I was purchasing T-Shirts for a team celebration recently and was intrigued to find that female T-shirts cost $10 or 25% more than a male T-shirt at $8. The reason I was given by our vendor (something about volumes usually purchased) wasn’t convincing . I realized I was seeing the “Pink Tax” in action.
I recently came across a fascinating 2015 paper by the New York City Department of Consumer Affairs about the cost of being a female consumer. In the 397 retail products compared, women paid more 42% of the time while men only did so 18% of the time.
For example, girls’ toys cost more 55% of the time versus 8% of the time for boys. Girl’s clothing costs more 26% of the time versus 7% for boys. Women’s personal care products cost more 56% of the time versus 13% for men. And so on. This is nuts.
These costs add up over time and have powerful implications on women’s ability to save for retirement – to the tune of a million dollars over the course of a lifetime. Thanks to taxes, a penny saved is worth a lot more than a penny earned.
So, while it is great to see all the efforts going into achieving pay gap equality, we’ll need to pay as much attention to the pink tax. Improving the top line without paying attention to the bottom line is the definition of counter productive.