The Gender Pay Gap: 2023 Data Shows It's Getting Wider

A cartoon of a woman and a man working across from each other in an open workspace illustrates the gender pay gap in 2023

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What’s causing women to earn just 75 cents for every dollar that men make? Why has the gender pay gap suddenly widened for the first time in two decades?

The gender pay gap in 2023 reveals a troubling shift in workplace equality. After 40 years of steady improvement, recent data shows a significant reversal, with women facing growing wage disparities. The economic impact reaches far beyond individual paychecks, affecting everything from childcare access to housing affordability.

Read on to understand the factors behind this wage gap reversal and discover how companies are working to create lasting change.

The Gender Pay Gap (2023 Report)

According to new US Census Bureau data, the gender pay gap in 2023 widened for the first time in 20 years after gradually shrinking for four decades. Women now earn just 75 cents for every dollar that men earn, reflecting persistent inequalities that ripple through the economy.

We’ll explore how much the gender pay gap has widened, who’s most affected, the factors that are driving this reversal in progress, and the solutions that businesses and policymakers are proposing to address the widening gap.

Context

The recent wage gap reversal highlights the stubborn nature of pay inequity. Although the gap has shrunk since 2000, if the rate of progress since then continues, women won’t achieve pay parity with men until 2088, with even longer timelines for women of color.

Across all workers, women earned 75 cents for every dollar paid to men in 2023, amounting to a $14,170 annual difference. For full-time, year-round workers, the ratio was slightly better but still unequal, with women earning 83% of what men earned, down from 84% in the previous year. This widening disparity occurred because men’s wages rose by 3%, while women’s increased by just 1.5%.

The gap varied significantly by race and ethnicity:

White women earned roughly 80 cents per dollar paid to men, unchanged from 2022.
The gap widened for Black women (from 69 to 66 cents) and Asian women (from 98.6 to 94 cents).
Latina workers faced the largest disparity, earning about 58 cents per dollar paid to men, unchanged from the previous year.

Mothers faced a larger wage gap than women overall, earning just 62 cents for every dollar paid to fathers.

The wage gap also fluctuated significantly across the United States: Women in Utah faced the widest disparity, earning only 61 cents for every dollar paid to men, while those in Vermont experienced the smallest gap, earning 83 cents per dollar.

(Shortform note: In her book Invisible Women, feminist campaigner Caroline Criado Perez asserts that almost every country has a gender pay gap: Globally, men earn nearly 38% more than women. Since high earners are more likely to be men, these tax cuts are more likely to benefit men—not women. Perez argues that, by not gender-analyzing their taxation systems, modern governments pass tax policies that disproportionately benefit men and thus discriminate against women.)

Causes of the Widening Gender Pay Gap

The widening pay disparity reflects both longstanding societal patterns and recent economic shifts. While gender segregation in jobs has decreased over time, women remain more concentrated in lower-paying sectors such as health care and education, where wages have grown slowly; in contrast, men dominate higher-paying fields such as manufacturing.

Additionally, traditionally female-dominated jobs often pay less than male-dominated jobs requiring similar skills—for example, housekeepers often earn less than janitors.

Women, who make up the majority of low-wage workers in the US, often face a difficult balance between work and child care responsibilities. This can lead to career interruptions and long-term earnings losses. The cumulative impact is staggering: The wage gap costs women an average of $1.7 trillion annually, affecting their ability to afford essentials such as child care, education, and housing.

The Covid-19 Effect

The World Economic Forum found that the pandemic set women’s equality back by 36 years. Their report didn’t specifically analyze how the pandemic affected the gender pay gap, but the conclusions it did make suggest that the pandemic caused women to earn less money. For example, the report found that pandemic-induced lockdowns were more likely to affect female-dominated industries (such as hospitality).

