How the income inequality gap specifically impacts women and how we can close the gap.

How the income inequality gap specifically impacts women and how we can close the gap.

The value of a woman’s work should never be underestimated or undervalued. Women are half of the workforce yet don’t earn what men do. Women graduate college at higher rates then men yet don’t have the pathways to high-paying fields like men do.  Women with children are the sole or co-breadwinners in more than half of all U.S. households yet don’t have access to the work supports they needs to thrive, such as affordable, high-quality childcare.  

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For Black women in New York State, they earn 63 cents for every dollar earned by white men.  In 2016, The Institute for Women’s Policy Research (IWPR) released an analysis, “The Economic Status of Women in New York State,” that estimated that while progressing at the current rate, the same since 1960, the state’s gender and racial wage gap will not close until the year 2049. Overall, the report found that women earn less than their male counterparts, are more likely to live in poverty, and are less likely to own businesses.  Black women and other women of color are doing far worse than white men and women.

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Women Are Essential: At Work and At Home

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Black women are most often the first and only caregivers for children and elders in their lives. In 2016, The New York Women’s Foundation released an issue brief entitled, “Addressing the Economic Security & Well Being of Low-Income Mothers in NYC” that showed that in New York City, single, childless women under age 35 earn 96 cents for every dollar earned by men, whereas women ages 35 to 65 who are likely to have children and more caregiving responsibilities, earn only 78 cents on the dollar. Research shows that this ‘caregiving penalty’ affects all working women, but that it affects low-wage women workers most acutely and severely, with each new child bringing a pay penalty of 15 percent, compared to 4 percent for higher-wage mothers. The demands of caregiving push women out of the workforce during their prime earning years. In the short-term, it prevents women from meeting their families’ basic needs around shelter, food and healthcare, forcing them to depend on public assistance. In the long run, it jeopardizes their long-term earning potential, asset building, and subsequent social  security payments in old age, thus perpetuating the cycle of intergenerational poverty.

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To continue to work while caring for others, women have to pay for dependent care, which are costs that are high and rising. According to the Economic Policy Institute, childcare costs in New York costs approximately $12,000 to $15,000 a year.  Elder care costs range from $52,000 to $96,000 per year. According to AARP, out-of-pocket caregiving costs are highest among Latinx (44%) and Black (34%) caregivers than white caregivers (14%). Women take from their savings and retirement funds to cover these costs. Low-wage working mothers in particular have limited options and supports available to manage their dependent care responsibilities while they are on the job. 

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Furthermore, the gender wage gap continues to persist, because women have diifficulty accessing living wage, sustainable career paths.  In NYC, about 1 in 4 women in female-headed households in NYC drop out of high school and 31 percent had a high school diploma, placing them at huge disadvantage for achieving well-paying jobs. Many women are employed in low-paying retail and service sector jobs with limited opportunities for advancement, such as Health Aides and Cashiers with median earnings at $21,450 and $20,030 respectively; more than 25 percent do not have health insurance, paid sick leave or pensions.

Fight to Close The Gender Income Gap

The income inequality gap can be closed if we continue to fight for pay equity. Women should be paid equal pay for equal work. However, for many women, they are not even in place to have the opportunity to compete on equal footing with men for the same income.  As such, additional strategies should be pursued to achieve wage parity, such as:

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• Create pathways to higher paying jobs in high-growth, high-demand sectors.  Assist women to complete high school, pursue higher education, and receive quality adult education and English as a Second Language instruction. It is also important to increase women’s access to middle skill and living wage employment opportunities. In order to move women toward full economic security and participation in New York City, workforce development training programs will need to focus on jobs in high demand fields that have the potential for higher wages and earnings over time and that have clear pathways for advancement.

• Support women to launch and grow thriving businesses.  Women, particularly women of color, can also achieve income parity with men if given the same opportunity to start businesses.  Gaining access to capital, business education/training, and mentorship can put a women on her way to growing a business that generates significant income and wealth.

• Support women’s stability and prosperity in the workplace. Expand access to high quality childcare and early childhood education for low-income children. Expand worker control of schedules in the retail and service-industries, which creates financial stability for low-wage workers, especially those with children, as they undermine a mother’s ability to count on steady income, secure consistent and quality childcare, and engage in secondary education opportunities needed to gain better employment. Ensure access to universal paid sick and family leave so women will not be at a financial loss to care for themselves or their loved ones.

• Focus on building women’s wealth. To truly achieve economic security for women, the focus should not only be on income but on strengthening long-term financial stability by building women’s wealth.  As women find pathways to increasing their income, they also need opportunities to save, invest and reduce debt. 

Economic security for women can and will be achieved if we center the needs of the most marginalized and fight for the pathways to opportunity and supports that are needs for women to thrive.