2023 saw its first increase in gender income inequality since 2003 – here’s what you need to know:
The 2023 Income Report from the U.S. Census Bureau gives us insight into how household incomes have shifted in the past year. According to the data, the median household income rose by 4.0% to reach $80,610 in 2023. While White and non-Hispanic households experienced significant growth—5.4% and 5.7% respectively— other groups, such as Black, Asian, and Hispanic households, didn’t show substantial changes. These numbers underline how economic improvements often don’t reach all demographics equally, which is a crucial consideration for any organization working towards pay equity.
One area of concern highlighted in the report is that the female-to-male earnings ratio declined slightly to 82.7%, reflecting the ongoing challenge of closing the gender pay gap. Despite a 3.0% increase in median earnings for men working full-time, year-round, women’s earnings only increased by 1.5%. This reinforces the importance of establishing pay transparency and structured, data-backed compensation plans within organizations.
For companies striving to address pay gaps, this report is a wake-up call to not only track income metrics but to understand the broader economic trends that shape employee expectations and industry standards. At Pequity, we believe it’s not just about benchmarking against market standards but about using data to build fair and equitable compensation strategies.
Pequity’s compensation management software includes pay parity metrics that let companies monitor and address pay disparities within their teams. These tools automatically flag inconsistencies based on race, gender, or other demographic factors. By taking proactive steps, organizations can avoid falling behind in an increasingly transparency-driven market.
Additionally, our new Approvals product streamlines the oversight of off-cycle promotions, transfers, and new hire offers. These are often the scenarios where compensation gaps quietly widen. By closely monitoring every approval, companies can ensure all decisions align with their pay equity strategy.
Beyond the numbers, this report emphasizes the importance of a data-driven approach to managing compensation. It’s easy for inconsistencies to slip through, especially in large organizations with complex pay structures. Having software that not only benchmarks salaries but also audits and flags discrepancies helps you stay competitive and compliant.
If you’re curious about how Pequity can help you achieve equitable compensation practices, schedule a demo to see our platform in action. We’d love to partner with you on building a fair and forward-thinking compensation strategy.