Early data from a forthcoming NACE study indicates that the gender pay gap appears to have widened over the past year.

In recent years, NACE’s First-Destination Survey data has found that the pay gap has stood at around 81% for recent college graduates—that female graduates earned an average of 81 cents for every dollar male graduates earned. However, new data point to a widening of that gap, with female graduates earning just 72 cents to every dollar earned by their male counterparts.

Early data from NACE’s 2023 Student Survey indicate that Class of 2023 male graduates had a median starting salary of $72,500; for women, the median starting salary falls at $52,500. This equates to a gap of 72%—widening more than 10%. (See Figure 1.)

There are likely multiple factors that contribute to the gap, including major. For example, male students have higher representation in business and STEM majors than do women, while women have greater representation in liberal arts and public service majors. (See Figure 2)

However, major doesn’t explain all the differences. As Figure 1 shows, even within majors, men earn more than women. This means that even when women go into gender nontraditional majors, they are still facing a wage gap within that major.

Not surprisingly, gender segregation in college majors impacts the segregation of the labor market. Class of 2023 women have greater representation in education and healthcare and social assistance industries than do men. In contrast, men have higher representation in manufacturing, finance and insurance, architecture engineering, and computer science. The industries that men tend to enter pay higher than the female-dominated industries.

NACE will look at the results from its First-Destination Survey for the Class of 2023 to see if this holds true across a larger data set.

Taking the widening gender pay gap into account and the factors that are perpetuating it, what can be done to shrink and eliminate it?

At the policy level, legislation has been enacted—such as the Paycheck Fairness Act—and equal pay provisions of the Fair Labor Standards Act of 1938 have been strengthened to address pay equity. In addition, most states have their own pay equity laws, including those that ban employers from asking prospective employees their salary history.

However, more needs to be done to close the gap. The U.S. Department of Labor suggests that organizations:

• Increase pay transparency;
• Disrupt occupational segregation;
• Eliminate discrimination;
• Increase access to paid leave and child and elder care; and
• Add good jobs to the labor market and hire women for those jobs.

In addition, NACE recommends that colleges and employers take action to fight the gender wage gap, such as by:

• Challenging gender stereotypes—Colleges can prioritize implementing and enforcing gender equity policies within their career centers to address pay disparities and combat gender-based discrimination. These policies should strongly emphasize promoting fair hiring practices, ensuring equal pay for equal work, and creating opportunities for advancement and promotion. By educating students about these policies, colleges can empower individuals to navigate their careers with the knowledge and confidence needed to challenge and overcome gender-related barriers in the workplace.

• Offering education and awareness—Colleges can help by providing thorough instruction and training. To create a deeper awareness of the underlying causes and effects of the wage gap, they can incorporate gender studies and related courses into their curricula. Colleges can also provide networking opportunities and mentorship programs that link students with successful professionals, particularly those who have overcome obstacles linked to gender inequity in the workplace.

• Facilitating salary negotiation—Employers are essential in enabling individuals to negotiate their salaries successfully. They should provide salary transparency and promote an environment that supports and encourages assertive communication, ensuring those who negotiate for higher pay are not subjected to discrimination or stigma.

• Finding where inequity exists—Employers should conduct equity audits to ensure that workers are paid and promoted equally and have clear, transparent pay schedules so employees know their pay range. They can also aggressively address unconscious biases that may impact salary decisions, support equitable pay practices, and value diversity.

While strides have been made through initiatives like salary transparency and gender pay gap reporting, there is still a pressing need for further progress to narrow the gender wage gap. To bridge the gap, employers and colleges must commit to dismantling the hurdles in the way of gender wage equality. By taking individual and collective actions, we can contribute to a more equitable future in which everyone, regardless of gender, race, or ethnicity, receives fair compensation and equal opportunities.

Mary Gatta, Ph.D., is NACE’s director of research and public policy. Anika Gore is a student in the Kelley School of Business at Indiana University. Gore was an intern in the NACE research department during spring 2023.

Figure 1: Salary by gender in majors

Figure 2: Gender distribution in major