The Gender Wage Gap: 2017; Earnings Differences by Gender, Race, and Ethnicity

Ariane Hegewisch, M.Phil.

September 13, 2018
  • ID: C473

The Gender Wage Gap: 2017

Earnings Differences by Gender, Race, and Ethnicity

The ratio of women’s and men’s median annual earnings was 80.5 percent for full-time/year-round workers in 2017, unchanged since 2016.[1] This means a gender wage gap for full-time/year-round workers of 19.5 percent. Women’s median full-time, year-round earnings in 2017 were $41,977 compared with $52,146 for men; both women’s and men’s earnings were 1.1 percent lower in 2017 than in 2016.[2]

 

If the pace of change in the annual earnings ratio continues at the same rate as it has since 1960, it will take another 41 years, until 2059, for men and women to reach parity.[3]

 

An alternative measure of the wage gap is derived from the ratio of women’s to men’s median weekly earnings for full-time workers, which was 81.8 percent in 2017. The annual gender earnings ratio for full-time year-round workers, which includes self-employed workers, tends to be slightly lower than the ratio for weekly earnings (which excludes the self-employed and earnings from annual bonuses, and includes full-time workers who work only part of the year). The the gender earnings ratio based on weekly earnings also remained unchanged between 2016 and 2017 (Figure 1).

 

Figure 1. The Gender Earnings Ratio, 1955-2017, Full-Time Workers

Figure 1. The Gender Earnings Ratio, 1955-2017, Full-Time Workers

Notes: See Table 2

 

Both earnings ratios (for weekly and annual) reflect gender differences in hourly wages and the number of hours worked (among full-time workers); 63.0 percent of women with earnings worked full-time, year-round in 2017, compared with 75.4 percent of male workers, a slight increase for both genders compared with 2016.[4]  If part-time and part-year workers were included, the ratio of women’s to men’s earnings would be lower, as women are more likely than men to work reduced schedules, often in order to manage childrearing and other caregiving work. Women are also more likely than men to work in occupations where fewer jobs are offered on a full-time basis or where hours vary from week to week.[5]

 

Real median full-time, year-round earnings marginally declined for women of all of the largest racial/ethnic groups (Table 1). Earnings for Black women working full-time, year-round decreased by $271 or 0.7 percent, Asian women’s and Hispanic women’s by 0.6 percent (by $325 and $198 respectively), and White women’s by $212 or 0.5 percent. With the exception of Black men, whose real median full-time, year-round earnings marginally declined, men of the other largest racial/ethnic groups saw a marginal increase in earnings.  Women of all major racial and ethnic groups earn less than men of the same group, and saw greater declines in real earnings than men of the same race or ethnicity.

 

When the gender earnings ratio is measured using White men’s earnings as the comparison, it shows marked disadvantage for Hispanic and Black women. Hispanic women earned just 53.0 percent (compared with 54.4 in 2016) and Black women earned just 60.8 percent (down from 62.5 percent in 2016) of White men’s median annual earnings in 2017 (Table 1). Median earnings for a year of full-time work for Hispanic women are below the qualifying income threshold for eligibility for food stamps for a family of four; in 2017 this was $32,315 per year, 130 percent of the federal poverty threshold for a family of four.[6]

 

Black and Hispanic workers of both sexes earn considerably less than White and Asian workers; as a result, the gender earnings ratio based on earnings of women and men of the same race or ethnicity is higher than the ratio for workers of all races considered together, meaning the within-race gaps are narrower. The gender earnings gap based on comparison with men of the same race/ethnicity widened for all groups in 2017. The gender earnings ratio for White workers decreased from 79.0 percent in 2016 to 77.0 percent in 2017, for Black workers from 87.5 to 87.3 percent, for Asian workers from 76.9 to 75.9 percent, and for Hispanic workers from  84.4 to 82.3 percent (Table 1). Asian workers as a group have the highest median annual earnings, primarily because of historically higher rates of educational attainment for both genders.

 

Table 1. Median Annual Earnings and Gender Earnings Ratio for Full-Time Year-Round Workers age 15 Years and Older by Race/Ethnicity, 2016 and 2017

Table 1. Median Annual Earnings and Gender Earnings Ratio for Full-Time Year-Round Workers age 15 Years and Older by Race/Ethnicity, 2016 and 2017

Notes: White alone, not Hispanic; Black alone; Asian alone; and Hispanic/Latina/o (may be of any race). Source: U.S. Census Bureau, Current Population Survey. 2018. “Historical Income Tables: Table P-38. Full-Time, Year-Round Workers by Median Earnings and Sex.” <https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-people.html>

 

Closing the wage gap is not a zero-sum game—gains for one gender do not require losses for the other. For the gender wage gap to close, women’s real wages must rise faster than men’s, and as the economy becomes more productive, one would expect real wages to rise for both men and women. Yet, as can be seen from Table 2, since 1975 real annual earnings for men have remained virtually unchanged, and are lower in 2017 than they were in 1975, while women’s real earnings have increased across the same time period (but are also only maginally higher than they were a decade ago, in 2007). Over the same period, women’s earnings have become increasingly important to family incomes.

