Since 2016, the U.S. has seen a surge in stronger pay equity laws, starting with Massachusetts, California, and New York. This period also marked the introduction of salary history bans and pay scale transparency laws, with states like Massachusetts and California as first adopters. These types of legislation require employers to avoid asking job applicants for their prior salaries and to disclose salary ranges in job postings.
But do these laws actually lead to improvements in pay gaps?
Syndio analyzed census data from 2011-2022 (ACS table B24012) on median pay by occupation in six key states which have passed pay equity legislation: Colorado, California, Illinois, Massachusetts, New York, and Washington.
We included the 25 most detailed occupations the census bureau reports at the state level. Nationally, men earned more than women in each of these occupations in 2022. Community and Social Service Occupations had the smallest pay gap (4.2%) and Sales Occupations had the largest pay gap, with men earning 47% more than women. Over the past decade, these occupational pay gaps have narrowed from 26% on average to 24%.
Below, we explore how much gender pay gaps closed within occupations at the state level for states with robust pay equity or transparency legislation compared to the national average.
Are pay transparency laws impacting the gender pay gap?
Occupational pay gaps are closing more rapidly in most states with pay transparency legislation. Based on our analysis, occupational gender pay gaps closed more quickly than the national average in 4 out of the 6 states where pay transparency legislation is now in effect:
- Illinois: 1.2x as fast as national average
- Colorado: 1.3x as fast as national average
- Washington: 2.1x as fast as national average
- Massachusetts: 2.4x as fast as national average
California and New York’s occupational pay gaps closed at a slower pace than the national average, but those states already had some of the smallest pay gaps in the nation to begin with.
The table below summarizes the findings from our analysis. You can get more details about the states with pay transparency legislation in Syndio’s U.S. Pay Transparency Legislation Cheat Sheet.
| National | 24.0% | 26.1% | 0.18% per year | - | - | - | - |
| California | 20.0% | 21.1% | 0.05% per year | 72% slower than national average | Jan. 2016 | Jan. 2018 | Jan. 2018 (pay scale available “upon request”); May 2021 (pay reporting required); Jan. 2023 (pay scale required on job posting) |
| Colorado | 23.1% | 25.2% | 0.24% per year | 1.3x faster than national average | Jan. 2021 | Jan. 2021 | Jan. 2021 (pay scale required on posting - first law of its kind) |
| Illinois | 23.0% | 25.4% | 0.22% per years | 1.2x faster than national average | Sept. 2019 | Sept. 2019 | 2023 (pay reporting required); Jan. 2025 (pay scale on job posting) |
| Massachusetts | 22.9% | 0.43% per year | 2.4x faster than national average | July 2018 | 22.9% | July 2018 | Proposed law in legislature |
| New York | 21.5% | 22.6% | 0.10% per year | 46% slower than national average | Jan. 2016 | Jan. 2020 (NYC had ban effective Oct. 2017) | Nov. 2022 (NYC pay scale in job posting); Sept. 2023 (NY pay scale in job posting) |
| Washington | 22.1% | 25.9% | 0.39% per year | 2.1x faster than national average | June 2018 | Jan. 2019 | July 2019 (pay scale available “upon request”); Jan. 2023 (pay scale required on job posting) |
1Results are qualitatively similar when we restrict to full-time, full-year earners, though pay gaps tend to be 5.4 percentage points smaller in magnitude.
Pay transparency laws: not a “silver bullet” for workplace equity
While this data shows encouraging progress, it highlights that this type of legislation is not a panacea for creating sustainable workplace equity and closing pay gaps.
The new laws requiring public disclosure of pay scales may help drive change as pressure builds for companies to keep up with transparency norms if they want to compete for talent. A study from Indeed found that the share of postings with pay transparency information nearly tripled from 18% in February 2020 to over 50% in August 2023.
However, while pay transparency laws are correlated with reduced pay gaps within occupations, they don’t address a major driver of the pay gap: relatively low representation of women in higher paying roles. These laws generally address equal pay for equal work, but they are not targeted at reducing occupational segregation or pay differences between jobs.
Syndio’s latest U.S. opportunity gap report finds there is still a significant difference in the rates at which historically underrepresented communities move into higher-paying management and leadership roles. According to our analysis, white men are 1.9 times as likely as white women to be in leadership jobs, 3.6 times as likely as men of color, and 5.6 times as likely as women of color.
There is an emerging trend of legislation — like the new EU Directive on Equal Pay and Transparency — requiring companies to disclose their median pay gaps. The median pay gap isn’t as simple to solve as pay equity, which can be directly remediated by adjusting the pay of underpaid employees. Closing median pay gaps requires sustained efforts over time across the organization to ensure that employees are promoted and advanced equitably.
Pay gaps can’t wait
Companies should start addressing their pay gaps now, before new requirements such as the EU Directive go into effect. It takes time to move the needle on pay gaps — and brands will benefit from proactively starting to build a story of progress ahead of their first public disclosure.
Want to understand your organization’s current pay gaps? Use our pay gap calculator below. Once you know where you stand, you can develop an action plan to analyze, address, and communicate about your pay gaps — and Syndio’s team of experts can help.
MethodologySyndio analyzed census data (ACS series B24012) on median pay by occupation in six key states who had passed pay equity legislation: Colorado, California, Illinois, Massachusetts, New York, and Washington. The question was how much gender pay gaps were closing within occupations in these states compared to the national average. Syndio’s analysis focuses on states that have had pay transparency laws in effect for multiple years during the time period with the assumption that these would be the most likely to show measurable movement. For this reason, the analysis excluded states whose laws passed relatively recently. Only the most detailed occupation codes were included, removing aggregate codes like “Healthcare practitioners and technical occupations” while retaining the more detailed subcategories, like “healthcare technologists and technicians” and “healthcare support occupations”. Observations with high margins of error for either sex were removed from the analysis, excluding 2% of year-occupation combinations – primarily in heavily male-dominated occupations, such as construction and extraction occupations. |
The information provided herein does not, and is not intended to, constitute legal advice. All information, content, and materials are provided for general informational purposes only. The links to third-party or government websites are offered for the convenience of the reader; Syndio is not responsible for the contents on linked pages.
