6 Little Ways The Pay Gap Hurts Women On A Daily Basis

Tuesday, April 4, is Equal Pay Day — the day in 2017 when working women finally catch up to what their male counterparts earned in 2016. Why do women get to work an extra four months to earn the same income? Thank the wage gap. The pay gap hurts women every day, in ways small and large. The chasm between men and women’s lifetime earnings makes a huge difference in women’s lives, affecting their financial stability in the present, and trickling down into their retirement funds in the future.

According to a 2015 Pew Research study, working women currently earn 83 cents to a man’s dollar. That statistic gets worse when you start breaking it down: Pew Research found that in 2015, white women’s median hourly earnings were 81 percent those of white men’s, but that number plummets among women of color. In 2015, black women earned 61 percent of what white men did per hour, and Hispanic women earned only 58 percent.

The roots of the gender wage gap are more complicated than the phrase “Equal work for equal pay” might suggest. Certainly, overt sexism and discrimination exist, and there are still women out there who are paid less than their male colleagues for doing the exact same jobs. But the gender pay gap is also a systemic issue influenced by a variety of factors, including the fact that working women often experience a “motherhood penalty” when they have children (while working fathers often see an increase in pay); women are conditioned not to negotiate salaries and are often penalized when they do; employers exhibit unconscious bias when deciding women’s salaries; and fields that are dominated by women tend to be less lucrative than those dominated by men (especially STEM fields, where women are particularly scarce). There is no easy fix for all of these problems — although instituting paid family leave, more workplace flexibility for working mothers, affordable childcare, and more inclusivity for women in STEM wouldn’t be a bad start.

A lot needs to change in order to achieve equal pay — but fighting for that change is essential for the financial futures of women and their families. Read on to see why:

1. Women take longer than men to pay off their student loans.

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A 2016 study by the American Association of University Women (AAUW) found that, because of the gender pay gap, women are less able to contribute money toward paying off student loans, and therefore repay their student debts more slowly than men. For example, the study found a significant discrepancy in debt repayment among students who graduated from college in 2007 — 2008. Women working full time had paid off 33 percent of their student loan debt by 2012. Men working full time had paid off 44 percent of their student debt in the same time span. Because Hispanic and African American women earn significantly less than white men, the amount they were able to contribute to loan repayment was even smaller; while men had repaid 44 percent of their student loan debt by 2012, African American women had only been able to repay nine percent and Hispanic women, three percent.

The fact that women are thus saddled with student loan debt for longer than men affects women’s financial lives in much broader ways: Because they earn less, they take longer to pay off their debt, which means that they are less able to save money for retirement, emergencies, or major investments like buying a home.

2. The wage gap has a major impact on women’s retirement.  

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In simple terms, what the pay gap means is that women earn less than men over the course of their lifetimes. So it only makes sense that there is also a major gender gap in retirement incomes — which are usually based on career earnings. Because they earn less money in their working years — and often have to take pauses in their careers or decrease hours due to caregiving commitments — women receive less income from social security and pensions than men and are less able to put aside savings. According to a report by the U.S. Congress Joint Economic Committee, the income gap widens to 44 percent in retirement (44 percent!), with retired women receiving only 56 percent of what men of the same age do.

And the results of that discrepancy are stark: Right now, more than 12 percent of women over the age of 65 — and almost 15 percent of women over 75 — live in poverty. By age 75, women are twice as likely to live in poverty as men of the same age.

3. The wage gap impacts mental health.

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A 2016 study by researchers at Columbia University found a link between pay discrepancy and issues with mental health. Researchers analyzed a survey of more than 22,500 American adults and found that women who had lower incomes than men of similar educations, experience, family situations, and age were almost 2.5 times more likely than others to experience depression and four times more likely to suffer from anxiety. “Our results show that some of the gender disparities in depression and anxiety may be due to the effects of structural gender inequality in the workforce and beyond,” Jonathan Platt, PhD candidate and lead author, explained in a press release. “The social processes that sort women into certain jobs, compensate them less than equivalent male counterparts, and create gender disparities in domestic labor that have material and psychosocial consequences.”

4. Wage inequality affects productivity.

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In a 2016 study, economists from Columbia and Berkeley conducted experiments at factories in India to investigate how pay inequality — specifically, how workers’ knowledge of pay gaps between them and their coworkers — affects productivity. And the answer is: A lot. The researchers studied four groups of workers; in one of the groups, workers were paid different amounts, while in the others, workers were paid the same. The workers’ pay was kept secret. After a month, 87.1 percent of workers in the first group — aka the unequal pay group — had figured out the pay scale of at least one of their coworkers (proof that office gossip is a powerful thing). And within about five days of that discovery, the productivity of those workers had begun to drop — even when workers found out that they were getting paid more than their colleagues.

To be clear, this study did not assess how the gender pay gap specifically impacts productivity, but it does raise interesting questions about how pay inequality linked to gender might affect employee performance.

5. The pay gap makes it harder for women to prepare for emergencies.

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The wage gap affects women’s financial stability as a whole; just as they have less extra income to put toward student debt or retirement, women who make less money than their male counterparts are also less able to put money aside for emergencies like sudden medical bills or job loss.

According to a 2015 study by BMO Harris Premier Services based on self-reported savings, men who are able to save for emergencies save about twice as much as women who are able to save. (Lots of men and women, of course, aren’t able to afford emergency funds at all). On average, male survey respondents were able to access $58,061 in an emergency, while women had $33,558 on hand.

6. The pay gap begins in childhood.

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The gender pay gap starts early — very early. A 2017 survey by UK market research agency Childwise found that boys between the ages of five and 16 earn an average of £10.70 per week as allowance or in exchange for chores or paid work. Girl in the same age range, in contrast, get an average of £8.50 — a difference of roughly 20 percent. That discrepancy also grows over time; boys between the ages of 11 and 16 receive 30 percent more money than girls in the same age bracket.

Perhaps even more problematic is the fact that, according to the researchers, gender has a major affect on how parents raise their kids. “The data points towards an early gender imbalance in the way parents educate their children about money matters and financial independence,” Childwise’s research manager, Jenny Ehren, told the Guardian. “Boys are more likely to be entrusted with regular cash payments, while girls are more reliant on other people buying them items, or managing money on their behalf.” It’s not hard to see how these different approaches to money could affect girls as they grow up, and ultimately shape their attitudes toward money as adults.

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The AAUW claims that at its current rate, the gender pay gap will close in 136 years. That is way, way too long to wait for hardworking women to achieve financial parity with male workers. So today, and every day, do what you can to support women in the workforce and advocate for change. Bustle has some ideas for how to do that here.