A recent report details how gender and racial wage gaps fuel corporate profits and leave African American women involuntarily forfeiting billions of dollars in wages.
Dr. Michelle Holder, assistant professor of economics at John Jay College of Criminal Justice, City University of New York, has laid out the numbers in the report “The ‘Double Gap’ and the Bottom Line: African American Women’s Wage Gap and Corporate Profits,” produced in partnership with the Roosevelt Institute.
She found that because of the double gap — caused by gender and racial discrimination — African American women involuntarily forfeited as much as $50 billion in wages in 2017. This meant significant, recurring cost-savings for the private for-profit sector and a recurring annual loss for the Black community. The main data set Holder used to arrive at this figure was the 2017 American Community Survey.
“It occurred to me that none of my peers and colleagues had looked at the aggregate impact of this double gap for Black women,” said Holder, a labor economist. “Typically, when we talk about wage gaps, particularly among Black women, it’s treated as an individual, anecdotal problem. This is not an individual problem. This is a collective problem.”
Besides, Black women in the workforce don’t necessarily know they’re being underpaid.
“In order to know that, they’ve really got to know what all of their colleagues are making,” said Holder. “It’s an issue that’s invisible to Black women, but it’s not invisible to employers.”
She said because employers know how wages are distributed in their organizations, they need to acknowledge and deal with the disparity. Employers can discern whether there is a problem with underpaying women in general, and African American women in particular, by what Holder calls a “pay parity audit.”
