Persistent Wage Gap Preventing Women From Paying Down Student Loan Debt

Posted By Donna Fuscaldo on March 10, 2016 at 9:25 am
Persistent Wage Gap Preventing Women From Paying Down Student Loan Debt

Women still get paid less than men. They are the primary caregivers for many of our nation’s children, and it turns out are also having a tougher time paying off their student loans compared to their male counterparts, reveals a new report from The American Association of University Women.

Using data from the U.S. Department of Education AAUW found the gender wage gap impacts women’s ability to promptly pay off their student loans, which, in turn, is preventing them from saving for retirement, buying a new car or purchasing home. It also makes it harder for women to take career risks like changing industries or starting a business. That, consequently, contributes to the wage gap throughout a woman’s career.

“For college graduates there’s about a 20 percent gap between men and women in wages,” says Kevin Miller, senior researcher at AAUW.  “When you factor in what they majored in and how they did in school that gap is smaller but it’s still about 7 percent.”

According to AAUW, women working full-time one year after graduating college were paid on average 82 percent of what men were paid. What’s more, between 2008 and 2012, men who graduated in the 2007-2008 school year were paid an average of 44 percent of their student loan debt compared to 33 percent for women. Black and Hispanic women, in particular, are having a tough time with their student loan debt. They paid off 10 percent of their debt between 2008 and 2012.

Wage gap causes are complex

The wage gap between men and women isn’t something new, although one might think it shouldn’t exist anymore. But, because women make less than men, it’s harder to pay back their student loan debt. Why women are paid less isn’t that cut and dry. On the one hand, many choose fields that are associated with lower paying jobs such as education, says Lindsey Reichlin, research associate & program manager for the Institute for Women’s Policy Research. There’s also discrimination in the workplace with women getting passed up for jobs and promotions simply because they are female.

Women are also more likely than men to take time off from their career to raise a family, making it harder for them to reenter the workforce a few years later with a commanding salary. Many women seeking a college degree are also parents with many being single mothers, which makes it harder to pay down student loans when they have to provide for themselves and their children. “Women face a gender wage gap that grows over time,” says Reichlin. “They are making 79 cents for every dollar a man earns and that makes it harder because they have less income.”

And while some people may blame women, arguing they are choosing the wrong fields or are relying too much on their partner instead of standing on their own two feet, it’s much more complicated than that, particularly for lower income females. “The reality is low-income women are saddled with those home care and family care responsibilities. Even if they get a job, they are inherently held back if they don’t have a partner that is involved or works,” says Reichlin.

Different ways to break the cycle

So how can women break this cycle? According to Miller of the AAUW, it starts with the degree they choose. For instance, he says science and technology fields often pay higher salaries than other kinds of degrees that women are attracted to. Same goes with where they work. Miller says women should look to work in geographic areas where the wages are higher. He acknowledges a lot of the choice is taken away from women because of their circumstances. Sure, if would be great to move to New York City to get a higher paying job, but if you have kids or family obligations, that may not be possible.

The same goes for a STEM job. If women aren’t exposed to science and technology in high school, it’s going to be harder for them in the introductory classes. Not to mention that women do face harassment when they do get jobs in STEM-related fields.

As for women who are shackled with existing student loan debt, they have other options instead of defaulting on their loan or throwing it into deferment, which only delays the inevitable. One of those alternatives is an income based repayment. A cornerstone of President Obama’s fight to make college more affordable, the White House rolled out the Income Based Repayment program in which student loan payments are capped at 10 percent of the borrower’s income.

There are other loan forgiveness programs available for government workers, teachers and other fields where there is demand for professionals. “It really has roots in a number of different areas of our society,” says Reichlin of the wage gap and the impact it is having on women’s ability to pay back their student loans.

“It’s a manifesto on how we value women’s’ contributions. Even working in early childhood education, your pay is dismal. In elder care, your pay is dismal. We as a society have to rethink how we value these critical roles that women often play.”

Donna Fuscaldo
Donna Fuscaldo is a freelance journalist hailing out of Long Island, New York. She has also written for,,,, Business Insider, Dow Jones Newswires and the Wall Street Journal.

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