The Wage Gap

Updated September 9, 2022 | Infoplease Staff

The wage gap is a statistical indicator often used as an index of the status of women's earnings relative to men's. It is also used to compare the earnings of other races and ethnicities to those of white males, a group generally not subject to race- or sex-based discrimination. The wage gap is expressed as a percentage (e.g., in 2013, women earned 78.3% as much as men aged 16 and over) and is calculated by dividing the median annual earnings for women by the median annual earnings for men.

The Equal Pay Act was signed in 1963, making it illegal for employers to pay unequal wages to men and women who hold the same job and do the same work. At the time of the EPA's passage, women earned just 58 cents for every dollar earned by men. By 2013, that rate had increased to 78 cents. Minority women fare the worst. African-American women earn just 64 cents to every dollar earned by white men, and for Hispanic women that figure drops to merely 56 cents per dollar. Asian women are the exception, earning 80 cents for every dollar earned by white men--a sum higher than women of all other races/ethnicities as well as African-American and Hispanic men.

The Institute for Women's Policy Research looked at a 15-year model and found that women's cumulative earnings show a far greater disparity than annual comparisons. Women's lower work hours and their years with zero earnings due to family care certainly are factors affecting the report's findings: women workers in their prime earning years earned 62% less than men, or only $0.38 for every dollar men earned. During that 15-year period, the average woman earned only $273,592 while the average man earned $722,693 (in 1999 dollars).