WASHINGTON, DC— An Equal Pay Day report released today by the Joint Economic Committee shows that the pay gap between men and women, where women earn 77 cents for every dollar earned by their male counterparts, affects women’s retirement incomes and results in reduced economic security for women during their retirement years.
The report titled, “The Gender Wage Gap Jeopardizes Women’s Retirement Security,” finds that the median income for women 65 and older is over $10,000 less than the median income for men 65 and older -- $15,209 compared to $25,409. The report can be viewed here.
Senator Bob Casey, Chairman of the JEC, stated, “Progress in closing the pay gap has been too slow. As this new JEC report shows, the pay gap has lasting and powerful effects on women’s income long after they have stopped working. As a result, women face retirement with lower incomes and less economic security.”
Retirement income comes from multiple sources, including Social Security and pensions, where the benefits are linked directly to an individual’s earnings, and savings plans where there is no direct link to earnings but the amount an individual can contribute is affected by how much he or she earns. The persistent pay gap affects women’s retirement income from both types of income sources.
The JEC report finds:
• Older women’s Social Security benefits are 71 percent of older men’s; women’s income from public pensions is 60 percent of men’s; and when it comes to private pensions, women’s income drops to 48 percent of men’s.
• Women are also less able to contribute to other retirement-saving plans, such as individual retirement accounts (IRAs), as a result of their lower earnings. Women 65 and older who receive income from these types of saving plans receive half as much income as men do.
• With less retirement income to draw from, many women remain in the labor force after reaching 65. Yet, median income from earnings for women 65 and older is only 60 percent of men’s earnings.
Casey continued, “Older women workers face a larger pay gap than younger women. In Pennsylvania, women 50 and over earn just three-fourths of what their male counterparts make. Addressing the pay gap is vital to current workers and their families, who increasingly depend on women’s incomes to make ends meet. And progress on the pay gap will strengthen women’s retirement security.”
Senator Casey is an original cosponsor of the Paycheck Fairness Act, which was reintroduced today in the Senate. The Paycheck Fairness Act strengthens the original Equal Pay Act, which was signed into law by President Kennedy in 1963 and prohibits employers from discriminating on the basis of gender. In 1963, women earned 59 cents for every dollar earned by men. Nearly 50 years later, there remains a 23 cent gap between men’s and women’s earnings.
The Paycheck Fairness Act:
• Prohibits employers from punishing employees for sharing salary information with co-workers.
• Makes discrimination costly to employers by making those who bring gender discrimination cases eligible for compensatory and punitive damages as is the case with race and ethnicity discrimination cases.
• Develops new training programs for women and girls on how to negotiate compensation packages and recognizes employers who have eliminated pay disparities.
The Joint Economic Committee, established under the Employment Act of 1946, was created by Congress to review economic conditions and to analyze the effectiveness of economic policy.
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