The global trend towards extreme wealth and income concentration has dramatically strengthened the economic and political power of those individuals — overwhelmingly male — at the top. In the United States and around the world, women continue to be underrepresented in high-level, highly paid positions and overrepresented in low-paying jobs. Women of color and transgender individuals experience particularly high levels of poverty, unemployment, and other economic hardships. Gender discrimination and sexual harassment in the workplace contribute significantly to these persistent economic divides.
As of January 1, 2023, the CEOs of Fortune 500 corporations include 53 women – the largest number in history but still just a tiny fraction of an elite group that earned $18.3 million on average in 2021. By contrast, according to the Bureau of Labor Statistics, women make up 63.5 percent of workers earning the federal minimum wage, a rate stuck at $7.25 since 2009.
Men particularly dominate highly lucrative financial industry jobs. The share of the five largest U.S. investment banks’ senior executives and top managers who are men: JPMorgan Chase: 74%, Goldman Sachs: 75%, Bank of America: 64%, Morgan Stanley: 74%, and Citigroup: 64%. Nationwide, men make up 62 percent of all securities industry employees but just a tiny fraction of workers who provide care services that are in high demand but continue to be very low paid. Men make up just 5.4 percent of childcare workers, an occupation that pays $27,680 per year, on average. Men make up just 13.3 percent of home health aides, who average $28,130 per year.
Men make up an overwhelming majority of top earners across the U.S. economy, even though women now represent almost half of the country’s workforce. Women comprise just 27 percent of the top 10 percent, and their share of higher income groups runs even smaller. Among the top 1 percent, women make up slightly less than 17 percent of workers, while at the top 0.1 percent level, they make up only 11 percent, according to a research published by the National Bureau of Economic Research.
Other major economies show similar trend lines. A study of eight high-income countries from the London School of Economics found that women made up just 14 percent to 22 percent of the top 1 percent of earners. These surveys were conducted during the 2010-2014 period. The U.S. figure for 2012 is from the National Bureau of Economic Research.
Throughout the U.S. workforce, women remain vastly underpaid. Institute for Policy Studies analysis of U.S. Census Bureau Data finds that among full-time workers, women earned an average of 83 cents for every dollar a man earned in 2021, up from 76 cents in 2001. The narrowing of the pay gap has slowed in the past two decades compared to earlier decades when women were joining the workforce in large numbers. If part-time workers were included in these calculations, the gap would be even wider, since women are more likely to work reduced schedules, often in order to manage childbearing and other caregiving work.
Within racial groups, Bureau of Labor Statistics data show the largest pay gaps between men and women appear among whites and Asians — not because Latinas and Black women have made faster progress towards equity but because average pay for men in these groups falls far below the compensation of white and Asian men.
American women earn less than men, on average, in all industries. The largest pay gaps are in management positions, where men made $88,000 on average in 2016, compared to just $55,000 for women. The smallest gap appears in the construction sector, but women make up only 9 percent of workers in this industry.
The U.S. gender pay gap, while unacceptably large, is not the world’s widest. But accurately measuring these gaps across countries can be difficult. Within the OECD group of higher-income nations, South Korea holds the widest gap, with men earning 37 percent more than women, on average. The country with the narrowest gap: Luxembourg, where men make just 3.4 percent more than women. Gaps have been smallest in OECD countries where the share of workers covered by collective bargaining agreements hits at least 80 percent and widest in countries with weak collective bargaining and no or very low minimum wages.
The International Labor Organization concedes that more work needs to be done to develop more accurate global gender gap analyses. One factor skewing the numbers: Women do considerably more unpaid work, from housekeeping to caring for children and the elderly. Among the 21 countries reporting data for at least one year during the 2013-2015 period, the West Bank and Gaza had the greatest imbalance, with men devoting just 16 percent as much time to unpaid domestic and caregiving work as women. Belgium, where men spend 63 percent as much time on these activities as women, ranked at the top.
Since 2017, the UK government has required corporations with more than 250 employees to disclose the pay gaps between the men and women on their payrolls. Large financial firms have among the widest divides because of the scarcity of women in top positions. In 2022, Goldman Sachs International reported the biggest gap in this sector, with women making just 48.7 cents on average for every $1 earned by men at the bank.
Most inequality analysis focuses on income (the wages earned from a job or from capital gains) rather than wealth (the sum of one’s assets minus debts). Income inequality, while stark, pales in comparison to wealth inequality. The divides become even more dramatic when viewed through a gender lens.
At the top end, we have no more striking sign of increasing global wealth concentration than the rise of the billionaire class. The number of individuals with fortunes worth at least $1 billion has more than doubled since 2010, while remaining overwhelmingly male. As of March 1, 2023, only 298 women ranked among the world’s 2,489 billionaires, accounting for less than 12 percent. Ninety-one of them hail from the United States, nearly double the number in any other country.
