Higher education is no konger the great equalizer

EQUAL PAY 2020: MYTH OR REALITY?

It has been 57 years since President Kennedy signed the Equal Pay Act into law, and yet, the needle has barely moved on equal pay. In fact, between 2010 and 2018, the aggregate gender pay gap widened. Women currently earn 80 cents for every dollar their male counterparts earn—and that’s the average for all women across the U.S. For women of color, the gender pay gap is generally larger. Latinas, for example, earn 53 cents on the dollar and more than half of Latina mothers are the breadwinners of their families. That 53 cents on the dollar adds up to $1.1 million in lost wages over the course of a Latina’s full-time, 40-year career.

But the issue of pay inequity doesn’t “stop” at the household level. It affects everyone. Closing the gender pay gap alone would increase GDP by $512 billion. How? Let’s examine three issues—higher education, criminal justice, and international trade—to get a glimpse of how and why the gender pay gap cuts straight through the economics of America.

HIGHER EDUCATION IS NO LONGER THE GREAT EQUALIZER

When we tell our youth that higher education is the path to economic mobility, we are only telling them half of the story. We cannot forget about student loan debt and the female graduates who disproportionately shoulder its burden. Women represent 57% of undergraduates yet hold 67% of all student loan debt. In 2000, they made up 45.1% of the college-educated workforce. Today, they are 50.2%—meaning they are the most educated cohort in the workforce.

And yes, educational attainment correlates positively with income. However, educational attainment also correlates positively with the gender pay gap. Not only do women carry more student loan debt, but their return on education also diminishes in proportion to men’s with every degree they earn. Women with bachelor’s degrees earn 71.4% of what men with bachelor’s degrees earn. Women with graduate degrees earn 69.1% of what men with graduate .The wage gap makes it harder for womento pay back their loans, and defaulting on loans is expected to cost taxpayers $31.5 billion in the next 10 years. Any reform to higher education must account for these inequities. Punishing half of the labor force, our future talent, for receiving an education is not in our economic best interest, especially on the heels of a labor force shortage of five million skilled workers.

CRIMINAL JUSTICE AND THE GENDER BAIL GAP

Incarceration rates overall have been fallingsince 2008. When gender-disaggregating the numbers though, we find that the drop only applies to men. For women, the rates are going up. In 1983, women represented 9% of jail admissions. By 2016, their share jumped to 23%. It might appear, then, that women’s behaviors are becoming more of a threat to civil society—until we factor in how the gender pay gap influences bail.

The population of female prisoners in state prisons has grown by more than 800% in the past 40 years. Many of these women are incarcerated due to non-violent offenses and haven’t been convicted of a crime. Rather, they simply cannot post bail as they await their trials. Women who cannot make bail earn a median income that is nearly 30% lower than the median income of men who cannot make bail. As a result, the gender pay gap has effectively created the gender bail gap.

Beyond issues of fairness, the gender bail gap is a threat to our future generation, democracy, and economy. Of the 102,000 jailed women, 80% are mothers. Children with incarcerated mothers experience increased risk of violence, health problems, and school dropout. Jail time also weakens our democracy, as the probability that someone will exercise their right to vote decreases after spending time in jail. And from a fiscal policy perspective, we allocate between  $63 billion and $75 billion every year to maintain our prison system.

These are our tax dollars at work. Let’s invest them into resources that provide people with a path to economic self-sufficiency and prosperity.