The Gender Wage Gap for Women of Color in Utah

Published Septmeber 2024

Overview

The gender wage gap has significant economic implications. When talented and skilled women are not fully compensated for their contributions, it represents a loss to human capital. Long-term consequences of the wage gap may include diminished lifetime earnings, wealth accumulation, and retirement savings. Understanding these economic ramifications is crucial for policymakers, employers, and other stakeholders in developing strategies to mitigate the wage gap's adverse effects and fostering more equitable economic outcomes.

This research uses 2011 to 2020 data from the Utah System of Higher Education (USHE) and 2001 to 2020 data from the Department of Workforce Services (DWS) to investigate the wage gap faced by women of color (WOC) after leaving postsecondary education. The wage gap grows over time for all WOC, including those who worked and those who were strongly attached to the workforce (SATTW). Strongly attached to the workforce is an approximation of full-time employment based on an individual’s quarterly wages. Wages of WOC are compared to wages of white men with the same attachment to the workforce. Results from statistical tests suggest the wage gap was statistically significant for all WOC in all ten years analyzed for those who worked. The wage gap is further decomposed by students' highest educational attainment, age, and area of study. Using Blinder-Oaxaca decomposition, this research breaks down the wage differences into explained and unexplained portions. The unexplained portion of the wage gap increases over time for almost all groups of WOC. Finally, this study shows that a higher percentage of WOC experienced job loss and income loss during the COVID-19 pandemic than white men, while experiencing lower year-over-year (YOY) wage growth during the pandemic. Job loss is defined as having a zero-wage quarter after March 2020.

Summary of Findings

Finding 1: In general, the gender wage gap grows over time for women of color.


Finding 2: As the educational attainment of women of color increases, the wage gap generally decreases.


Finding 3: In most cases, the portion of the wage gap that cannot be explained by available human capital measures grows over time.


Finding 4: The financial impact of the COVID-19 outbreak has disproportionally affected women of color in terms of wage and job loss.


View Glossary of Terms


Detailed Findings

Finding 1: In general, the gender wage gap grows over time for women of color.

Native American
women who worked
experienced the
highest wage gap
overall.

Asian American
women who were
SATTW experienced
the lowest wage gap
overall.

  • All analyses of the gender wage gap under Finding 1 compare women against White men. Wage gaps are calculated in the years after leaving college, without consideration of whether individuals graduated or not. Data are not shown in graphical figures throughout when groups sizes are insufficiently large.
  • Native American women who worked experienced the highest wage gap overall, from 50.4% one year after leaving postsecondary education to 63.3% ten years later.
  • Asian women who worked experienced the lowest wage gap, from 16.5% one year after leaving postsecondary education to 26.5% ten years later.
  • For WOC who were SATTW, similar trends were observed, where Native American women experienced the widest wage gap (between 30.6% and 54.1%% in the years after college), and Asian American women experienced the narrowest wage gap (between 10.3% and 35.5%).
  • For all groups of WOC, the wage gaps for most years were found to be statistically significant where sample sizes were sufficient, and most of the interaction terms between gender and race were also found to be statistically significant.
Figure 1: The gap between the wages of WOC and white men after leaving postsecondary education

Finding 2: As the educational attainment of women of color increases, the wage gap generally decreases.

Native American women
who earned a certificate
requiring less than one
year and who were SATTW
experienced a wage gap of
43.6% one year after leaving
postsecondary education.

Native American women
who earned a graduate
degree and who were
SATTW experienced a
wage gap of 18.8%
one year after leaving
postsecondary education.

  • All comparisons under Finding 2 are made between women and White men of the same age or educational attainment.
  • WOC who leave postsecondary education at a younger age face a larger wage gap than those who leave postsecondary education at an older age.
  • Healthcare programs are the most popular among WOC, but most WOC who studied healthcare-related programs experienced an increase in the wage gap over time compared to white men who studied healthcare programs.
Figure 2.1: The gap between the wages of WOC and white men, by highest educational attainment and age group
Figure 2.2: The gap between the wages of WOC and white men who studied in healthcare-related educational programs

Finding 3: In most cases, the portion of the wage gap that cannot be explained by available human capital measures grows over time.

About Finding 3:
The basic model structure for the Blinder-Oaxaca decomposition in this section uses individuals' ages, prior work experience, and highest levels of educational attainment as the independent variables to approximate human capital measures. The unexplained portion of the wage gap is consequent to wage differences not accounted for by these independent variables. Please see the glossary for an explanation how the unexplained portion can exceed 100%.

Among all workers,
women of two or more
races experienced the
highest unexplained
portion of the wage gap,
at 90.4% ten years after
leaving postsecondary education.

Asian women
who were strongly
attached to the workforce
were the only group
who experienced a
decline in the unexplained
portion of the
wage gap.

