How has the pandemic affected the pay gap? During the last year, we’ve all faced hardships. Unemployment has skyrocketed. So, how has pay inequality changed from before COVID? And what do we expect the future to look like?
The Pay Gap Has Been Shrinking… Slowly
In 2010, American women who worked full time, year-round, earned 77 cents for every dollar men earned. Before the pandemic, in early 2020, women earned only 81 cents for every dollar the average man-made. In a decade, the gap has only shrunk by four cents.
While progress has been made, it’s not happening fast enough. We need to close the pay gap now.
Promoting gender pay equity isn’t just good for women, it’s good for everyone. Closing the pay gap would strengthen the economy and bolster businesses. Plus, women are more likely to save and invest in their families. When women work, they invest 90 percent of their income back into their families, compared with just 35 percent for men.
If we close the pay gap, it could prompt a cultural shift. With more financially independent women, the demand for socially responsible consumer options could skyrocket. Look at investing, women are more likely to pursue impact investing than men. If women hold more financial power, their preferences are bound to be taken more seriously by the market.
The Pandemic is Widening the Gap
While progress has been slow, it has still been in the right direction. The economic crisis caused by the COVID-19 pandemic threatens to widen the pay gap.
This recession is hitting women harder. Careers disproportionately held by women, such as in-person service jobs at restaurants or retail outlets, have been wiped out by COVID. Companies that relied on in-person consumers can’t afford to pay their staff.
In addition to widening the pay gap, the pandemic is changing the workforce. Women are leaving the workforce at four times the rate as men. Women are often the caregivers in their families. So, when kids are taking classes from home and family members get sick, women are more likely to put their careers on hold for the sake of their families.
Before the pandemic, there was real progress being made to close the pay gap. Now, it’s worsening. What should we expect in the future? And, how can we take action for pay equity?
With the vaccines rolling out and the economy bouncing back, it is likely that women will return to work. But, that doesn’t mean we can sit around and wait for pay equality.
We need to be vocal about the wage gap. Vote for leaders who prioritize women’s issues. Spend our money at companies that value women’s labor. And use our investments to support the causes we’re passionate about.