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Gender pay gap

Average difference in remuneration amounts between men and women

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Through Remuneration, Employment and European Union

  • non-adjusted pay gap is the average difference in yearly earnings between male and female workers
  • adjusted pay gap is the difference between how much men and women make for the same work, and it takes into account differences in hours worked, occupations chosen, education attained, and job experience.

The global unadjusted gender pay gap is 68.5%. Recently, the pay gap has decreased most rapidly in Global South developing countries. In the European Union, there has been little change in the gender pay gap in the 21st century. In 2024 in the United States, according to Pew Research, women earned 85% as much as men, slightly up from 81% in 2003. Developed Asian economies have also entered a stage of relative stability, yet income disparities remain relatively larger compared with those in Western economies.

The adjusted gender pay gap is much smaller. This means that while women earn less over all, it is primarily due to differences between the jobs and working hours of men and women, rather than differences in pay for the same work. If occupational sorting is an outcome of gender discrimination, this would make it a bad control, making it impossible to draw valid conclusions about the role of gender discrimination on earnings. Although rewarding greater ability and productivity with increased responsibilities and compensation is generally regarded as a reasonable principle, evaluations of equality should also consider gender differences in career opportunities and trajectories. More comprehensive models are needed to assess equality fairly without bias or overcorrection.

Causes for gender pay gaps include having children and parental leave, gender discrimination, and gender norms. In the EU around two-thirds of the gender overall earnings gap is associated with lower women's working hours (gender hours gap) and lower women's employment rate (gender employment gap). The gender pay gap can be a problem from a public policy perspective in developing countries because it reduces economic output and means that women are more likely to be dependent upon welfare payments, especially in old age.

Historical perspective

In the United States, women's pay has increased relative to men's since the 1960s. According to US census data, women's median earnings in 1963 were 56% of men's. In 2016, women's median earnings had increased to 79% of men's. Analysis from the Institute for Women's Policy Research published in 2017 predicted that average pay would reach parity in 2059.

According to a 2021 study on historical gender wage ratios, women in Southern Europe earned approximately half as much as unskilled men between 1300 and 1800. In Northern and Western Europe, the ratio was far higher but it declined over the period 1500–1800.

A 2005 meta-analysis by Doris Weichselbaumer and Rudolf Winter-Ebmer of more than 260 published pay gap studies across over 60 countries found that, from the 1960s to the 1990s, raw (unadjusted) wage differentials worldwide fell substantially from around 65% to 30%. The bulk of this decline was due to better labor market endowments of women (i.e., better education, training, and work attachment).

Another meta-analysis of 41 empirical studies on the wage gap, conducted in 1998, found a similar time trend in estimated pay gaps: a decrease of roughly 1% per year.

A 2011 study by the British CMI concluded that if pay growth for female executives continues at current rates, the earnings gap between female and male executives would not be closed until 2109.

By 2022, cross-country comparisons show wide variation in the gender earnings gap, even after controlling for factors such as age, education, and part-time employment. The gap was lowest in Hungary at 9.9% and highest in South Korea at 40.6%. Analyses limited to wage differences within the same job category reveal a different distribution across countries. In Israel, gender was estimated to account for about 35% of the pay difference observed in identical roles. By contrast, in Hungary, nearly the entire within-job gap (96%) was attributed to gender. Spain recorded a relatively high share at 77%, while Germany (54%) and the United States (48%) were closer to mid-range levels.

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