Gender and Income Inequality: History and Statistics

The wage gap, also known as the “gender wage gap” or “gender pay gap,” refers to the disparity in incomes between men and women for doing the same work. The wage gap is also used to describe pay disparities between White workers and Black and Latinx workers, as well as between workers in the U.S. and in other countries. This article focuses on the wage gap as it relates to gender in the U.S.

Early History of the Wage Gap

Though the gender wage gap probably dates to the beginnings of civilization, it emerged as a political issue in the U.S. in the 1860s under the rallying cry of “Equal Pay for Equal Work.”

Among the movement’s most vigorous advocates were women’s rights activists Susan B. Anthony and Elizabeth Cady Stanton, who made a case for bridging the wage gap in their newspaper, The Revolution, and other works.

Women eventually won the right to vote in the U.S. with the ratification of the 19th Amendment to the Constitution in 1920. Nevertheless, the wage gap persisted.

The 1940s: A Failed Attempt to Bridge the Gap

In 1944, Winifred Claire Stanley, a Republican member of Congress from New York, introduced a bill titled "Prohibiting Discrimination in Pay on Account of Sex." It would have amended the list of unfair labor practices in the National Labor Relations Act of 1935 to include discriminating “against any employee, in the rate of compensation paid, on account of sex.” Stanley’s bill never made it through Congress.

The 1960s: Major Strides for Equal Pay and Civil Rights

The next major attempt to address the inequity on a national level came two decades later, with the passage of the Equal Pay Act in 1963. It prohibited employers from paying male and female workers different wages for “jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions.” However, it also allowed for several exceptions, including pay structures based on seniority or merit.

In signing the bill into law, then-President John F. Kennedy said that paying men and women different wages for the same work was an “unconscionable practice” and cited a statistic that “the average woman worker earns only 60% of the average wage for men.”

A year later, in 1964, Title VII of the Civil Rights Act also addressed the wage gap, broadening the law to make compensation decisions based on race, color, religion, sex, or national origin unlawful. As with the Equal Pay Act, there were multiple exceptions, again including seniority- and merit-based wage programs.

The 1970s and 1980s: A Call for Comparable Worth

In the 1970s and '80s, the concept of comparable worth, or pay equity, entered the national conversation. Its proponents called attention to wage gaps among workers in jobs that, while not identical, could be considered similar in terms of skills, responsibility, and value to the overall enterprise. Often, they argued, those gaps were a legacy of past discrimination.

“Many women and people of color are still segregated into a small number of jobs such as clerical, service workers, nurses, and teachers,” the advocacy group National Committee on Pay Equity explained. “These jobs have historically been undervalued and continue to be underpaid to a large extent because of the gender and race of the people who hold them.”

Eleanor Holmes Norton, chair of the Equal Employment Opportunity Commission (EEOC) during the Carter administration, singled out comparable worth as “the issue of the 1980s.” However, the Reagan administration, which came next, firmly opposed it. Then-President Ronald Reagan reportedly called it “Mickey Mouse, a cockamamie idea...[that] would destroy the basis of free enterprise.” Pay equity and comparable worth made little progress on the federal level but did become law in several states.

The 2000s: Win Some, Lose Some

During the 1990s, there were no major changes in the laws around payment by gender. The gender wage gap continued to shrink, but not converge.

A 2007 U.S. Supreme Court case, Ledbetter v. Goodyear Tire and Rubber Co., led to the next major federal law. Lilly Ledbetter had sued her employer under the Civil Rights Act, alleging that it had underpaid her for 19 years. A jury awarded her more than $3.5 million, but Goodyear appealed, arguing that she had failed to file her suit within 180 days of when the discrimination first occurred, as prescribed by law. An appeals court reversed the original decision, and the Supreme Court also ruled against Ledbetter in a 5–4 vote.

Justice Ruth Bader Ginsburg, in dissenting, suggested that it was now a matter for Congress to take up, which the legislative branch soon did. The Lilly Ledbetter Fair Pay Act, passed in 2009, expanded the period for filing a discrimination claim, making it easier for other women to sue employers that they believed had discriminated against them. It was the first piece of legislation signed into law by then-President Barack Obama just nine days after his inauguration.

The most recent major legislative proposal to address the wage gap is the Paycheck Fairness Act, first introduced in 2009. Among other things, it calls for greater enforcement of antidiscrimination laws and increased penalties for violators. The Paycheck Fairness Act initially passed the U.S. House but failed in the U.S. Senate. In the years since then, it has been reintroduced several times, most recently in 2021, when it again passed the House.

The Gender Wage Gap Today

Despite progress on the legislative front over the past 100 years, the wage gap has been slow to narrow. According to the U.S. Census Bureau, women working full time in 1960 earned about 60 cents for every dollar earned by men—the number cited by President Kennedy in signing the Equal Pay Act.

Though the numbers gradually inched up over the next 30 years, they didn’t reach 70 cents until 1990. In 2021, the latest year for which data is available, women were earning about 84 cents for every dollar earned by men, as shown in the graphs below from the U.S. Census Bureau.

The top graph shows how the female-to-male earnings ratio has increased to almost 84%. The bottom graph illustrates the annual earnings of male and female full-time workers. It shows that women earn about $10,000 less on average than their male counterparts.

On the positive side, women’s full-time earnings have increased at a faster rate since 2000. Full-time female workers earned a median income of $40,156 per year in 2000, while in 2021, they earned $51,226. Meanwhile, full-time male workers earned a median income of $54,471 in 2000, rising to $61,180 in 2021.

In addition to the rise in women’s earnings, considerably more women are working full-time today. The table below shows a 22.22% increase in full-time female workers since 2000, nearly twice the increase for men. There was an enormous layoff of both male and female full-time workers in 2020 due to the Coronavirus pandemic, which eschews the trendline and renders the data difficult to interpret. In fact, it was the single largest drop in full-time employees since the first year of comparable data in 1967.

Moving from part-time to full-time work also means that more women may now be eligible for employee benefits, such as health insurance coverage and retirement plans.

The Gender Wage Gap by Race

The gender wage gap also varies substantially by race. According to 2021 data (the most recent available) from the U.S. Department of Labor, Hispanic women earned just 57 cents for every dollar earned by White non-Hispanic men, while Black women earned 67 cents, White non-Hispanic women earned 80 cents, and Asian women earned 92 cents.

The Gender Wage Gap Debate

Although these numbers are widely quoted, they are not universally accepted. Skeptics argue that the gender wage gap is actually much smaller, saying the numbers are distorted by, among other things, the fact that men tend to work longer hours.

It’s true that more men hold full-time jobs than women (according to the Census Bureau) and perhaps put in longer hours as a result, which may lead to higher incomes. However, the 22% increase in female full-time workers from 2000 to 2021 suggests that more women may be working longer hours as well, a change that appears to have had little effect on their pay.

The Bottom Line

Gender and income inequality may have improved over time, but women are still often underpaid in comparison to men, and there are more levels of inequality within the wage gap when it comes to race and type of occupation. As more and more women continue to work full-time and the size and causes of the gender pay gap continues to be debated, most politicians, pundits, and academics agree that the gap continues to exist. Closing it remains unfinished business in making the United States a more equitable nation.