Graduating to a Pay-Gap

One year after college graduation women working full time earn less–82 percent on average–than male counterparts, the American Association of University Women finds in “Graduating to a Pay Gap,” a study released Oct. 24.  This is slightly higher than it was in 2001 when, among the same group, women earned just 80 percent of what their male peers earned. Women working full time earned $35,296 on average, versus $42,918 for male counterparts. Business was the most popular major for both men (27 percent) and women (19 percent), but female graduates in this sector earned just over $38,000, while men earned just over $45,000.

The study shows that differences in job type and hours explain part of the pay gap, but about one-third of the gap remains unexplained, suggesting that bias and discrimination are still problems in the workplace. 

What Can Employers Do?

In light of the findings, authors recommend that employers: 

  • Increase transparency in pay systems 
  • Ensure clear structures for evaluation
  • Conduct internal pay equity studies and 
  • Take steps to address any gender disparities. 

The analysis is based on data of about 15,000 students who received a bachelor’s degree between July 1, 2007, and June 30, 2008, and were tracked by “Baccalaureate and Beyond a longitudinal study” by the National Center for Education Statistics at the U.S. Department of Education. 

Lower Pay Means Greater Debt Burden

The study also finds women more burdened by student debt. Women and men borrowed roughly similar amounts of money—about $20,000–among 2007-08 college graduates. Women, however, often appear to have a harder time repaying the money for two reasons: lower earnings and a bigger share of the national student loan pie because they are more likely to go to college than men.  Among full-time workers repaying their loans one year after college graduation in 2009, 53 percent of women (39 percent in 2001) versus 39 percent of men (27 percent in 2001) were paying a greater percentage of their earnings toward student loan debt than the American Association of University Women estimates a typical woman or man could reasonably afford to pay. Also, women are more likely than men to borrow money for school (68 percent versus 63 percent).


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