One Year After College, Women Already Earn Less Than Men: Study

 @ashleyportero on October 24 2012 7:04 PM
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    U.S. auto sector. Reuters
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    President Obama signs the Lily Ledbetter Fair Pay Act of 2009. Reuters
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It is widely recognized – even accepted – that women in the workplace typically earn less than their male peers. But despite the enormous gains women have made in education, employment and earnings in the past 50 years, a report released Wednesday by the American Association of University Women found that gender pay disparity begins just as young people are launching their careers.

Just one year after college, female graduates only earn 82 cents for every dollar earned by their male colleagues, according to the report. Using data from an Education Department survey of about 15,000 college graduates with bachelor's degrees, the study authors concluded the average full-time female worker earned $35,296 while men were paid an average of $42,918. Even when male and female students graduate with the same major from the same college and enter the same industry, women stand to bring in 7 percent less – and that wage gap only increases as time goes on.

“In this election, jobs and the economy are top priorities.  For women it’s not just about getting a job; it’s about getting fair and honest pay,” said AAUW Executive Director Linda Hallman. In an election that has put a greater emphasis on the nation’s stubborn wage gap – Cornell labor economist Francine Blau sets the current national gap at an average of 77 cents on the man’s dollar – Hallman said it is particularly poignant that female graduates also must devote more of their income to repaying student loans, often because of the pay discrepancy in question.

For the class of 2008, the average amount of student loan debt was about $20,000, an amount that did vary significantly among genders (although the report notes women were more likely to take out loans). But because of pay discrepancies, nearly half of women (47 percent) were paying more than 8 percent of their income toward repaying student loan debt, compared with 39 percent of men.

“Men and woman have a good deal in common at this point of their careers,” said Dr. Catherine Hill, a report co-author and AAUW director of research. “We expected their earnings would be more similar than the statistics you see with the population at large.”

In engineering, technology, computer science and social sciences fields, researchers found that women made between 77 percent and 88 percent of what men in the same position earned. In fact, the overall wage gap could be explained by career choices.  Men are more likely to major in fields such as engineering and computer science, while women gravitate toward education and the social sciences, which typically pay less.

But that still does not account for the 7 percent wage gap among men and women making the same educational and occupational choices.

While the authors hypothesized that the numbers of hours worked may contribute to the pay gap – one year out of college, women in full-time jobs reported working an average of 43 hours of week, while men reported 45 hours – when they compared the earnings of those who reported working the same number of hours, men still earned more than women.

Blau said that indicates the pay gap is not merely the result of women’s choices. And it can set into a motion a chain of disparities that could ultimately plague a woman throughout her career. For example, Blau pointed out that, among couples, it makes more economic sense for the lower-earning spouse to take more time off in the event of childbirth. That person may not always be the woman -- but more often than not, it is.

What can be done to bridge the difference? First, the AAUW says women to need to pay attention to the salaries associated with the college majors and occupations they are interesting in exploring so they can understand the long-term financial implications of those decisions. They should also negotiate with employers to improve their base salary; multiple studies indicate women are considerably less inclined to negotiate for a better offer.

And while federal equal pay laws have laid the groundwork toward closing the pay gap, new legislation is needed to strengthen these laws. In particular, the authors have called for the passage of the Paycheck Fairness Act, which would expand the scope of the Equal Pay Act of 1963 to make it easier for victims of wage discrimination to address the issue, allow employees to disclose salary information with co-workers and require employers to demonstrate that any pay discrepancies are not based on gender.

The legislation has been rejected twice by the U.S. Congress. In June, it was blocked by Senate Republicans in a 52 to 47 vote.

 

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