Inflation and stagnant wages have formed the perfect storm that has hit the gender wage gap in 2023. The Federal Reserve has taken significant steps to boost the U.S. economy and contain inflation, but the current inflation rate of 6.4%, according to the Bureau of Labor Statistics (BLS), is still more than three times higher than the Fed’s target of 2%. For women, the longer it takes to tame inflation, the bigger the risk to gender equality in terms of the wage gap.
The Intersection of Inflation and Stagnant Wages
The rising cost of living coupled with stagnant wages is creating a dire situation for women across the country. A 2022 national survey indicates that men are 33.3% more likely than women to receive salaries that keep pace with inflation in the U.S. Such a disparity has the potential to exacerbate the already-existing gender wage gap.
Current Wage Landscape
The wage gap, though improved somewhat over the past two decades, still has a long way to go. Educational attainment and increased pay transparency in the workplace have helped narrow the gap slightly. However, the progress is not enough, and more needs to be done.
In 2022, women earned an average of 82% of what men earned, according to a recent analysis by the Pew Research Center. The analysis considered median hourly earnings of full- and part-time workers, indicating a slight improvement from 80% in 2002. While this suggests a move in the right direction, more significant progress is necessary to bridge the gap completely.
A Lean In report indicates that Black women, Native American women, and Latinas face an even steeper climb to economic equality, earning 36%, 49%, and 54% less than their male counterparts, respectively.
The U.S. Census Bureau’s latest data paints a slightly more encouraging picture, although the analysis considers only full-time workers. The data shows that in 2021, full-time, year-round working women earned 84% of what their male counterparts earned on average.
Addressing the Issue
The wage gap is a persistent issue that demands a robust response. While the factors contributing to the wage gap are many, inflation and stagnant wages have the potential to widen the gap further. It is critical to act swiftly to contain inflation, increase wages, and implement policies that promote gender equality.
