Not yet a Member?
HR Magazine is highlighting the next generation of HR leaders.
Is your employee handbook ready for the New Year? With SHRM’s Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Get the HR education you need without travel expenses or time out of the office.
Join us in Chicago for the latest trends and technology in talent management, and what to expect in the future.
The pay disparity between white and black workers was larger in 2015 than it was in 1979, according to new research. The increasing racial wage gap has been especially detrimental to black employees' economic well-being during the period of weak wage growth over the past decade, in the wake of the Great Recession.
Researchers from the Economic Policy Institute (EPI), a liberal think tank in Washington, D.C., compared black and white workers' average hourly wages, adjusting for education, experience and region of residence. After taking these factors into account, they still found a sizeable wage gap between black and white workers.
Black-White Wage Gaps Expand with Rising Wage Inequality, reports that in 2015:
"While racial wage gaps are worse today than in 1979, the deterioration has not appeared along a straight line," said paper co-author Valerie Wilson, director of EPI's program on race, ethnicity and the economy. "During the late 1990s, the gaps shrank, due partially to tight labor markets which made discrimination more costly, and policy decisions like raising the minimum wage. Since 2000, the gaps have grown again."
Source: Economic Policy Institute.
New entrants into the labor market—who tend to be younger workers—face smaller (though still significant) wage gaps when compared to those who have been working longer, EPI found. However, it seems that these early labor market disadvantages persist and grow as black workers pursue their careers.
Pew: Gaps Significant but Narrowing
Separately, the nonprofit Pew Research Center recently released its own
research on pay disparities, which found that both race- and gender-based wage gaps in the U.S. remain significant, even as they have narrowed in some areas over the years. Among full- and part-time workers in the U.S., for instance, in 2015, black employees earned just 75 percent as much as white employees in median hourly earnings, Pew found.
Source: Pew Research Center.
"Research shows that a majority of each of these gaps can be explained by differences in education, labor force experience, occupation or industry, and other measurable factors," said Eileen Patten, a Pew research analyst who focuses on demographic trends. For instance, she cited an earlier study that showed that controlling for standardized educational test scores reduced the wage gap between black and white men in 2006 by roughly 70 percent. However, the remaining wage gap, which could not be explained by concrete factors, could be attributed—at least in part—to discrimination.
Another recent Pew report found that
roughly two-thirds of black adults say that black people in the U.S. are generally treated less fairly than white people in the workplace, while just 22 percent of white adults and 38 percent of Hispanic adults agree.
Ensuring Fair Pay
Beth Zoller, a legal editor at XpertHR, a provider of employment law resources in New York City, recommends
a multifaceted approach to achieving pay equity by race, ethnicity and gender, which incorporates the following steps:
New EEO-1 Form Requires Reporting Pay Data by Gender and Race
On Sept. 29, the Equal Employment Opportunity Commission (EEOC) issued new requirements on businesses to provide employee pay data by gender and race beginning in March 2018. For the first time, this pay information will be reported on the EEO-1 form that, with some exceptions, private employers with 100 or more employees and federal contractors with 50 or more employees must file each year. The pay-data disclosures are meant to identify possible workplace discrimination that can leave employees of different genders or races with different wages for the same work.
Related SHRM Article:
Employees Rarely Understand Their Employer’s Pay Policy, SHRM Online Compensation, September 2016
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Your session has expired. Please log in again before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
CA Resources at Your Fingertips
SHRM’s HR Vendor Directory contains over 3,200 companies