Greater Boston gender wage gap shrinks, racial wage gap grows — again – The Boston Globe

Report on Wage Gaps in Greater Boston: Progress and Challenges Aligned with Sustainable Development Goals

Introduction

Recent payroll analysis by the Boston Women’s Workforce Council reveals significant progress in closing the gender wage gap in Greater Boston, while the racial wage gap continues to widen. This report highlights critical issues related to wage disparities, emphasizing their implications for achieving the United Nations Sustainable Development Goals (SDGs), particularly SDG 5 (Gender Equality) and SDG 10 (Reduced Inequalities).

Key Findings on Wage Gaps

1. Gender Wage Gap Improvement
   • Women now earn 12 cents less per dollar than men in base compensation, improving from a 21-cent gap in 2023 and a 30-cent gap in 2021.
   • This represents a 43% reduction in the gender wage gap, a significant step toward SDG 5.
   • Factors contributing to this improvement include a 7% increase in women occupying highly paid executive roles and a decline in men’s salaries post-COVID-related pay raises.
2. Racial Wage Gap Expansion
   • People of color earn 31 cents less per dollar than white workers, an increase from 27 cents in 2023 and 24 cents in 2021.
   • This widening gap highlights persistent structural racism and limited opportunities, challenging progress toward SDG 10.
   • People of color are disproportionately represented in low-paying jobs, while white workers dominate higher-paying executive and managerial positions.
   • Executives of color earn on average 41% less than white executives, nearly $96,000 annually lower.
   • Workers of color in operational roles earn 64% of what their white peers make, nearly $23,000 less annually.

Industry and Job Category Analysis

• The nonprofit sector exhibits the lowest gender wage gap at 6 cents but a significant racial wage gap of 28 cents, largely due to demographic disparities in executive versus lower-paid roles.
• Wage gaps persist across 10 job categories and seven industries analyzed, even when women and people of color earn slightly higher wages in some service roles.

Contributing Factors to Wage Disparities

• Impact of Parenthood: The gender wage gap largely emerges after the birth of the first child, as women in dual-career heterosexual couples often reduce work hours or forgo higher-paying jobs, consistent with findings by Nobel Prize-winning economist Claudia Goldin.
• Career Advancement: Fewer companies prioritize women’s career advancement, and women are less likely than men to seek promotions, according to a report by McKinsey & Co. and LeanIn.org.
• Structural Racism and Bias: The racial wage gap is exacerbated by unconscious bias in hiring and promotions, and social factors that advantage white workers in career advancement opportunities.
• Performance Pay Disparities: Bonuses increase wage gaps, with men more likely to receive them and earning more than twice as much as women; similarly, white employees receive more than double the performance pay of workers of color.

Policy and Organizational Responses

• The new Massachusetts pay transparency law mandates salary range disclosures and workforce demographic reporting, aiming to further reduce wage disparities.
• Employers are encouraged to analyze their payroll data to identify and address inequities, aligning with SDG 8 (Decent Work and Economic Growth) and SDG 16 (Peace, Justice, and Strong Institutions).
• Advocacy groups such as YW Boston emphasize that effective diversity, equity, and inclusion (DEI) practices create fairer workplaces rather than advantages for any single group.

Conclusion and Recommendations

The narrowing gender wage gap in Greater Boston demonstrates meaningful progress toward gender equality (SDG 5), yet the expanding racial wage gap underscores ongoing challenges in reducing inequalities (SDG 10). Addressing these disparities requires:

1. Comprehensive employer payroll assessments to identify wage gaps.
2. Implementation of transparent pay practices and equitable promotion policies.
3. Continued support for DEI initiatives to dismantle structural barriers.
4. Policy enforcement and community engagement to sustain momentum toward fair wages for all workers.

These actions are essential to fostering an inclusive workforce that supports sustainable economic growth and social justice in line with the Sustainable Development Goals.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 5: Gender Equality – The article discusses the narrowing gender wage gap in Greater Boston, highlighting progress toward gender equality in pay.
2. SDG 8: Decent Work and Economic Growth – The article addresses wage disparities, fair pay, and employment equity, all central to promoting inclusive and sustainable economic growth and decent work for all.
3. SDG 10: Reduced Inequalities – The expanding racial wage gap and structural racism issues relate directly to reducing inequalities within and among countries.

2. Specific Targets Under Those SDGs Identified

1. SDG 5: Gender Equality
   • Target 5.1: End all forms of discrimination against all women and girls everywhere.
   • Target 5.5: Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic, and public life.
2. SDG 8: Decent Work and Economic Growth
   • Target 8.5: Achieve full and productive employment and decent work for all women and men, including young people and persons with disabilities, and equal pay for work of equal value.
   • Target 8.8: Protect labor rights and promote safe and secure working environments for all workers.
3. SDG 10: Reduced Inequalities
   • Target 10.2: Empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
   • Target 10.3: Ensure equal opportunity and reduce inequalities of outcome, including by eliminating discriminatory laws, policies and practices.

3. Indicators Mentioned or Implied to Measure Progress

1. Gender Wage Gap Indicator
   • Difference in base compensation between women and men (e.g., women making 12 cents less per dollar compared to men).
   • Gender pay gap in specific industries and job categories.
   • Proportion of women in highly paid executive roles (noted as a 7% increase).
   • Gender gap in performance pay/bonuses (men making more than twice as much as women).
2. Racial Wage Gap Indicator
   • Difference in base compensation between people of color and white workers (e.g., people of color earning 31 cents less per dollar).
   • Racial wage gap in nonprofit and other industries.
   • Average base pay differences among executives and workers by race (e.g., executives of color earning 41% less than white executives).
   • Racial gap in performance pay/bonuses (white employees making more than double the performance pay of workers of color).
3. Workforce Demographics and Pay Transparency
   • Reporting of workforce demographics and salary ranges as mandated by new Massachusetts law.
   • Payroll data analysis by employers to assess and address wage disparities.

4. Table of SDGs, Targets, and Indicators

Source: bostonglobe.com