Abstract
Gender, racial, and ethnic gaps in wages are well known, but group disparities in employer-provided benefits, which account for one-quarter of total compensation, are not. We use benefit costs data to study levels and trends in gender, racial, and ethnic gaps in voluntary employer-provided benefits. Analyzing Employer Costs for Employee Compensation microdata on wages and benefit costs for the years 1982 to 2015, matched to Current Population Survey files by wage decile in the industrial sector, we find that (1) benefit gaps were wider than wage gaps for minorities but were narrower for gender, (2) racial and ethnic gaps in benefits increased faster than wage gaps, and (3) the gender gap in benefits decreased faster than the wage gap. We show that these findings reflect the types of jobs women, blacks, and Hispanics have held for the past three decades.
Highlights
Gender, racial, and ethnic gaps in wages are well known, but group disparities in employerprovided benefits, which account for one-quarter of total compensation, are not
We have presented evidence that excluding benefits from inequality analyses has led to an overestimate of the size of labor market income inequality between men and women and to an underestimate of the inequality levels between whites and blacks and between whites and Hispanics
Over the years, benefit gaps by race widened faster than wage gaps, whereas the reverse was the case with the gender gap: until 2010, the benefit gap between men and women decreased faster than the wage gap
Summary
Racial, and ethnic gaps in wages are well known, but group disparities in employerprovided benefits, which account for one-quarter of total compensation, are not.
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