Labor Market Discrimination: A Bleak Outlook for Older Women

By Teresa Ghilarducci and Kyle Moore

Older women face worse age discrimination than men in the labor market. Call it intersectionality (the intersection of age and sex discrimination) or call it more of the same—whatever the name, the reality is that older women get paid less for their experience and education than men, and older women have a more difficult time finding work if they are unemployed.

Older men (ages 55 to 64) earn considerably more per hour than older women. Older men working full time average $50,000 a year, compared to $37,000 for women. Hispanic and African American women earn even less ($27,000 and $35,000, respectively). We could call that result triple intersectionality—the intersection of race, sex and age discrimination.

Employers Benefit from Discrimination

What causes pay and promotion gaps not based on differences in quality of work or effort? The main motive for paying and promoting women less is to benefit employers. When employers can pay equally productive people different wages because of another social divide, such as the subordination of women at home, subordinating them at work perpetuates the sexual hierarchy at home and maintains a divided labor force, according to a 1989 article out of the University of Texas-Dallas. Jobs are coded as male and female, and female jobs are less well paid and respected. Thus, men can be threatened when more women enter their occupations. As women increase their share of workers in an occupation, pay falls, according to a 2009 article by Levanon, England and Allison. Women are less likely to be hired into leadership roles, trained or put in positions as peers or supervisors of men.

Most people make rational decisions constrained by the realities they face. If women anticipate that breaking into men’s professions will be met with subtle and overt discouragement, slight banishment and the psychological distress of being an outsider—many women, rationally, will avoid certain life paths. If young women observe that mothers—not fathers—do most unpaid care work for children and older parents, and society provides spotty and expensive care, adult daughters and mothers may sidestep certain career paths. Rational behavior within a culture of gender inequity differs for women who anticipate becoming mothers than for men who anticipate becoming fathers. Fathers are not expected to make those tradeoffs. Men’s judgments and ambitions often create gaps in the gender division of labor at work and home.

If discrimination steers women into jobs with little reward for seniority, women have less incentive to choose jobs with promotion opportunities. Women end up with less seniority, but more frequent job changes, which result in lower lifetime earnings. (If women pay or borrow to go to college they earn a lower return on their investment.) Moreover, employers may then feel justified in believing that women are less dependable, reinforcing continued discrimination.

That subordination breeds behavior consistent with subordination and creates a feedback effect, colloquially known as a self-fulfilling prophecy. Both workers and employers may be behaving rationally and optimally, given their expectations of the other party. When women are pushed into low-paying, low-status jobs, family planning becomes hierarchical. A rational couple prioritizes the higher status career (usually the male in heterosexual couples), assigning domestic duties to the female partner. The added responsibility of unpaid care work limits a woman’s later career prospects.

Low Wages: No Rise on the Horizon?

Studies show that discrimination erodes when political and economic influencers make managers and employers responsible for paying and promoting without regard to race, age or sex, according to a 2006 article in the American Sociological Review. Unfortunately, President Trump’s well-documented beliefs that woman should highly be valued for their appearance, care-giving and loyalty will likely leach into the workplace and normalize behavior that devalues training or promoting older women, making it increasingly difficult for older women to earn a fair and living wage and secure their retirement.

Subordinated treatment in the labor force adds up to a disadvantaged old age—a lifetime of low earnings increases the risk of poverty in old age. Women and non-whites are much more likely to be poor than white men in old age, according to a 2016 article from the Shriver Center. Only 32 percent of older adults are poor or near poor (defined as having an income of less than 200 percent of the Federal poverty line). But 51 percent of black older women, 43 percent of Hispanic older women and 33 percent of white older women live in poverty or near poverty.

The bottom line is that lower lifetime pay means women face a greater risk of living in poverty in retirement than men. Older women live longer without partners and greater levels of disability according to a 2016 article in the American Journal of Public Health. To repeat: a significant portion of women’s higher risk of old age poverty results from age and sex discrimination.

Leadership from President Trump to end discrimination and disdain for older women is necessary, but is unlikely, and probably would not be sufficient, should he choose to act. The status and material well-being gap between older men and women is not likely to close anytime soon.

Teresa Ghilarducci holds the Bernard L. and Irene Schwartz Chair in Economic Policy Analysis and directs the Schwartz Center for Economic Policy Analysis at The New School for Social Research in New York City. Kyle Moore is a doctoral student in the Department of Economics, Retirement Equity Lab, at the Schwartz Center.

Editor’s Note: This article appears in the May/June, 2017, issue of Aging Today, ASA’s bi-monthly newspaper covering issues in aging research, practice and policy nationwide. ASA members receive Aging Today as a member benefit; non-members may purchase subscriptions at our online store.