Can a Minimum-Wage Increase Help Close the Gender Pay Gap?

The White House releases a report pushing for a minimum-wage increase that promotes fair pay for women. How does the report say this will help close the gender pay gap?

Photo by Shutterstock

By Julissa Catalan

Photo by Shutterstock

Photo by Shutterstock

More than half of workers who will benefit from a minimum-wage increase are women and the move could help close the gender pay gap, a White House report said on Wednesday.

The Impact of Raising the Minimum Wage on Women” was produced in part by the Department of Labor and the president’s Council of Economic Advisers to help study the effects of raising the minimum wage to $10.10 per hour.

“Estimates from the President’s Council of Economic Advisers suggest that increasing the minimum wage to $10.10 an hour and indexing it to inflation could close about 5 percent of the gender wage gap,” the report states. Women currently earn an average of $0.77 for every $1.00 men make in the U.S.

But the report says women account for the majority of workers within the top 10 jobs that pay below the $10.10 threshold—including cashiers, childcare workers and housekeepers. Women also make up 72 percent of employees who work for tips and are more likely than men to earn the minimum possible wage as a restaurant server. Currently, the hourly rate for tipped servers is $2.13—a rate that has not increased in more than 20 years.

The restaurant lobby is trying to push members of Congress to increase the tipped minimum rate. If this bill were to pass, legislation would reset the tipped wage to 70 percent of the normal minimum wage.

 “Raising the full minimum wage and the tipped minimum wage will help reduce poverty among women and their families, as well as make progress toward closing the gender pay gap,” the report says. 

Minimum-wage legislation is in its early stages, but the Democrat-controlled Senate is expected to revise the bill next month.

According to the National Women’s Law Center, there is a correlation between the gender pay gap and states that haven’t raised their minimum wage above the required federal minimum of $7.25 since 2009.

Congressional Democrats and the White House are calling the gender wage gap another gender-equality issue that needs to be addressed—along with affordable childcare, guaranteed paid sick leave and the passing of the Paycheck Fairness Act—as part of their “women’s economic agenda.” 

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