Pay Women — Especially Mothers — Their Fair Share

An aspirational vision of a humane economy


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Nearly 100 years ago, when my Iranian grandmother and her sisters barely completed elementary school education, no one raised an eyebrow. After all, boys would eventually become breadwinners and, with a dearth of resources, their education took priority. My grandmother always wished that the privileges afforded to boys were rights bequeathed to girls, and so she instilled in her daughters the importance of becoming a learned person with financial autonomy — a value that my mother passed on to my sister and me.


Three generations later, women’s striking progress and vast contributions are worth celebrating. But when the pandemic revealed our still grossly gendered experiences, I thought about my middle-school-aged daughter. In the U.S. in 2021, her brother’s schooling will not take priority over hers. But my daughter’s economic trajectory will not equal her brother’s. She — like me, my mother, my sister, and my grandmother — live in a world that is still mercilessly unfair to women.


When you stitch it together, this is how it plays out. On average, women earn $0.82 for each $1 a man earns. As you might expect, women of color, Hispanic or Latino, especially have a low earnings ratio ($0.54). Playing catch-up becomes a steep, near-impossible climb. So it’s no surprise to know that more women live in poverty than men.


This gendered short-end-of-the-stick traps us throughout our careers and even after we leave the workforce. Over the course of a 35-year career, an American woman with a college degree will make $1.2 million less than a man with the same education. Collectively, in some professions, females earn billions less than their male colleagues — female physicians and surgeons are paid $19 billion less annually than men in the same occupation. And because women typically start at lower salaries, new employers will use their previous salaries to set new compensation, compounding diminished lifetime earnings. Lowered earnings lead to smaller pension and Social Security benefits. Women’s retirement income is 70 percent that of men's.


Whatever the reasons, and I don’t tread on them lightly, for this pay gap — gender discrimination, educational and professional segregation, or lack of pay transparency — one stands out as especially fraught. Motherhood. Women who have children — compared to those who don’t — have materially different earnings paths, a 20 percent penalty. In contrast, men’s earnings after having children remain unchanged. The professional penalty for childbearing is devastating.

Women regularly leave the workforce to care for children and take part-time work while also managing the perceptions about motherhood. Our perceived abilities corral us into cages.


But this treatment isn’t just bad for women. It’s also a drag on the economy’s full potential. Before the pandemic, McKinsey and Co. reported that more equal pay for women would increase the global GDP by 26 percent, or $28 trillion, by 2025. During the pandemic, women with children left the labor force in droves, costing $65 billion per year in lost wages and economic activity.


Affecting a sea of change will require agile collaboration with federal, state, and local legislators, media outlets, academic institutions, and corporations.


Institutionalizing regulatory and legislative remedies that would have an outsized impact are listed below:


· Offer tax credits to companies who hire women and give them access to jobs traditionally held by men. Hawaii’s Feminist Economic Recovery Plan is a model worth studying. Motivating companies to engage men and women as active members of diversity and recruitment efforts with ROI targets is an important first step, but promoting women into managerial roles is crucial. Women’s successful climb on the professional ladder increases innovation performance when over 20 percent of management positions are held by women.


· Enact flexible, hybrid, or part-time work arrangement policies, with the explicit aim of supporting men who also partake in domestic or child-raising activities. Policies like these engender more productive teams. A Harvard Business Review study noted that during the COVID crisis, many teleworking men got a crash course in learning to balance work and family obligations. Men sharing more fully in domestic duties for an extended period has the potential to change gendered norms because these men are more likely to understand the value of flexible work arrangements. In Finland, the Working Hours Act gives employers the flexibility to agree to varied work arrangements with employees.


· Build sustainable, affordable, high-quality childcare facilities. The lack of and high costs associated with childcare — in some states, it’s close to that of annual college tuition — are prohibitive, leading many parents to forgo schooling and employment opportunities. Lack of affordable childcare is also costly for states. On average, before the pandemic, states were losing $1 billion in economic activity because of the breakdown in childcare.


· Modernize social security by providing workers with paid family leave and crediting unpaid family caregivers with retirement benefits. This measure goes to the heart of improving family economic security. A quarter of families who filed for bankruptcy in 2001 did so because of missing one to two weeks of work, either because of a worker falling ill or a worker having to care for an ill family member. Modernizing Social Security will help reflect present-day family structures and workforce participation. There is dignity in all work, including unpaid work. Reviewing the different models of this component used in EU countries and the way they target specific objectives is a good start. Another excellent step would be to offer tax credits to small businesses to help cover the incremental payroll costs related to providing paid leave.


· Put living wage back on the drawing board. In 2019, living wages for a family of four were $16.54 per hour. A single mother of two earning the current federal minimum wage ($7.25 per hour) needs to work 138 hours per week to earn a living wage. Lifting families out of poverty will lessen dependence on public assistance such as homeless programs or food stamps. When 26 of the 30 top-paying jobs are male-dominated, while 23 of the 30 lowest-paid jobs are female-dominated, a gradual increase to $15 per hour by 2025 is the least we can do.


In 1971, Ella Grasso, the first female U.S. governor, said “History shows that women cannot rely on the courts to achieve their rights… Indeed, Congress must provide a constitutional framework upon which to build a body of law to achieve the goal of equal rights.” Women should be explicitly protected under the laws of the nation. It befits us to add the Equal Rights Amendment (ERA) to our constitution. The ERA would provide lawmakers with a context to highlight policies that intentionally or unintentionally harm women and critically assess laws that should be repealed or expanded.


Tomorrow must be different. If we’re not moved by the moral imperatives of a fair society, then we must see the value proposition when all the levers in our economy are at work.

An aspirational vision of a humane economy benefits us all. Let this be the last time any generation gasps for egalitarian laws and practices around gender. Call it a capital investment.


Please see parts one and three of this three-part series article: Post-pandemic Recovery Plan Must Include Women and Include Women in the Sequel

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