Back in 1974, few Americans would have been surprised to learn that women earned less money than men. Women who did work outside the home often worked part-time or in lower-paying jobs. Few women entered professions such as law, medicine and accounting.
While some may label as myth the assertion that 30 years later, in 2004, women still earn less than men, statistical data confirm the reality that a gap continues to exist between salaries earned by men and women.
In fact, a 2003 survey by the National Association for Female Executives (NAFE) shows that women who work full-time, year-round, earn 76 percent of what men earn. According to NAFE, the gap between men's and women's pay narrowed by only 2 percent between 1991 and 2001.
The reasons for the pay gap are varied. Many women continue to work less than full-time or in lower-paying jobs. A growing number of women -- including highly paid professionals -- take time out of the workforce to care for children or other family members. After a hiatus from the workforce, some women may find that when they do return to work, they end up taking lower-paying jobs than the ones they left.
And although it may be unfashionable to admit it, the "glass ceiling" continues to prevent some women from advancing in the workplace.
More troubling is the notion that men continue to out-earn women in the same jobs. The NAFE survey reveals that even in administrative and support jobs men earn more than women, and in certain professional fields, such as advertising, accounting, law and publishing, a man's annual salary may outpace his female peer's by more than $25,000.
Statistical data for the Memphis area affirms the national findings. The U.S. Census Bureau's Census 2000 Summary File for the Memphis area shows that although more women than men are employed in management and professional occupations (46,473 vs. 36,268), more women had below-poverty-level income (75,086 vs. 54,923). With the numbers of employed and unemployed men and women age 16 and older being roughly equal, the census data suggests that more women work in lower paying jobs than men.
Women also face a lower standard of living during their retirement years. Data compiled in 2003 by the Employee Benefit Research Institute (EBRI) indicate that women may be especially hard hit by the growing shortfall in retirement income. The conclusion is that unmarried women in low-paying jobs are most at risk of having less-than-sufficient retirement income to afford basic expenditures.
America's pension system consists of three prongs: individual savings, employer-provided retirement benefits and the Social Security system. Women may find themselves coming up short on all three categories. First, because women earn less, they have less to set aside during their working years.
Second, both the staff of the Joint Committee on Taxation and the Institute for Women's Policy Research (IWPR) report that fewer women than men are covered by private employers' retirement plans. Women often miss out on coverage because they do not work for employers that offer plans or because they work fewer than the minimum number of hours required for coverage.
The retirement income of women covered by an employer's plan will still fall short of that of their male peers, because earnings- based plans will provide them with fewer income dollars in retirement. IWPR reports that benefits received by women from pension plans equal only about one-half of the benefits received by men.
Women may find themselves disadvantaged when it comes to Social Security benefits, too. The Cato Institute asserts that Social Security's benefit structure, which was devised in an era in which single-income couples were the norm, hasn't kept pace with America's changing workforce demographics. Under the Social Security system, the stay-at-home wife of a covered worker will receive a spousal benefit equal to 50 percent of the worker's retirement benefit.
If, as is more likely today, a husband and wife are both covered workers under the Social Security system, the working wife may end up with the same spousal benefit as the stay-at-home wife if that amount is greater than the benefit she would receive based on her own earnings. She would get nothing in return for the payroll taxes that she paid into the system. A Cato Institute report contends that, due to this inequity, unmarried women and women who are part of two-income couples are subsidizing the benefits of single-income couples.
That women tend to live longer than men completes the recipe for women's economic disaster: With fewer resources, women are more likely to spend our advanced years in poverty. The 2000 Census figures corroborate this conclusion: More than twice as many women as men age 55 and older in the Memphis area had below-poverty-level annual income.
These findings underscore a need for women to save more and save earlier; forgoing the new dress, jewelry or manicure today may mean a more secure future.
Education, too, will be even more important for women striving to narrow the wage gap, since increasing competition for a decreasing number of higher paying jobs will virtually guarantee underemployment for uneducated workers.
And no doubt Congress will be called upon to consider whether the current three-pronged retirement system affords the best opportunity for women to narrow the pension gap.
These findings also make it clear that women can't afford to sit on the political sidelines, especially in light of widely debated proposals for Social Security system reform and Federal Reserve chairman Alan Greenspan's recent call to Congress to lower future Social Security benefits.
Women have far more at stake in the Social Security reform debate: IWPR reports that Social Security benefits constitute 48 percent of the average annual income for women age 65 and older, but only 34 percent of the average annual income for men age 65 and older.
The time has come for us to become well-versed in workplace equity issues, engage in the national dialog, and elect responsive lawmakers. The gender gap won't diminish our ability to hold lawmakers accountable at election time -- unless, of course, we fail to vote.
Source: The Commercial Appeal
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