  • Among all workers, Native Hawaiian or other Pacific Islander women experienced the lowest unexplained portion of the wage gap at 58.3% ten years after leaving postsecondary education.
  • Among WOC who were SATTW, Asian women typically had the greatest share of the gender wage gap that remains unexplained by available human capital measures. For example, Asian women have the highest unexplained portion of the wage gap ten years after leaving postsecondary education, at 84.4%.
  • Hispanic women and Pacific Islander women who were SATTW experienced the lowest unexplained portion of the wage gap at 73.1% ten years after leaving postsecondary education and 76.2% nine years after, respectively.
  • Asian women who were SATTW are the only group whose share of the wage gap that remains unexplained by human capital measures actually decreased between one and ten years after leaving college.
Figure 3: The unexplained portion of the gender wage gap after leaving postsecondary education

Finding 4: The financial impact of the COVID-19 outbreak has disproportionally affected women of color in terms of wage and job loss.

Most WOC experienced
lower YOY wage growth
than white men in the
seven quarters following
the COVID-19 outbreak.

All groups of WOC
had a higher
rate of job loss
compared to men
of the same race.

  • Studying the baseline year-over-year (YOY) wage growth at the second quarter of 2019, all WOC had lower YOY wage growth than white men except Pacific Islander women. When comparing YOY wage growth since the second quarter of 2020 (COVID-19 pandemic), all WOC in all quarters experienced lower wage growth than white men, except Asian women in the third and fourth quarters of 2021.
  • While 13% of white men experienced a job loss during the COVID-19 pandemic, 17% of Native American women, 23% of Black women, and 23% of white women experienced a job loss.
  • All WOC groups experienced a higher incidence of income loss than men of the same race, except Native American women, who shared the same incidence of income loss as Native American men.
  • The job loss and income loss suffered by WOC during and after the pandemic may be partly explained by their employment sectors being most impacted by the COVID-19 pandemic, such as healthcare, education, and social assistance.
Figure 4: Workforce impacts of the COVID-19 pandemic

Limitations

  • USHE data come from only public technical colleges and degree-granting institutions in Utah. Data from private postsecondary institutions such as Brigham Young University and Westminster College were not available for this study. In addition, education data are not available for individuals who received awards from a postsecondary institution outside of Utah and received wages in Utah.
  • Data for workforce participation outside of Utah are not available. Some income, such as self-employment, may not be subject to UI wage reporting requirements. Furthermore, UI wage records provide no detail on hours worked. The attachment to workforce status is an approximation.
  • USHE degree-granting institutions’ graduation and enrollment data follow an academic calendar with summer, fall, and spring trimester timelines, while wage data are reported by employers quarterly. The misalignment of these two calendars offers an inherently imperfect calculation of the first quarter when students are available to participate in the workforce.
  • Important variables such as parenthood status, disability status, coming from a low-income family, and parental educational attainment may all contribute to the wage gap WOC faces. However, these variables were not available for the current research.

Conclusion

Using USHE graduation and enrollment data from 2011 to 2020 and DWS wage records from 2011 to 2020, this study analyzed the gender wage gap faced by WOC over time. One year after leaving postsecondary education, Native American women who worked experienced a wage gap of 50.4%. For all groups of WOC, the wage gap grows over time. All wage gaps between WOC who worked and white men who worked are statistically significant.

This study further broke down the wage gap by the highest educational attainment, age group, and area of study. As the educational attainment of WOC increases, the wage gap generally decreases. WOC who leave postsecondary education at a younger age face a larger wage gap than those who leave postsecondary education at an older age. Healthcare programs are the most popular among WOC, but most WOC who studied healthcare-related programs experienced an increase in the wage gap over time.

Using the Blinder-Oaxaca method, this study found the majority of the wage gap cannot be explained by education or prior work experience for all WOC. Asian women experienced the largest portion of the unexplained wage gap, and Pacific Islander women experienced the smallest portion of the unexplained wage gap.

Finally, most WOC experienced lower wage growth than white men during and after the COVID-19 pandemic. All WOC experienced higher rates of income and job loss than white men.

Examining the gender wage gap for women of color acknowledges their unique challenges and recognizes the need to address the compounded effects of gender and racial inequalities. Addressing the gender wage gap and ensuring all individuals are appropriately rewarded for their skills and qualifications may lead to better productivity and economic growth. This study provides empirical evidence to inform and empower policymakers, employers, and other stakeholders to take meaningful action in reducing wage disparities and building a more inclusive and equitable post-pandemic society.

Full Report

Learn more about the gender wage gap for women of color in Utah

This report analyzes students in Utah's public higher education institutions and their wages earned in the years after leaving college. Using Blinder-Oaxaca decomposition, the analysis measures the gender wage gap for women of color in Utah, and identifies what percentage of the gap remains unexplained by control variables.

Report cover

Glossary

Project
Team

Karen Tao
Karen Tao

Senior Researcher
(Analysis/
Report Author)

Zachary Barrus
Zachary Barrus

Assistant Commissioner, UX