Pay Equity Q&A

Q: What is pay equity?


A: Pay equity is a means of eliminating sex and race discrimination in the wage-setting system. Many women and people of color are still segregated into a small number of jobs such as clerical, service workers, nurses and teachers. 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. Pay equity means that the criteria employers use to set wages must be sex- and race-neutral.



Q: How large is the wage gap?


A: 2005 Median Annual Earnings of Year-Round, Full-Time Workers

All Men All Women
$41,386 (100%) $31,858 (77%)

Men Women

White $41,982 White $32,173
Black $33,077 Black $29,672
Asian $48,069 Asian $36,092
Hispanic $26,769 Hispanic $24,214
Source: U.S. Census Bureau, Current Population Survey, 2006 Annual Social and Economic Supplement, Series PINC-05


Q: Hasn't the wage gap closed considerably in recent years?



A: The wage gap has narrowed by about 15 percentage points during the last 23 years, ranging from 62 percent in 1982 to 77 percent in 2005. Since 1973, however, approximately 60 percent of the change in the wage gap is due to the fall in men's real earnings and only about 40 percent to the increase in women's wages. At this rate of change, the Institute for Women's Policy Research estimates that it will take until 2057 to close the wage gap.


Q: What is the status of efforts to achieve pay equity?



A: Pay equity is a growing national movement building on the progress made in the 1980s, when twenty states made some adjustments of payrolls to correct for sex or race bias. (Seven of these states successfully completed full implementation of a pay equity plan. Twenty-four states including Washington, DC conducted studies to determine if sex was a wage determinant. Four states examined their compensation systems to correct race bias, as well.)

In the last few years, pay equity bills have been introduced in more than 25 legislatures. On the federal level, the Fair Pay Act has been introduced in the U.S. House of Representatives by Delegate Eleanor Holmes-Norton, and in the U.S. Senate by Senator Tom Harkin. The Fair Pay Act would expand the Equal Pay Act's protections against wage discrimination to workers in equivalent jobs with similar skills and responsibilities, even if the jobs are not identical. In addition, the Paycheck Fairness Act has been introduced in the U.S. Senate by Senator Hillary Clinton and in the U.S. House by Representative Rosa DeLauro. The Paycheck Fairness Act would amend the Equal Pay Act and the Civil Rights Act of 1964 to provide more effective remedies to workers who are not being paid equal wages for doing equal work.