A 2.6pc gender pay gap can cost a woman as much as $500,000
The issue of the gender pay gap remains a contentious issue. Detractors will question the validity of claims that such gaps exist. Where the gap cannot be denied, they may be inclined to argue that these gaps aren’t as drastic as people may think.
In the medical profession in the US, for example, female physician researchers make between 7pc and 8pc less a year than their male counterparts. A study conducted by the Johns Hopkins University School of Medicine has shown just how stark a difference a single-digit gap can make over the years. If a woman is paid even 2.6pc less than a man, it can cost her $500,000 over her lifetime.
“1.5 or 2pc doesn’t sound so bad to most people but, at the end of the day, we’ve shown that this is really a lot of money,” said Barbara Fivush, professor of paediatrics at Johns Hopkins Children’s Center, and senior associate dean of women in science and medicine at the School of Medicine.
The research, which was published on JAMA Network Open, used multiple factors to calculate wealth accumulation – such as how much the faculty makes, time between promotions and the effect of salary on retirement – to arrive at the final six-figure conclusion.
As per the calculations, a woman hired in 2005 would accumulate $501,416 less in eventual salary and investment returns than a man hired at the same time if she is compensated 2.6pc less.
If between 2006 and 2016 this same woman’s pay was augmented to further close the gap to a mere 1.9pc less, she would get more money. However, she’d still accrue $210,829 less.
Though the researchers acknowledge that their simulations make a number of assumptions and wouldn’t necessarily mirror perfectly a person’s meandering career path, it still warrants grave reflection.
“What’s important to take away from this is that the impact of even a small gap is still seen 30 years later, suggesting that interventions to address such inequities should not be delayed,” said Sara Alcorn, assistant professor of radiation oncology and molecular radiation sciences at the Johns Hopkins Kimmel Cancer Center, and a senior author of the paper.
Alcorn stated that in some areas, the gap is likely even larger than the one projected in these findings. She also notes that pay gaps “likely exist” in racial minority groups, though the current research dealt exclusively with gender disparities.
This study comes just as the US Democratic lawmakers reintroduced the Paycheck Fairness Act, an effort to close the gender pay gap that Democrats have been trying to push through for 20 years. The proposed bill would further the existing protections in the Equal Pay Act of 1963 and the Fair Labor Standards Act.
Among the new measures, the bill would ban salary secrecy, increase penalties for employers who retaliate against workers who share wage information, and allow workers to sue for damages in instances of pay discrimination.
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