"The cost-of-living crisis is impacting women disproportionately after the shock of labour market losses during the pandemic and the continued inadequacy of care infrastructure," Saadia Zahidi, managing director at the Geneva-based think tank, said in a released statement. "In face of a weak recovery, government and business must make two sets of efforts: targeted policies to support women's return to the workforce and women's talent development in the industries of the future. Otherwise, we risk eroding the gains of the last decades permanently and losing out on the future economic returns of diversity."
In the United States, advocacy organizations have long been working with communities and legislators to address the underlying issues in the gender wage gap and close that disparity. Noreen Farrell is the executive director of Equal Rights Advocates, one of these organizations advocating for women, girls, and people of other marginalized gender identities to combat injustice based on gender, race and economic factors. She's also chair of the Equal Pay Today campaign, a national campaign of more than 50 organizations across the country working to close the gender and racial pay gap. She took some time to talk about this global report, what's being done in California to address gender pay disparity, and how her organization has been working to eliminate these gaps. (This interview has been edited for length and clarity. )
Q: The World Economic Forum's report talks about how the current spike in the cost of living is expected to hit women the hardest. Can you talk about some of the reasons why women tend to suffer more under these circumstances?
A: I think what the World Economic Forum has reported on a global scale is very prevalent and consistent with what we're seeing in the United States, as a whole. We are not out front in terms of averages for how these kinds of conditions impact women. What we do know is that, over the course of their professional lives, women lose up to a million dollars depending on their salary because they're not paid the same for equal work, and for other reasons that depress their overall wages. If we were to eliminate the gender wage gap for women in the U.S. today, they would have an entire additional year of child care paid for; a year of tuition and fees at a four-year, public university paid for; more than nine months of rent, seven months of health insurance, and a year's worth of food paid for; and the ability to pay off their student loan debt in four years. This is a significant loss of money that would let them move from living paycheck-to-paycheck to be able to actually have savings to weather extraordinary events that make their lives much more expensive.
A new report that came out from Property Shark [a blog covering news and research on various real estate topics] looks at gender disparities within the homebuyer market in 51 of the largest U.S. cities and how the gender wage gap impacts the ability of women to find affordable housing and actually buy a home. It looks at the local median income of single men and women compared to the local median sale price of starter homes. It showed that single women interested in a starter home would have to spend 49 percent of their monthly income to cover mortgage costs, while single men would have to spend 32 percent. So, because of the gender wage gap, women have less capital at their disposal, or they have to allocate more to housing costs than men would. Of course, that affects their ability to pay all sorts of other kinds of bills. They also found that, as of today, female buyers cannot afford to buy independently in 34 U.S. cities. In Boston, for example, a single woman would have to spend a whopping 98 percent of her monthly income to cover housing expenses, which is up from about 91 percent in five years. [In San Diego, women would have to spend more than half of their wages to purchase a starter home, according to the report.] What we're seeing is that the gender wage gap isn't just about not being paid equally for your work, it's about your ability to just meet your basic needs for yourself and your family in terms of housing, fuel, food, and addressing debt.
Q: Can you talk about what's being done in California to address that gap?
A: In 2015, California passed what was, then, the strongest state equal pay law in the country — the California Fair Pay Act of 2015. It really endeavored to close all of the gaps that we were seeing in various state laws and, frankly, now it is the model for federal legislation in the Paycheck Fairness Act. Since then, California has taken a series of steps to further strengthen that law by prohibiting reliance on prior salary in setting pay, which has been perpetuating historical race and sex discrimination in pay. We have a bill that's pending right now [SB 1162], that would require better reporting of pay data by race, sex and ethnicity that we're putting forward as part of a broader campaign called "Stronger California." It's an economic security campaign that would be the first state law in the country to require very rigorous data reporting. That is part of the problem that I think perpetuates pay inequities.
