Closing the Women’s Wealth Gap: How Tax Credits Can Help
March 8, 2018Print
A message from TCWF director Lauren Pescatore:
This International Women’s Day, as we celebrate the accomplishments of women across the world, we must also acknowledge the inequities that plague them. In the United States, despite efforts to end gender pay discrimination, income and wealth disparities continue to be a major barrier to women’s economic empowerment.
For example: in honor of today’s holiday, corporate giant McDonald’s flipped its iconic “M” logo upside-down to form a “W” and “celebrate women who have chosen McDonald’s to be part of their story.” But according to data from the U.S. Department of Labor, women in fast-food occupations are among the lowest paid in the nation. In 2015, women made up 63.4 percent of the “food prep workforce,” and earned an average of $380 per week.
On a national average, American women earn 79 cents on the dollar compared to their male counterparts but own just 32 cents for every dollar owned by men – a disparity known as the “women’s wealth gap.” This disparity worsens for women of color, who own significantly less than both white men and women. The wealth gap results from factors such as women’s predominance in low-wage or part-time jobs that do not offer benefits and is perpetuated by a lack of access to tax subsidies that would help them build wealth. Without adequate wealth, lower-income women are unable to save for unexpected emergencies or invest in a home or business – barriers that are often passed down to future generations.
Robert Reich, former Secretary of Labor, recently teamed up with the Closing the Women’s Wealth Gap Initiative to present policy solutions for building women’s wealth in a short video. Among these recommendations was expanding the Earned Income and Child Tax credits to help women keep more of what they’ve earned and invest in long-term financial stability. According to the video, these credits disproportionately benefit households led by women.
The EITC and CTC not only provide an income boost for working women, they also help to improve health and educational outcomes. The credits are linked to improved maternal and infant health, better school performance and greater college enrollment among children of recipients, and increased retirement benefits for women.
TCWF is committed to building economic opportunity for women by promoting tax credits for low-wage workers at the state and federal levels. If you work on women’s economic empowerment and are not currently a partner of ours, please get in touch. We’d love to talk more about how we can team up.