Why Has The Gender Pay Gap Doubled In Two Years?

• Despite efforts to address it, the gender pay gap persists and has widened significantly in recent years, with women earning less than men as they progress in their careers.
• There are notable disparities in certain fields, such as STEM, where women earn significantly less compared to men, while fields like Accounting and Banking & Finance show some progress towards pay equity.
• Addressing the gender pay gap requires coordinated efforts from policymakers, employers, and individuals, including implementing pay audits, standardizing compensation practices, promoting family leave policies, and fostering mentorship and leadership opportunities for women.

The gender pay gap just isn’t closing. 

There is no definitive explanation as to why the wage disparity between men and women has stagnated these last 20+ years. Although women typically begin their careers earning wages comparable to their male counterparts, over time, as they age and progress in their careers, a gap in salaries emerges — with women’s earnings falling behind those of men.

A typical woman working full-time would need to work from January 1, 2023, until March 12, 2024, to match the earnings of a typical man working full-time during 2023, according to the U.S. Department of Labor. This wage disparity is consistent across all major racial and ethnic groups.

A woman needs to attain at least one more educational qualification to earn an income comparable to a man with a lower level of education. For example, on average, a woman holding an advanced degree earns less than a man possessing just a bachelor’s degree. If women did not pursue higher levels of education more frequently than men, the gender wage disparity would be even more pronounced.

How bad is it, really? 

The gender pay gap in the U.S. is not simply just not closing, it’s actually getting exponentially worse. The gap has more than doubled over the past two years; according to data from Adzuna, the gender pay gap increased from 2.9% in April 2022 to 6.0% in April 2024.

The recent study highlights several key findings:

1.Widening Gender Pay Gap

There are a few factors to consider why the pay gap has doubled since 2022. 

“I believe there’s two main reasons for this increasing gap,” James Neave, Head of Science Data at Adzuna, told Allwork.Space. “The first is a time-lagged effect from COVID-19, where the pandemic disproportionately affected women since they were more likely to reduce working hours due to childcare needs. The second is the pay-gap is widening at more senior levels, and very high salaries can skew mean salary data disproportionately.”

Not only is the pay gap widening at senior levels, the number of women in those roles remains low. As recently reported, “Despite constituting 47% of the U.S. labor force, women remain outnumbered in the highest-paying occupations, comprising only 35% of workers in such roles. Reflecting this disparity, women occupy only 11% of Fortune 500 CEO positions and 28% of U.S. Congressional seats.”

2.STEM Gender Pay Disparities

Women in STEM fields, particularly in Science and Engineering, continue to face notable pay disparities. As of March 2024, women in Science earned 87 cents, and women in Engineering earned 90 cents, for every dollar earned by men.

3.Progress in Accounting and Banking & Finance

There has been meaningful progress toward gender pay equity in Accounting and Banking & Finance. In March 2024, women in Accounting earned $1.04 for every dollar earned by men. Additionally, the gender pay gap in Banking and Finance reduced to 1.4%.

4.Legal and Marketing Sector Pay Gap Significantly Shifts

The Legal sector experienced a sharp increase in its gender pay gap, rising by 11 percentage points. Conversely, the Marketing sector saw a significant shift, with men earning 7% more than women on average by March 2024.

Can Anything Be Done? 

To effectively address this issue, it requires the concerted efforts of policymakers, employers, and individuals. 

Steps for Policymakers

Steps for policymakers to address gender inequality in the workplace can include implementing and enforcing equal pay legislation, such as the Equal Pay Act and the Lilly Ledbetter Fair Pay Act in the United States, which are crucial for ensuring that individuals receive equal pay for equal work. 

Another important measure is instituting paid family leave policies, which help mitigate the negative career impacts of familial responsibilities, disproportionately affecting women, by encouraging a more balanced sharing of domestic duties. Lastly, expanding access to affordable, high-quality childcare services can significantly enable more women to participate fully in the workforce, further promoting gender equality.

Steps for Employers

Regularly conducting comprehensive pay audits is a crucial first step to identify and rectify any existing disparities and to ensure transparency and accountability in pay structures. Standardizing compensation practices, including starting salaries and pay raises, helps to reduce subjectivity and limit opportunities for bias. 

Standardizing compensation practices, including starting salaries and pay raises, helps to reduce subjectivity and limit opportunities for bias.

Developing mentorship programs and leadership training focused on women can foster retention and career advancement, making senior roles more accessible. Finally, offering flexible work arrangements, such as flexible hours and remote working options, can support work-life balance and enable all employees, particularly those with caregiving responsibilities, to thrive in their roles.

“Looking forward, if we don’t implement targeted interventions, this gap is unlikely to shrink or disappear. Employers who leverage data-driven insights to shape hiring practices and compensation structures will not only see a more diverse and inclusive environment but will also attract top talent who value transparency and fairness,” Neave said. “Additionally, educational and mentor programs aimed at supporting women in the workplace can help bridge the gap by preparing more women to enter and thrive in fields such as STEM.”

Steps for Men

1. Advocate for Equality: Men can support gender parity by advocating for equitable practices within their workplaces, such as supporting pay audits and fair hiring practices.
2. Share Domestic Responsibilities: By taking an equal share of domestic responsibilities, men can help reduce the career impact on women caused by traditional gender roles.
3. Mentor and Support Female Colleagues: Men in leadership positions can mentor female colleagues and advocate for more women in leadership roles.
4. Challenge Gender Stereotypes: Actively challenging gender stereotypes and biases in professional and personal settings can contribute to cultural change.

Additional Considerations

Broader cultural shifts towards valuing diversity and inclusion are essential. This can be created through awareness campaigns and educational initiatives.

It’s also important to recognize the intersectionality of gender with other identities such as race, socioeconomic status, and sexual orientation. Efforts to close the pay gap should consider these overlapping forms of discrimination to be truly effective.

Addressing the gender pay gap is not a one-size-fits-all solution but rather requires an integrated approach that tackles root causes and symptoms from multiple angles. Progress depends on sustained commitment and coordinated actions from all sectors of society.

“The path to closing the gender pay gap requires concerted effort from all stakeholders, including employers, policymakers, educators, and the workforce itself,” said Neave. “By continuing to highlight these issues and providing actionable solutions, we can work towards a future where gender pay equity is not just a dream but a reality.”