To address the gendered effects of the pandemic, a United Nations report recommends altering the tax system so it benefits women and thus puts them back on an equal playing field with men. For example, the report suggests that, instead of cutting taxes on high earners, governments create benefits for its lowest earners, who are more likely to be women. It also suggests that governments consider decreasing taxes on industries more likely to employ women.

Consequences of the Widening Gap

These financial constraints impact not only individual women and their families but also have broader economic consequences. Closing the gender wage gap could significantly boost consumer spending and investment in key sectors. If women earned as much as men for the same work, they could, on average, afford:

14 months of child care
Most of a bachelor’s degree
Nearly a year of health insurance premiums
10 months of rent
Almost a year and a half of groceries

This increased spending power would ripple through the economy, benefiting businesses and communities.

Efforts to Close the Gender Pay Gap

In light of persistent wage disparities and their far-reaching economic impacts, some companies have adopted a variety of strategies to combat the gender pay inequities:

Transparent pay structures. A growing number of firms are openly sharing salary ranges for each job, basing them on the role’s responsibilities and market rates rather than individual negotiations. They also conduct regular compensation reviews across similar roles to eliminate gender-based discrepancies and promote fairness.
Performance-based pay. Certain companies have implemented compensation systems based on measurable outcomes and job performance, aiming to eliminate subjective factors that could introduce gender bias in pay.
Résumé enhancement. Forward-thinking recruiters are helping female candidates improve their résumés to counteract women’s tendency to understate their accomplishments, enabling them to secure more equitable starting salaries.
Remote opportunities. Some companies are adopting remote hiring practices to access a wider talent pool and offer flexible work options, which can be particularly beneficial for women with caregiving responsibilities.
Leadership advocacy: Some organizations are focusing on placing women in leadership positions, such as corporate boards, to drive systemic change in pay equity practices from the top down.

The “Leadership Ambition Gap”

In her book Lean In, Facebook COO Sheryl Sandberg explores the professional, personal and societal hurdles holding women back from leadership positions in the workforce. She writes that women tend to leave the workforce when mixing career and family becomes too difficult; as the years go by, there are fewer women in high-ranking leadership positions.

Sandberg contends that part of the problem is the “Leadership Ambition Gap.” Fewer women aspire to senior level jobs. Why? Men are applauded for being ambitious, but hard-charging women violate societal conventions. This bias begins early. Gender stereotypes from birth encourage boys to be leaders, but girls are encouraged to be nurturing. Assertive girls are labeled “bossy.”
Sandberg believes that the Leadership Ambition Gap can be narrowed when women throw aside their fears, aim high, and pursue leadership boldly without regard for gender stereotypes.

The Road Ahead

Experts recommend a multi-faceted approach to address the gender wage gap, including implementing fair pay protections, raising the minimum wage, strengthening worker organizing rights, and ensuring access to comprehensive reproductive health care. Additionally, they emphasize the need for affordable childcare, paid leave, and paid sick time to support workers with caregiving responsibilities—often women—in maintaining steady employment and career growth.

Collectively, these measures, combined with ongoing corporate efforts, could create a more equitable workforce, benefiting not just women but the economy as a whole.

Reflection & Discussion Questions

How might your own workplace’s policies and practices either contribute to or help close the gender pay gap? What specific changes could be implemented?
The data shows mothers earn just 62 cents for every dollar paid to fathers. What societal and workplace factors do you think contribute to this particularly wide gap for parents?
If women earned equal pay, they could afford significant life expenses like childcare and education. How do you think this increased purchasing power would transform communities and the broader economy?
Sheryl Sandberg discusses the “Leadership Ambition Gap” in Lean In. Have you observed different treatment of ambitious men versus ambitious women in your professional experience?
Remote work is suggested as one solution to help close the pay gap. What are the potential benefits and drawbacks of remote work specifically for women’s career advancement?
The article mentions that at the current rate of progress, women won’t achieve pay parity until 2088. What do you think are the biggest obstacles preventing faster change, and how can they be overcome?

The Gender Pay Gap: 2023 Data Shows It’s Getting Wider