We're also very committed to lifting up the wages of industries that are dominated by women workers because occupational segregation [when one demographic group is overrepresented, or underrepresented, in specific job categories] is real, and we know that two-thirds of the minimum wage workers in the country are women. So, part of our efforts, in addition to equal pay for equal work, is also raising the minimum wage and making sure, at a federal level, we're abolishing the tipped minimum wage, which is as low as $2.13 an hour for workers in tipped industries. I like to call it the subminimum wage. All of those reforms were incubated in California, and we're trying to replicate them in other states while we're waiting for Congress to get a real picture of what this is doing to our life choices.
Q: The report also ranks how well countries are doing in achieving gender parity in four areas: education, health, political empowerment, and economic participation and opportunity. The U.S. ranks 27th among nations with the largest economies. Why do you think we are ranked further down on this list of 146 countries?
A: I think that, at the federal level, we have not really committed to very common-sense policy reforms that would close the gaps that are very present, like pay transparency and pay data reporting. We also don't have comprehensive paid leave in this country, which forces women out of the workplace, returning to depressed wages, or a wage penalty when leaving the workplace and then coming back. When women leave the workplace and then come back, without having paid leave, there's a study from PayScale that says they are going to be making 7 percent less on that job. We're measuring that closely right now as we're coming out of COVID. There's a refusal to ensure that women can leave the workplace and have their jobs protected. There is a very strong connection between the availability of affordable and quality childcare and the gender wage gap. Other countries provide that, which allows women to stay in the workplace and continue to increase their wages and have a job when they need it the most, which is an important measure of economic security. I think that the U.S. has not gotten on board with core economic justice policies that allow women to be paid equally in the workplace and to remain in the workplace, which is really important for their overall wages over the course of their lives.
Q: You mentioned pay transparency. Can you help people understand what that is and how it can be addressed in ways that would help to close this disparate pay gap?
A: The best example of how pay transparency leads to less disparity in wages between men and women, is in unionized workplaces where there are published pay scales that are negotiated and transparent to all. In those kinds of workplaces, there is not a discernible wage gap that's contributed to potential discrimination or unlawful bias. Here, in California, one of the ways that we continue to improve on that 2015 law, is that we [have Senate Bill 1162], requiring better pay transparency that requires employers to post salary ranges when posting job openings. What's so important about this is there is this incredulous argument that women don't negotiate their pay, but the reality is that they're not given the information that they need in order to know the range of the salary, and what factors place them within that range. When that information is provided, we know that women negotiate better starting wages and better wages for promotion. Companies that are transparent in pay have better outcomes when they're measuring potential gender wage gaps, and they also have better employee morale.
Q: What has Equal Rights Advocates been able to accomplish in its work to eliminate this gap, and what are you currently focusing on as you continue to address this issue?
A: I think that you'll see the major focus of our organization is focusing on pay transparency as a way to help people negotiate equal pay; better pay data reporting by race, sex, and ethnicity so that we can actually determine what's happening in companies without forcing women to have to file lawsuits; and a really important piece of our movement, in terms of the overall wages of women, is really making sure that we're abolishing that subminimum wage for tipped workers, which is the law in California, but not in many other states and not at the federal level. We think raising the wages of women in the lowest paid industries is a huge priority. These are our priorities for the next few years, and they're highlighted in two pieces of federal legislation before Congress — the Raise the Wage Act and the Paycheck Fairness Act. It's slow and steady, but at the rate we're going, it's going to be half a century before we actually reach parity in terms of equal pay for equal work, so we're trying to come at it from a lot of strategies.
An important piece is also looking at the greater care economy and how it impacts women's wages. Coming out of COVID, child care and paid family leave impact the overall earnings of women over their lifetimes. Our view is that no woman should be forced out of work for any period of time because of a lack of affordable child care or paid family leave. In order to keep improving on wages, women have to be able to stay in the workplace, and our country hasn't really made that possible for many. We think the care economy policy reforms are an important piece of closing the wage gap, as well.
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