How family leave benefits could solve the gender pay gap

Despite the ongoing effort to promote pay transparency in recent years, the gender pay gap still poses a significant threat to women in the workplace.

In 2024, women as a whole made $71 a week less than their male counterparts, according to a recent research report from job search platform Indeed, which comes out to around 83% of what men make per year. The persistence — and recent growth — of pay discrepancy paints a concerning picture for what the future of compensation holds for women.  

"It's not a bright outlook," says Priya Rathod, a career trend expert at Indeed. "It's actually the worst it has been in a long time. The underrepresentation of women in higher-paying roles, coupled with systemic pay disparities, continues to fuel inequality across various industries." 

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According to Indeed's findings, the main factors driving the wage gap are race, education and age. Across racial groups, Asian men earned 23% more than Asian women, followed by gaps of 16% for Hispanic workers, 15% for white workers and 14% for Black workers. The data also showed that by late 2024, men with advanced degrees were earning 25% more than similarly-educated women. 

Perpetuating the issue, only 60% of job postings currently contain salary information, according to Indeed. Simultaneously, women across all age groups consistently cite the ability to work remotely as a critical factor when considering job opportunities, with 57% between the ages of 35 to 44 having applied for a job specifically because it was fully remote even though the number of jobs offering remote positions is declining. But employers have the ability to make changes that can help balance things out, says Rathod.

"This is where employers come in," she says. "Organizations really have a key responsibility to do their part to help close this gap and make sure there's an equitable workplace where everyone can thrive." 

The benefits of flexible work

Policy changes regarding pay transparency and flexible work arrangements are a critical first step for organizations if they want to offer the kind of support women want, Rathod says. This includes ensuring the disclosure of compensation ranges in job descriptions in order for employees to negotiate their pay equitably and making sure remote options are available and accessible to those in need. Comprehensive family leave benefits should also become standard practice. 

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"Having an environment where people feel empowered to take leave without affecting their career and future earnings is extremely important," Rathod says. "Creating this type of environment allows more women to remain and thrive in the workforce while being treated and paid fairly for the work that they're doing." 

Employers are also facing a number of factors that make the issue significantly pressing. An aging workforce and new restrictive immigration policies could easily lead to a labor shortage, and women will be suited to fill those roles as long as companies are providing them with the proper pathways. 

"It's important for employers to pay attention to this," Rathod says. "People remember what companies do now, and when they're looking for jobs, those are the places they're going to want to work."