A study revealed that women feel less fiscally confident because of the wage gap.
- Fewer women are household breadwinners today (38%) than in 2016 (47%) and 2013 (60%).
- Fewer women have asked for a promotion or raise at work in 2019 (27%) than in 2016 (44%).
- Millennial women, however, are comfortable with current market conditions and ready to invest (49%).
For decades, researchers have found that women receive less compensation than their male counterparts. While data from the Pew Research Center suggests the gap has "narrowed since 1980," women still earned 85% of what their male counterparts made in 2018. A recent survey suggests that as a result of that disparity, American women have started losing confidence in their financial footing.
Despite a recovering American economy, a strong job market and the Equal Pay Act, the 2019 Women, Money and Power Study conducted earlier this year by Allianz Life found that 42% of respondents said they felt they had more earning power than in previous years. That figure, according to researchers, continued a downward trend from 2016 (51%) and 2013 (53%).
"There is a lot of discussion on female empowerment and the accomplishments women are making, including the fact that more women are graduating from college than men and the narrowing of the wage gap over time, just to name a few," said Aimee Lynn Johnson, vice president of financial planning strategies at Allianz Life. "But the disconnect between these accomplishments and the lack of financial confidence suggests perhaps those conversations need to refocus on female financial empowerment."
Conducted online through April 2019, the poll asked 900 American women how they felt about their financial futures. Women between the ages of 25 and 75 years old with a household income of $30,000 per year or more were asked to participate.
Today, businesses are cognizant of the gender wage gap, and many are looking for ways to address the problem. While this issue affects women in the workplace, the survey found that the wage gap impacts other areas of women's lives as well.
Confidence wavers as the wage gap affects women at home
Even though the gender wage gap is a workplace issue, respondents said the wage disparity impacts their self-confidence at home. Without equal footing, women said they feel less financially secure.
According to the survey, just 38% said they were the breadwinner at home in 2019, marking a steady decline from 2016 (47%) and 2013 (60%). Similarly, fewer women said they were their household's CFO, dropping from 53% in 2013 to 47% in 2019. Overall, 62% of respondents said they felt less financially secure this year than they did in 2016 (68%).
When asked, researchers said more than half of respondents (57%) wished "they were more confident in their financial decision-making."
"These findings were quite surprising, because women have come a long way when it comes to our roles in work and family, yet we don't feel prepared financially," said Johnson. "This begs the question, at a time when women are accomplishing so much, why aren't they feeling more empowered about their financial future?"
Despite these issues, women feel more certain about their long-term financial planning ability. Data shows that 90% of respondents said they were taking on more responsibility for handling their households' long-term savings, marking a slight increase from 86% in 2016.
Millennials and divorcees more financially confident than other women
The gender wage gap in America may be an issue for most women, but researchers found that certain groups of female professionals feel better about their financial footing.
According to the survey, millennial women are more proactive about their financial situation than other generations. Having come of age during one of the hardest economic recessions in American history, these women said they were more likely to ask for a promotion or raise, and more than half said they are earning more than ever before.
Millennial women are also less bothered by a volatile market. While other generations are more concerned about current market trends, 49% of millennials said they were ready to invest. That level of assuredness was not reflected in Gen Xers (29%) and baby boomers (37%).
Divorced women are gaining financial confidence, researchers said. Compared to the 50% of divorcees who felt financially secure in 2016, 65% of this year's group felt the same way. Additionally, the longer the women were divorced, the better they felt about their financial situation, understanding financial products and achieving financial goals.
"Women need to be empowered in all aspects of their lives, especially when it comes to finances," said Johnson. "They can start this process by working to educate themselves more on financial topics and products, by not being afraid to broach the oft-thought taboo topic of money, and seeking out a financial professional who understands some of the unique financial challenges that women face today."