 

Table 2: The Gender Wage Ratio and Real Earnings, 1955-2017, Full-Time Workers

Table 2: The Gender Wage Ratio and Real Earnings, 1955-2017, Full-Time Workers

Notes for Figure 1 and Table 2: Annual earnings data include self-employed workers; weekly data are for wage and salary workers only. Annual earnings are for people 15 years old and older beginning in 1980 and people 14 years old and older as of the following year for previous years. Before 1989 annual earnings are for civilian workers only. Weekly earnings are for full-time civilian workers aged 16 and older in and are not restricted to full-year workers. Full-time is work for at least 35 hours per week, full-year for at least 50 weeks per year. Annual median earnings data are typically released in September by the U.S. Census Bureau, and the annual average of weekly median earnings in February by the U.S. Bureau of Labor Statistics. Both data series are derived from the Current Population Survey. Adjustments for data from earlier years to 2017 dollars are computed on the basis of the Consumer Price Index Research Series (CPI-U-RS); U.S. Bureau of Labor Statistics < https://www.bls.gov/cpi/research-series-allitems.pdf > (accessed August 2018). From 2014 onwards, the Census Bureau has used revised questions on income and earnings; in 2013, data was collected using both the old and the new questions; the gender earnigs ratio under the old methodology was 78.3 percent, und the new methodology 77.6 percent.6 Sources for Figure 1 and Tables 1 and 2: Annual data: 1955: Francine D. Blau and Marianne A. Ferber, The Economics of Women, Men, and Work, 2nd ed. (Englewood Cliffs, NJ: Prentice-Hall, 1992); 1960-2017 U.S. Census Bureau, Current Population Survey, 2017 Annual Social and Economic Supplement Table P-38. Full-Time, Year-Round Workers by Median Earnings and Sex: 1960 to 2017; <https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-people.html> (retrieved September 2018). Weekly data: U.S. Bureau of Labor Statistics. 2018. “Table 17. Inflation-adjusted median usual weekly earnings, by age, for full-time wage and salary workers, 1979-2017 annual average.” Highlights of Women’s Earnings 2017 < https://www.bls.gov/cps/earnings.htm> (accessed August 2018).

 

 

Notes

This fact sheet was prepared by Ariane Hegewisch at the Institute for Women’s Policy Research. Financial support was provided by the Annie. E. Casey Foundation and the Ford Foundation. 

 

The Institute for Women’s Policy Research (IWPR) conducts and communicates research to inspire public dialogue, shape policy, and improve the lives and opportunities of women of diverse backgrounds, circumstances, and experiences. The Institute’s research strives to give voice to the needs of women from diverse ethnic and racial backgrounds across the income spectrum and to ensure that their perspectives enter the public debate on ending discrimination and inequality, improving opportunity, and increasing economic security for women and families. The Institute works with policymakers, scholars, and public interest groups to design, execute, and disseminate research and to build a diverse network of individuals and organizations that conduct and use women-oriented policy research. IWPR’s work is supported by foundation grants, government grants and contracts, donations from individuals, and contributions from organizations and corporations. IWPR is a 501(c)(3) tax-exempt organization that also works in affiliation with the Program on Gender Analysis in Economics at American University.

 

[1] Kayla R. Fontenot, Jessica L. Semega, and Melissa A. Kollar. 2018. “Income and Poverty in the United States: 2017.” Current Population Reports P60-263; Table A-4.  U.S. Census Bureau. Please note that rounded percents are 80 percent for the wage ratio and 20 percent for the wage gap.  <https://www.census.gov/content/dam/Census/library/publications/2018/demo/p60-263.pdf> (accessed September 2018).

 

[2] Jessica L. Semega, Kayla R. Fontenot, and Melissa A. Kollar. 2017, op.cit., p.1; the changes are not statistically significant.

 

[3] Institute for Women’s Policy Research. 2017. “Women’s Median Earnings as a Percent of Men’s Median Earnings, 1960-2017 (Full-time, Year-round Workers) with Projection for Pay Equity in 2059. IWPR Publication #Q073 <https://iwpr.org/publications/pay-equity-projection-1960-2017/>.

 

[4] Jessica L. Semega, Kayla R. Fontenot, and Melissa A. Kollar, op. cit. p.10.

 

[5] Elyse Shaw, Ariane Hegewisch, Emma Williams-Baron, Barbara Gault. 2016. Undervalued and Underpaid in America: Women in Low-Wage, Female-Dominated Jobs. IWPR Report #D508. Washington, DC: Institute for Women’s Policy Research <https://iwpr.org/publications/undervalued-and-underpaid-in-america-women-in-low-wage-female-dominated-jobs/> (accessed September 2018).

 

[6] The federal poverty threshold for a household of four in 2017 was $ 24,858 (U.S. Census Bureau. 2018. “Poverty Thresholds: by Size of Family and Number of Related Children Under 18 Years.” < https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-poverty-thresholds.html > (Accessed August 27, 2018). At 130 percent of poverty (the threshold relevant for food stamp eligibility) this is $32, 315 annually, or $621 per week (assuming full-time work for 52 weeks).