Caption : Photo by Katie Harp on Unsplash.     

Warning: the following column contains facts that may induce rage-fueled forehead-smacking and/or keyboard smashing. Happy Women’s History Month!

The gender wage gap and the student debt crisis are inextricably linked: undervaluing women’s work forces women to bear a bigger share of the student debt crisis. Addressing the student loan crisis through debt-free college and broad-based student loan cancellation would help alleviate some of the economic burden that women, particularly women of color, face in our society. 

FACT: Women must work far into the next year to match what men earn the previous year alone. This gap is disproportionately and historically felt by women of color. 

Let’s break it down. In 1996, the National Committee launched the first Equal Pay Day to raise awareness about the gender pay gap. Originally, it only captured the wage gap for women overall, but, over the years, the advocates behind the effort recognized the need to highlight racial disparities. The conversation now increasingly includes the much larger wage gaps for many women of color. Based on the latest available data, the largest gender wage gap is experienced by Latina women. Women, altogether, earn just $0.82 to every one dollar earned by men. 

Now, we have multiple Equal Pay Days each year to recognize the racial disparities within gender pay gaps. First up this year was Asian American and Pacific Islander (AAPI) women’s equal pay day on March 9, since AAPI women are paid $0.85 for every one dollar earned by a white man, on average. However, this number hides the reality that the wage gap is much wider for many women belonging to different AAPI communities. The earnings ratios range from Taiwanese, Indian, and Malaysian women earning $1.21 compared to the white man’s $1.00 to Burmese women earning just $0.52, with dozens of other communities in between.

Black women won’t reach pay parity with the 2020 earnings of white men until August 3, 2021 because Black women earn $0.63 to the white man’s dollar. 

Native women’s Equal Pay Day won’t come until September 8 of this year, due to their earning approximately $0.60 on the white man’s dollar. 

Finally, Latina women typically earn a measly $0.55 on the white man’s dollar, and have to work until October 21, 2021 to reach pay parity with white men’s 2020 earnings. This means that Latinas “must work nearly 23 months to earn what white men earn in 12 months.”

The pandemic has made economic stability even harder for women

This Equal Pay Day, the coronavirus pandemic brings additional challenges to the table. Not only are women—particularly women of color—on the frontlines as the majority of essential workers, but women have continued to bear the brunt of caregiving responsibilities during this extremely trying time. COVID-19 has also led to a massive economic fallout in the last year, with women losing nearly 1 million more jobs than men between February and December 2020. This fallout has disproportionately impacted women of color, particularly Black women and Latinas, who continue to experience some of the highest unemployment rates. 

In December 2020, Black, Asian, and Hispanic women accounted for all of women’s job losses, and 154,000 Black women dropped out of the labor force entirely. Both major job losses combined with the pull of increased caregiving at home has created a recession in which more women have been affected. In addition, members of the LGBTQ community also face significant wage disparities, very likely exacerbated by the current pandemic. Members of the transgender community are four times more likely to have an income of less than $10,000 per year. These outcomes are the result of systemic inequities rooted at the intersection of racism, sexism, heterosexism, and transphobia. 

These disparities didn’t appear out of thin air. The same systems of oppression that brought about gender wage gaps and job loss also manifest the conditions that created the current student debt crisis, which also harms women of color. 

How student debt disproportionately impacts women 

Forty-five million Americans have $1.6 trillion in student debt, two-thirds of it held by women. 

A major racial equity concern regarding the student loan crisis is the disproportionate effect of student loans on Black women. Black borrowers take on more student loan debt, have a harder time repaying their loans, and are four times more likely to end up in default than their white counterparts. Layering on top of that pay disparities for women, including a motherhood penalty, the student debt crisis worsens the economic situation for Black women and Latina borrowers, who face larger wage gaps than white women, making loan repayment even more difficult. In 2017, approximately 34 percent of all women and 57 percent of African American women who were repaying student loans reported that they had been unable to meet essential expenses within the past year. 

In summary, these systemic inequities result in women—particularly women of color—being more likely to be underpaid, under-employed, and carry student debt.

Addressing the student loan crisis through debt-free college and broad-based student debt cancellation would be good for women, helping to:

1. Close the racial wealth gap: When a system exists in which Black students are more likely to need a loan to pay for college, need to borrow more than white students, and will take longer to pay off those loans, cancelling those loans and building a system that does not require debt to begin with is necessary. The former can lift Black and Latina borrowers, who have much less wealth than their white counterparts, out of debt. The latter can importantly prevent future generations from amassing new debt.

2. Close the gender wealth gap: Already, women take out more student debt than men. And it takes them longer to pay off those loans (*cough,* wage gap). Cancel the debt!

3. Facilitate an equitable economic recovery: This doesn’t just mean the stock market’s performance. This means building a system that addresses the needs of working women and people of color—not policies that benefit those who are already well-off. Student debt is preventing generations of borrowers from making the financial decisions they would like to, including starting their own businesses, buying homes, purchasing cars, and more. With women more likely to borrow and borrow more, a debt-free college system would mean women could put their earnings into the economy for future generations to come. And cancelling existing student debt today would stimulate the economy by allowing women to spend their monthly loan payment on things they wouldn’t have otherwise purchased.

4. Improve the lives of young women: One in three young people have student debt, two-thirds of all student debt is held by women, and student debt may shape young women’s decisions to have children, particularly among those with high debt levels. This means that cancelling student debt and making college debt-free is reproductive justice. Free college and debt cancellation must go hand in hand to create options around major life decisions and grant women more freedom to live with dignity and choice. Addressing the student loan crisis could impact women’s ability to choose a job, travel, have independence, decide if or when to start a family, and take care of family without worrying about the financial implications. It could fundamentally change how women shape their lives.

Let’s take the next chapter of our history into our own hands. Take action to cancel student debt to get us all one step closer to gender and racial equity. 

This is one massive step in the right direction, but we also have to abolish the barriers that led to these oppressive and discriminatory systems in the first place. Stay tuned for more action items from Generation Progress on debt-free college.

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