One important component of wealth, retirement savings, shows an even wider gap between men and women. According to the Transamerica Center for Retirement Studies, American women in 2021 held $43,000 in median retirement savings, compared to $91,000 for men. Some 25 percent of women and 16 percent of men have less than $10,000 in retirement accounts. The gender pay gap contributes to these disparities, since both pension plan and Social Security payouts reflect in part past earnings. In 2021, women’s average annual Social Security benefit of $17,808 lagged the benefit for men by $4,248. The smaller retirement nest eggs of women also have to stretch further than male retirement savings, simply because women have longer life expectancies.
Debt also significantly impacts wealth. Crushing student loan burdens drag many young Americans far into the negative side of the wealth line, with the heaviest for women students. Women comprise 56 percent of college students, but hold nearly two-thirds of outstanding student loan debt, according to the American Association of University Women.
According to the American Association of University Women, black women graduate with the most debt — $30,400, on average — compared to $22,000 for white women and $19,500 for white men.
The gender poverty gap has not improved significantly over the past half decade. In 1966, 12.1 percent of women and 8.4 percent of men aged 18-64 lived below the official poverty line. In 2021, 11.7 percent of women in this age group were living in poverty, compared to 9.3 percent of men. In 2021, the poverty threshold for a single person was $12,880 in annual income. Households led by single women with children faced poverty rates of 31.3 percent that year, more than double the 15.5 percent poverty rate for households led by single men with children, according to the National Women’s Law Center.
Poverty is a particularly acute problem for women of color. In 2021, Native American women had the highest official poverty rate, at 21.0 percent – three times the 7.0 percent poverty rate for white American men. Black women had the second-highest poverty rate, at 18.8 percent, according to the National Women’s Law Center.
Transgender Americans experience poverty at double the rate of the general population, and transgender people of color experience even higher rates. The National Center for Transgender Equality has found that 43 percent of Latino, 41 percent of Native American, 40 percent of multiracial, and 38 percent of Black transgender respondents lived in poverty in 2015.
In 2015, the overall unemployment rate for transgender Americans stood at 15 percent, compared to 5 percent for the general population. The unemployment rate ran even higher for American Indian, Black, Latino, Middle Eastern, and multi-racial transgender Americans.
The impact of the Supreme Court decision striking down Roe v. Wade will have be most severe for low-income people in states with long histories of restricting abortions. As shown by Economic Policy Institute research, many of the states with either trigger laws (which automatically banned abortion upon Roe’s overturn) or pre-Roe abortion bans or restrictions are also states that have not raised their state minimum wage above the federal floor or have rejected federal support to allow Medicaid expansion. Eight states – Georgia, Alabama, South Carolina, Wisconsin, Wyoming, Texas, Louisiana, and Mississippi – have both rejected Medicaid expansion and have a $7.25 minimum wage.
The Covid-19 pandemic has exacerbated long-standing gender inequalities. Women are more likely than men to work in service occupations, including domestic work, restaurant service, retail, tourism, and hospitality, that require face-to-face interactions and have been hard-hit by layoffs. Because of the nature of these jobs, teleworking is not an option for many women.
Frontline jobs, which are the ones most often deemed “essential” and require people to work in-person, are also heavily staffed by women. The health care, social work, and government and community-based services occupations are overwhelmingly made up of women, according to research from the Economic Policy Institute. Women make up 73 percent of government and community-based services workers, 76 percent of health care workers, and 78 percent of social workers.
The official U.S. unemployment rate does not include people who have not looked for work in the past four weeks. Because women tend to bear more responsibility for family caregiving, women with children were more likely than men to drop out of the labor force when schools and care centers closed due to Covid. Rand Corporation research reveals that the steepest decline in labor force participation in the first phase of the pandemic was among women with two children, at 3.82 points, compared to a 1.39 point drop for men with two children. More recently, the shortage of affordable childcare services has emerged as a barrier for women in returning to jobs in restaurants and other low-wage sectors, contributing to staffing challenges.
Among U.S. women who’ve stopped looking for work during the pandemic, the steepest drops have been among women of color. Between February 2020 and November 2021, Black women had a 3.5 percentage point drop in labor force participation and Latinx women had a 2.8 point drop, compared to 1.7 for white women. Several factors may have contributed to women of color becoming discouraged from seeking work. On top of gender inequities, women of color face racial discrimination in hiring and layoffs and they are disproportionately concentrated in service and care sector jobs with high risks of Covid exposure.
Transgender people are always in a precarious position, but the Covid-19 pandemic has made them particularly vulnerable. According to research from the Williams Institute at UCLA, transgender Americans are at a higher risk for Covid-19 for several reasons. They are more likely to be low-income, with 47.7 percent of transgender people living below 200 percent of the official U.S. poverty line, compared to 28.9 percent of the general U.S. population. They are also significantly more likely to suffer from asthma and HIV, conditions that put people at higher risk of mortality if they contract Covid-19. And they experience high barriers to receiving health care.
The pandemic has also hit transgender Americans especially hard economically. A poll from the Human Rights Campaign and PSB Research shows that as of June 2020, 54 percent of transgender people had experienced reduced work hours — more than double the 23 percent of the total U.S. workforce that faced a similar reduction. Twenty-seven percent of transgender people had experienced pay cuts, compared to just 7 percent of the U.S. workforce. And 19 percent had become unemployed due to the pandemic, a significantly larger share than the general population.