Added: Shoshannah Khan - Date: 28.10.2021 17:03 - Views: 31301 - Clicks: 3018
Equitable Growth supports research and policy analysis on how strong competition among U. Equitable Growth supports research and policy analysis on how unequal access to care, 21st century work-life policies, and education undermines stable, broad-based economic growth. Equitable Growth supports research and policy analysis on how trends in economic inequality and mobility and changes in the economy have affected the concentration of wealth, income, and earnings, and how these distributional shifts have affected the promise of economic security and opportunity.
Equitable Growth supports research and policy analysis on how tax and macroeconomic policies can promote stable and broad-based economic growth. Bargaining Power. Pay Equity. Wage Stagnation. Today is Latina Equal Pay Day, the day in when Hispanic women in the United States have to work to earn as much as white men in the United States earned in alone. Like Latin or white women women of color, Latinas face multiple structural barriers in the U. Using U. Census Bureau data over an 8-year period, we perform a so-called Blinder-Oaxaca decomposition—an econometric method that determines how much of mean wage differences can be explained by mean differences in human capital and other variables—to estimate the wage gap faced by Hispanic women as a whole, as well as the wage gaps faced by Hispanic women by national origin, immigration history, and education level.
In addition to finding that unexplained wage gap for Hispanic women is greater than the aggregation of the absolute ethnic and gender effects, we also identify particular groups of Hispanic women at an even greater disadvantage. The unexplained portion, usually understood as a proxy for outright discrimination, represents by far the largest portion of the wage gap 22 cents per dollar out of a total gap of 40 cents.
We further break down this white-men-to-Hispanic-women gap into a wage premium for white men 18 percentage points, or 18 cents per dollar and a wage penalty for Hispanic women 22 percentage points, or 22 cents per dollar. The largest explained causes of the white-men-to-Hispanic-women gap include the segregation of Hispanic women into lower-paying occupations 8 cents and lower-paying industries 3 cents and the disparity in access to education and skills training for many Hispanic women 6 cents. When Latinas are held back from Latin or white women market opportunities, their families face worse economic outcomes, and the entire U.
As Hispanic Americans become a larger proportion of the population, their well-being affects the overall distribution of economic outcomes. Ensuring this population has access to good jobs and the social safety net is critical to addressing economic inequality. Hispanic workers are one of the fastest-growing populations in the labor force, yet many are still held back by structural disparities and discrimination that result in low wages and other negative labor market outcomes. The U. The late date for Latina Equal Pay Day demonstrates the differential economic well-being faced by Latinas compared to white men in terms of earnings.
The wage gap between second-generation Hispanic workers and second-generation white workers is narrower than the gap between first-generation Hispanic and white workers. Seminal research by Cornell University economists Francine Blau and Lawrence Kahn finds that occupational segregation is one of the largest factors contributing to the gender wage gap faced by women. Department of Labor finds that Hispanic women are overrepresented in occupations that pay less such as service occupations, compared to non-Hispanic white women.
See Figure 1. Figure 1. Hispanic women in particular had the lowest labor force participation rate of any group of women by race and ethnicity until only very recently—they surpassed Asian women as of and are now approaching parity with white women.
This trend is expected to continue: The U. Among Hispanic Americans, country of origin also has a strong impact on labor force participation. Hispanic Americans have a younger median age than white Americans 13 and have a higher fertility rate.
In addition to their lower labor supply on what economists call the extensive margin lower labor force participationHispanic women also have lower labor supply on the so-called intensive margin fewer hours even when they work full-time. See Table 1.
Table 1. Depressed labor force participation and work hours bring down earnings for individual Hispanic women workers and may also contribute to a more precarious and anti-competitive labor market for all workers. Many of the policy recommendations outlined below to provide childcare and better work-life balance, to enforce workplace protections, and to increase pay equity would likely help boost labor supply as well by attracting inactive workers into the labor market and encouraging both part-time and full-time workers to increase their hours. Analyzing the wage gap faced by black women as a case study, the Equitable Growth working paper by Paul, Zaw, Hamilton, and Darity finds that women of color face wage gaps that are explained by more than the sum of the gender wage gap and the racial wage gap.
A nuanced understanding of the wage gap can help policymakers craft solutions that help Latinas share in the gains of economic growth and enhance the well-being of their families. Using data from the U. We follow a similar strategy as Francine Blau and Lawrence Kahn in their study decomposing the gender wage gap using Panel Study of Income Dynamics data compiled by the University of Michigan, and our model is very similar to the one developed by Paul, Zaw, Hamilton, and Darity in their Equitable Growth working paper on the wage gap for African American women.
