2 percent in 2009.

Men Are Three Times More Likely to Earn Six Figures

The gender pay gap is especially prominent among high earners. Of the 76 million male workers who reported income in 2009, about 7.7 million (10.1 percent) earned $100,000 or more, according to the Census Bureau's Current Population Survey. In contrast, of the 69.7 million women reporting income in 2009, about 2.5 million (3.58 percent) earned at least six figures.

Even with women's increased educational attainment and workforce participation, pay differences persist. "Continuing occupational segregation is another cause of the wage gap," says Amy Caiazza, director of democracy and society programs at the Institute for Women's Policy Research.

Some advocates for women workers believe lower pay follows women as they increasingly enter career fields that have traditionally been male-dominated. "As more women go into an occupational field, the salary seems to go down," says Michele Leber, chair of the National Committee on Pay Equity, citing human resources as an example.

Women earn less in every major industry tracked by the BLS, but the gap with men's pay varies widely by sector. The differential is greatest in finance and insurance, where women's median weekly earnings in 2009 were just 62.2 percent of men's pay. The smallest gaps were found in real estate rental and leasing, where women made 93.3 percent as much as men, and in construction, where women earned 92.2 percent as much as men.

Alternative View: Work/Life Choices, Not Gender, Determine Pay

But some experts say women earn less because they choose less-demanding industries, occupations and work arrangements.

"Research shows that work/life decisions lead to men earning more and women working less and leading happier and healthier lives," says Warren Farrell, author of Why Men Earn More: The Startling Truth Behind the Pay Gap -- and What Women Can Do About It. People who work 44 hours a week earn twice as much as those who work 34, according to Farrell's analysis of BLS data.

Farrell says it's a mistake –- and disempowering -- for women to believe that gender determines pay. "When you look at men and women who have never been married and have no kids, women make 117 percent of what men make, even when you control for education, hours worked and years in the workplace," he says.

How Can Women Close the Gap?

Those on both sides of the issue agree: To address pay disparity, women must take matters into their own hands. "This means getting salary figures and talking to people who make decisions about wages," Leber says.

"What's needed is mentoring to make connections and training to learn new skill sets and move to higher jobs," Caiazza says. "Women can get more education and be assertive and confident in negotiating pay."

Women can also ask their elected representatives to put more muscle behind existing laws designed to protect against gender pay discrimination, such as the Lilly Ledbetter Fair Pay Act, which was enacted in January 2009.

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