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Why women just might save the middle class

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women wage growth pew

Source: Pew Charitable Trusts

American women may still earn less than men, but their role in driving upward mobility among the middle class is increasingly important, new research shows.

Today, full-time working women contribute more than half their total household income on average, providing the kind of financial support that can increase the odds that low- and middle-income households move up the economic ladder, according to a recent report by Pew Charitable Trusts. A generation ago, working women contributed only 25% of their family's household income.

Working women today earn three times as much as their mothers were earning four decades ago, when women worked  24 hours per week for less than $10 an hour. Today, the majority of women work 35 hours per week for $19 an hour on average.

In part because women earn more and work longer hours today, nearly 80% of dual-income households earn more than their parents did today. If women hadn’t increased their participation in the labor force over the past few decades, the rate would be 72%, according to Pew.  

Women's impact is even more noticeable among middle-income families. As the chart below illustrates, middle-income, dual-income households earned 13% more than their parents.

“Women’s increased labor force participation and earnings have enabled some families to maintain their places on the economic ladder or, particularly among families at the bottom, to move up,” the report says.


Pew's most recent study backs up a report it released last May, which found women were the sole or primary breadwinner in 40% of households with children under the age of 18 — the highest record of women breadwinners and a 400% increase from the 1960s.

For kids in two-parent households, having a mom who works can make all the difference in their own economic mobility. Traditionally, children who grow up in poor households have much lower odds of reaching the middle class than their wealthier peers. More than half (55%) will never make it to the middle class, according to Pew.

But those odds would be much worse if their mothers didn't work, Pew says. Without women’s increased labor force participation, 66% of children who grew up poor would never make it to the middle class.

Still a long way to go

Women in the workforce today have come quite a ways from where their mothers stood just 40 years ago, but they still haven’t caught up to their fathers yet. While 85% of women earn more today than their mothers did, less than half of women earn more than their fathers at the same age. By comparison, 70% of men earn more than their fathers.

"Despite the gains women have made, within couples it is still men's wages that are the most important for boosting the family income," Diana Elliot, co-author of the report, told Yahoo Finance. "That was a surprising finding. It does reflect a real wage gap and a real disparity in how women are paid."

While men today earn $5 more on average per hour than their fathers did, women at every income level earn less than their fathers did 30 years ago. The issue is exacerbated by the ever-present wage gap.

Women on average still earn just 77 cents to every dollar a man takes home in the U.S., for a number of reasons, Pew explains. They are more likely than men to leave the workforce or work part-time when they have children. A separate Pew report found that 39% of working mothers say they’ve taken significant time off work to care for a child or family member, compared to just 24% of working fathers. On top of that, women tend to take on lower-wage jobs in industries such as child care and social work.

But, if current trends continue, we might yet see the gender gap close once and for all. Women still make up the majority of college graduates, and Pew notes the wage gap significantly narrows among young women and men today. Among workers ages 25 to 34, women’s hourly earnings were 93% those of men in 2012.

“By all estimates, women’s wages will continue to grow in importance for their families,” the report says. “And this fact makes greater wage parity all the more critical for financial security and mobility.”