Kara Pérez is the founder of Bravely Go, a financial platform focused on feminist economics and inclusive personal finance.
I am sick of Latina Equal Pay Day. What a terrible anniversary to have to acknowledge every year; that still, the wage gap between Latinas and white men marches on. Equal pay day highlights the day that Latinas earn the same amount of money that white men earned in the year before. It takes Latinas an average of 23 months to earn what a white man makes in just 12 months. So while Chad wraps his 2020 earning year on December 31st 2020, Latinas wrap their 2020 earning year TODAY.This year the dollar figure breaks down into every $1 a white man earns, Latinas bring home just $.57.
Why The Wage Gap Persists
Simply put: because of a nasty cocktail of racism, sexism, and stereotypes. Wage gap deniers often say that women choose to work lower paying jobs. These people fail to recognize that studies show employers start paying less when women enter a field. One 2016 study in particular found “when women moved into occupations in large numbers, those jobs began paying less even after controlling for education, work experience, skills, race and geography.” It’s gender bias that creates the wage gap. Sprinkle on some racism, and you’ve got the Latina pay gap.
What Would The World Look Like With Equal Pay?
Equal pay could be something that changes almost everything about our current world. We tend to think of the pay gap in terms of closing it for Latinas and how beneficial that would be for our community and, of course, it would be!
But let’s dare to think bigger. Because closing the pay gap for Latinas would mean the whole world changes. There are around 60 million Latinos in the U.S. If we assume that half are women, that’s 30 million people who could change the entire economy if they were paid equally.
Equal pay would mean:
- Less of a retirement crisis in the US, since Latinas would be able to save and invest more.
- Less inflation and more consumer sales, since 30 million people would have more money to spend.
- More women in the workplace, since women are paid less, they’re more likely to sacrifice jobs to take care of children. Equal pay would mean more working women.
Equal pay is great for the entire economy.
How We Get There
Personal actions, like negotiation and budgeting, are fantastic tools to help change individual lives. But solving the wage gap requires getting both the public and private sectors on board as well; meaning, we need the government to do things like pass the Equal Rights Amendment.
Starting at the very top with government regulation would mean the biggest change in the fastest manner. Implementing new laws that states and companies have to abide by is the single best way to reach across different sectors of work and give a clear outline for everyone to follow. Government regulation would mean a recourse for when companies violate federal laws, and provide a framework for Latinas to work within if they discover they are facing a pay gap.
But it’s not just up to the government to fix this problem. The wage gap has persisted for so long because the narrative is all too often “Women just need to negotiate more and better”, rather than laying the responsibility at the feet of the companies actively paying Latinas less.
— Bravely- Inclusive Money Education (@bravelygo) September 20, 2021
Companies will need to first do pay audits to assess their own pay gaps. From there, companies will have to raise the salaries of women so that they’re equal (not close to equal). If that sounds too far-fetched, know that it’s already been done. In March 2015, Salesforce held a company wide pay audit and found that 6 percent of the company’s employees (both men and women) were underpaid. How did they handle it? They applied raises to every one of those employees, effectively spending $3 million to fix the problem.
We know that companies, especially the most profitable ones like Amazon and Google, CAN fix their internal pay gaps. Salesforce proves that. Companies stepping up is another broad stroke that will change the world. By putting the responsibility on the shoulders of the individual companies, it would change the pay for ALL the underpaid employees within the company.
If we just ask individuals to negotiate more we don’t see as much widespread change. Negotiating for yourself is a wonderful way to change your own financial life, but it doesn’t do anything to ensure that the other Latinas at your company also see pay bumps.
Top down change changes the most lives.
Take Action Today
I’d love it if we never have to acknowledge another Latina Equal Pay Day. What if each October was just about appreciating the beauty of leaves changing color and the beginning of cozy sweater season?
But continuing to change financial narratives for us as Latinas is work I love to do. We can always get better at handling, earning, and passing on our money.
Here’s what you can do to help close the pay gap for all Latinas:
- Advocate for your workplace to do their own pay audit
- Talk to male co workers (especially white men) and ask what their pay is
- Talk to family about money. Many Latinos feel uncomfortable talking about money and we need that to change to change our communities. If we feel empowered at home, it can help us feel empowered in the workplace.
- Get comfortable asking for more during job interviews and for raises during reviews
- Vote for representatives who will pass equal pay legislation
Together, with change coming from the top and the bottom, we can change the future of finance for our community.