As in the case of their decomposition, the wage gap faced by Hispanic women is intersectional—that is, it is the product of group-based discrimination and inequalities that affect women as a whole and Hispanics as a whole, as well as those affecting Hispanic women in particular. Applying the concept to the labor market, Paul, Zaw, Latin or white women, and Darity demonstrate that black women experience a larger wage gap than black men and white women—larger, in fact, than the addition of the race- and gender-based penalties.
See Figure 2.
Figure 2. This Blinder-Oaxaca decomposition uses the observations in the Current Population Survey dataset for Hispanic women and white men to estimate the portion of the wage gap explained by average differences between the two groups in levels of the enumerated variables, as well as the portion unexplained by these differences. As in the case of black women, the unexplained gap constitutes the majority Latin or white women the wage penalty for Hispanic women compared to white men, and this portion is considered the closest approximation of outright discrimination.
Alternatively, among the explained variables, educational inequality and workplace segregation by occupation and industry—which are themselves caused by various forms of discrimination and inequality—are the largest contributors to the gap. The white male premium represents the per-capita wage boost that white men receive over all other workers in the U. Like the aggregate gap calculated above, both of these components in turn have explained and unexplained portions. See Figure 3. Figure 3. In log points, the aggregation of the Hispanic woman penalty and the white man premium is equivalent to the total white-men-to-Hispanic-women gap, and their relative magnitudes can be used to calculate the percentage point contribution of each component to the aggregate gap.
Importantly, both models confirm the empirical evidence presented by Paul, Zaw, Hamilton, and Darity of the role of intersectionality in the labor market. Disaggregating the white male premium and the Hispanic woman penalty for various subgroups of Hispanic women can help paint a fuller picture of wage gaps Latin or white women Hispanic workers based on country of origin, immigration history, and education. This methodological approach demonstrates how white men and Hispanic women of different countries of origin are respectively advantaged and disadvantaged compared to other workers in the economy, while also facilitating a direct wage comparison between the two groups.
There are statistically ificant differences in the wage gap for Hispanic women with different national origins, immigration histories, citizenship statuses, and education levels, but the wage gap is substantial and greater than 20 percent across the entire population of Hispanic women. In terms of national origin, the unexplained and explained portions of the white man wage premium, along with the wage penalty for the largest ethnic subgroups of Hispanic women, are displayed below.
Probably reflecting their pronounced economic challenges, Central American women face the largest wage gaps, followed by Mexican and Dominican women. See Figure 4. Figure 4. In terms of nativity and citizenship status, native-born citizens face the lowest wage gaps, while foreign-born noncitizens face the largest wage gaps.
Importantly, the large penalty for Hispanic women who are foreign born that we calculated does not reflect the greater rates of recent immigration among Hispanic women versus white men in the United States as a whole. Instead, it represents the sharp wage gap imposed on immigrant Hispanic women—compared to white men who are also immigrants. See Figures 5 and 6. Figure 5. Figure 6. In a similar analysis, we calculated the wage gap for Hispanic women with different levels of education.
While the wage gap is large at all levels, it decreases gradually with rising education levels. See Figure 7. Figure 7.
The disaggregation of the white male premium and Hispanic woman penalty detailed in Figure 7 sheds light on the mechanism through which the wage gap changes with rising education. Regardless of their level of education, white men benefit from approximately similar wage premiums—just above 20 percent.
Alternatively, Hispanic women who receive a high school diploma experience a wage gap that is about 10 log points or roughly 10 cents per dollar lower than Hispanic women who dropped out before graduating high school. The intersectional structural barriers faced by Hispanic women that lead to reduced wages affect both their own lifetime earnings, as well as the economic security of their families. As these women are increasingly breadwinners in their families, their opportunities in the U. Because Hispanic women still face limited benefits in terms of the wage gap for getting a college education after graduating from high school, just encouraging higher education will not resolve the gender wage gap.
Instead, addressing outright wage discrimination, occupational segregation, and work-life supports for Hispanic women of all ages is crucial to ensure that Hispanic women and all other women can be fairly remunerated and represented equal to men based on their skills, interests, and ambitions—their human capital.
Unexplained wage discrimination for full-time workers with the exact same job is the largest portion of the overall wage gap experienced by Hispanic women.
Wage discrimination can be addressed through new policies around transparency within organizations in addition to salary history bans in applications, as well as effective enforcement of current anti-discrimination laws. Along with stronger affirmative action regulations, pay transparency likely contributes to an overall lower gender wage gap in the public sector—roughly half the aggregate wage gap, compared to the private sector.
Collective bargaining agreements also mimic pay transparency by clearly defining pay scales for different positions. Similarly, banning salary history helps eliminate outright wage discrimination by preventing workers from carrying around lower wages as they change jobs.Latin or white women
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1. Demographic trends and economic well-being