Women’s earnings relative to men’s rose rapidly from 1980 to 1990 (from 60.2% to 71.6%). Since that time, they have continued to rise reaching 77.1% in 2008. This paper assesses whether productivity gains have resulted in increases in earnings greater than the inflation rate and whether the results differ between men and women. For the period 1975 to 2008, the results show that the growth in mean earnings is not significantly different than the growth in the Consumer Price Index for males. The growth in mean earnings for females, however, is significantly higher than the growth in the CPI. The mean growth in the mean earnings of males less the growth in the CPI is .6% and is statistically less than the mean growth in productivity. On the other hand, the mean growth in the earnings of females less the growth in the CPI is 1.92% and is not statistically different than the mean growth of productivity. These results suggest that females have experienced a growth in earnings similar to the growth in productivity during this period.
One explanation for the decline in the gender gap is the observation that in recent years women have been graduating from college in larger numbers than men. To address this trend, the paper examines the growth rate of earnings for men and women as a function of the level of educational attainment. In particular, this study assesses whether gains in output per hour have resulted in increases in earnings greater than the inflation rate for workers with average earnings at each level of educational attainment for men and women. As expected, the results indicate that earnings growth is positively related to educational attainment for both men and women. However, it is found that the mean growth of the Consumer Price Index is not significantly different from the mean growth in earnings for all levels of educational attainment.
Data used in this study is published by the Department of Commerce and is contained in the Census Bureau publication P-60 series, Money Income in the United States and the P-20 series, Educational Attainment in the United States for the sample period 1975-2008.