Recent data reveals a troubling reversal in wage equity, with the gender pay gap widening for the second consecutive year—the first such occurrence on record. According to the latest Census Bureau figures, women in full-time roles earned an average of 81 cents for every dollar earned by men in 2024, down from 83 cents in 2023 and 84 cents in 2022. The disparity is even more pronounced for Black women, who received just 65 cents per dollar in 2024, a decline from 66 cents the prior year and 69 cents in 2022.
The labor force has also seen a significant shift: 338,000 women exited employment since January 2025, while men gained 183,000 positions. The participation rate among mothers has dropped nearly three percentage points, reaching its lowest level in three years. Meanwhile, unemployment among Black women rose to 6.7% in 2025, up from 5.4% at the start of the year, compared to an overall national rate of about 4%.
Jasmine Tucker, vice president for research at the National Women’s Law Center, attributes the trend to stagnant wage growth for women—just 0.3% over two years—while men’s earnings increased by 3.7%. “We’re seeing men pull further ahead while women’s compensation remains flat,” she explained. “This divergence is directly fueling the growing gap.”
These developments may foreshadow broader economic instability. Historical patterns show that women, particularly Black women, are disproportionately affected during downturns. After the Great Recession, Black women faced double-digit unemployment for five years, a burden not shared by white men. Tucker warns that current indicators—rising joblessness and workforce attrition among women—could signal an impending recession.
The economic consequences extend beyond individual households. Over a 40-year career, the wage gap costs the average full-time woman $462,000 in lost income, with women of color potentially losing over $1 million. These losses affect retirement security, family stability, and consumer spending. Nearly 40% of women are primary earners in their households, amplifying the ripple effects.
On a macroeconomic level, reduced female labor force participation and unequal pay hinder GDP growth. Women constitute roughly half the population, and their full economic engagement boosts tax revenue, consumer demand, and overall productivity. The World Bank estimates that closing the gender gap could increase GDP by 20%.
Multiple factors are driving the trend. Return-to-office mandates disproportionately affect caregivers, most of whom are women. The rollback of pandemic-era benefits—such as flexible schedules and enhanced childcare support—has made balancing work and family more difficult. Additionally, the national average cost of childcare for one child—$13,128 annually—exceeds typical rent for two children, creating financial strain. A shortage of childcare workers, exacerbated by immigration enforcement, further limits access.
Cuts to federal jobs, particularly in agencies with high female representation—like USAID (59% women), Social Security Administration (66%), and EPA (54%)—are also contributing. Tucker notes that these reductions threaten to make the federal workforce less diverse and less reflective of the general population.
Cultural shifts toward traditional gender roles may also influence women’s workforce decisions. However, solutions exist: salary transparency laws, pay equity audits, eliminating salary history inquiries, and raising the minimum wage can help close disparities. Flexible work arrangements, paid leave, subsidized childcare, and equitable advancement pathways are also critical.
Leslie Forde, founder of Moms Hierarchy of Needs, stresses self-care as part of systemic change. “Supporting yourself isn’t selfish—it’s essential to sustaining your family and career. Leverage communities, share responsibilities, and reduce isolation,” she advised.
“This requires a multi-faceted approach,” Tucker concluded. “Employers must value diversity, states should strengthen equal pay laws, and we need to remove barriers—not create them.”
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The Economic Impact Of The Wage Gap Growing Two Years In A Row
A troubling trend may foreshadow an approaching economic downturn: Fewer women are now in the workforce as compared to January 2025, and, for those that remain, the wage gap has widened for two years in a row for the first time ever, according to the latest Census Bureau data. n nThe data is showing a greater number of women are either departing or being pushed out of the workforce. Since January 2025, there have been 338,000 women who have left their jobs, compared to the 183,000 jobs men have gained in the labor force. The share of mothers in the labor force has dropped nearly three percentage points to its lowest point in three years. Unemployment for Black women has increased in 2025, rising to 6.7% as compared to 5.4% in January 2025 (the overall unemployment rate for workers on average being about 4%). n nAt the same time, we’re going backwards on the gender and racial wage gap. Women working full time, year-round were paid on average just 81 cents for every dollar paid to men in 2024, which is down from 83 cents in 2023, and 84 cents in 2022. The wage gap has grown even more for Black women who were paid just 65 cents in 2024, compared to 66 cents in 2023 and 69 cents in 2022. n n“We saw a widening of the wage gap that was particularly bad for Black women in 2023, and we saw that penny slide back for women overall,” says Jasmine Tucker, vice president for research at the National Women’s Law Center. “Then in 2024, we saw a similar trend where men’s wages grew by 3.7% and women’s wages were essentially flat. We’re seeing this outpacing of wage growth for men and almost no wage growth for women over the last two years, and that’s what’s contributing to the increasing wage gap.” n nThese statistics may serve as a canary in the coal mine for what’s to come for the economy. “If we look at evidence from the most recent recessions, such as the Great Recession and the Covid-19 downturn, women, and in particular Black women, were hit the hardest and the longest. After the Great Recession, Black women had double-digit unemployment rates for five years, and white men never experienced similarly high rates. I think we’re going to look back at today’s statistics of women leaving the workforce and the increased unemployment rates for Black women, and say we should have known that we were heading toward an economic downturn.” n nMORE FOR YOU n nTucker predicted that we would see a regression in the wage gap, as she told me in a previous story on Equal Pay Day 2022, “All those low-paid women workers who were forced out of the workforce during the past two years of the pandemic are going to come back to work. When they return, they might take a lower-paying job or have an