One of the questions we often get at NWLC is what policy makers can do to close the wage gap. In addition to steps like passing the Paycheck Fairness Act and combating punitive pay secrecy policies, one thing policy makers could do is to raise the minimum wage.
People rarely think about raising the minimum wage as a fair pay issue. But one of the reasons for the wage gap is women’s concentration in low-wage jobs. In fact, women make up about two-thirds of all minimum wage workers. So, raising the minimum wage would particularly boost women’s earnings.
Just a few weeks ago, Senator Harkin introduced the Rebuild America Act (S. 2252) which would gradually raise the minimum wage from $7.25 per to hour (a wage that leaves a mother with two kids working full time, year round, well below poverty) to $9.80 per hour over the next two-and-a-half years. The Economic Policy Institute estimates that this increase would benefit more than 28 million workers, nearly 55 percent of them women.
An analysis of state wage gaps provides additional evidence that a higher minimum wage can help close the wage gap. When you rank all of the states and the District of Columbia in terms of the wage gap, half of the top ten states with the smallest wage gap (giving DC honorary “state” status for this comparison) had minimum wages set at $8.00 per hour or above, including DC, Vermont, California, Nevada, and Massachusetts. And four of these five states, DC, VT, CA and NV, had the four narrowest wage gaps.
In contrast, the bottom one-third of states all have minimum wages below $8.00 per hour. Among these bottom states only three, Alaska, Michigan, and Montana, had minimum wages above the federal rate of $7.25 per hour.
In 2010, the typical woman working full time, year round was paid just 77 cents for every dollar paid to her male counterpart. For this woman, that was a pay gap of $10,784 in just one year. Closing this gap would mean greater economic security for millions of women and their families.