employer who pays them less because they’re not fresh on their skills or whatever it is. I have a feeling that we’re going to see that wage gap widen in the future.” n nWhat The Wage Gap Means For The Economy n nWhen women aren’t fairly compensated for their labor or are pushed out of the workforce in large numbers, it costs women, families, and the economy. n nThe 81 cents to the dollar wage gap for women adds up over the course of lifetime. Full-time working women on average could lose $462,000 over the course of a 40-year career, and the losses for women of color could add up to over $1 million. Apart from the wage gap robbing women of lifetime earnings that impacts their Social Security payments and retirement, not paying women fairly also impacts their children and families, as nearly 40% of women are their family’s primary breadwinner. n nThere’s also a larger economic impact for having less women in the labor force and a widening wage gap. That’s because women make up roughly half the population, and having more people in the workforce and paying fair, equal wages helps boost the Gross Domestic Product (GDP) because it translates to more people earning money that they can then spend on goods and services, helping fuel local economies. In addition, more people in the workforce means a greater percentage of the population paying taxes to help increase the government’s revenue to fund public goods and services, which in turn spurs more economic growth. n nWe can’t afford to go backwards on gender equality: Closing the gender gap could lift the GDP by 20%, according to the World Bank. n nWhat’s Behind the Shrinking Female Workforce And Widening Wage Gap n nThere are, of course, a myriad of factors contributing to the retreat of women from the workforce, as there is for an increase in the wage gap. n nIn terms of having less women in the labor force in 2025, a decrease in workplace flexibility with return to office mandates disproportionately impacts caregivers, the majority of which are women. For many women, being in the office five days can make it much more challenging to balance it all, as caregiving duties continue to fall largely on women’s shoulders and school schedules don’t fit with the average nine to five workday. n nThere’s also a rolling back of employee perks many experienced during the pandemic. “During the height of the pandemic and lockdown, many employers were just rolling out the red carpet with better benefits, better flexibility, and better compensation to keep people from leaving and to attract new people, says Leslie Forde, founder of Moms Hierarchy of Needs and author of Repair With Self Care. “However, as the economy has started to tank again, many are rolling back those important employee perks. This is yet another signal to a lot of women, and particularly caregiving women, mothers, and those who might even be caring for adults, that they will need to pause if they can financially afford it to be able to balance all their responsibilities.” n nThen there is the big issue of a lack of affordable childcare and a shortage of childcare workers. The average national price of childcare for just one child is $13,128 a year, meaning the price to send two children to daycare is higher than the average cost of rent. Immigrants make up 20% of childcare workers, so mass deportations are likely impacting this sector. New Mexico is addressing the childcare crisis by becoming the first state to offer universal childcare regardless of income, set to start in November. “It’s not an expenditure, it’s an investment,” Lt. Gov. Howie Morales (D) told reporters as reported in the Washington Post. “It’s an investment in our families, it’s an investment in our children, it’s an investment in our economy.” n nTucker points to a broader rollback of diversity, equity, and inclusion (DEI) initiatives and cuts to federal jobs as a significant driver of the widening gap and fewer women in the workforce. Many federal positions, known for better pay equity and benefits, are being cut—jobs where women and Black women are highly represented. n nWomen represent about half of federal workers, but are more highly represented in federal agencies targeted for job cuts, such as the U.S. Agency for International Development (59% women), Social Security Administration (66%) and Environmental Protection Agency (54%). “We’re going to see a much more white, much more male federal workforce,” says Tucker. “It’s not going to look like the population, which was, I think, the goal.” n nLastly, cultural trends may have an influence on women leaving the workforce, such as the push for conservative values and traditional gender roles as one strategy to attempt to counteract the declining birth rate. n nHow To Get Closer To Gender Equity n nHaving more women in the workforce and paying them fairly is beneficial for the economy, yet there are various external pressures impacting women’s ability to stay in the workforce and care for themselves and their families. Flexible schedules, paid leave, and subsidized childcare are good starts. Forde also wants to help women address the internal factors and care for themselves while we’re waiting on outer change. n n“Think of caring for yourself not as something you’re doing instead of caring for your family, but as something you are doing in service to your family and your workplace, because if we go down in flames, nobody wins,” Forde says. “We’re socialized to give, to be pleasing, to be perfectionistic, and it feels uncomfortable asking for support as we can be judged for it. However, it’s an essential part of making life work better, and frankly, it’s more fulfilling and enjoyable to leverage the different communities that you’re part of, and ease the isolation associated with doing something as big as raising kids while caring for yourself, your family, and your career in parallel.” n nSome ways Forde suggests doing this is to join an ERG for parents in your workplace, carpool with other parents for school pickup or drop off so you get some time for yourself, renegotiating caregiving duties with your partner if you’re partnered up, or doing a childcare swap with a neighbor. n nWhen it comes to closing the wage gap, there are a number of ways to help close the gap. Salary transparency laws, not basing compensation on salary history, and pay equity audits are all a step in the right direction, as is creating equitable pathways for advancement to leadership positions within organizations, which typically pay more. Also, raising the minimum wage helps close the gap because women, and Black women in particular, are overrepresented in the lowest-paid jobs. n n“The key is a multi-pronged strategy,” says Tucker. “Employers need to see DEI as a benefit. States can strengthen paycheck fairness and equal pay laws. We need to create pathways for women—not more roadblocks.”