Latinas Face the Largest Wage Gap, And There's a Business Case For Closing It — 4 Reasons Why

Business benefits of closing the Latina pay gap and how companies can go about achieving equity.

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Sandra Diaz765
I leverage data and systems to deliver results.
June 21, 2024 at 12:36AM UTC

No matter what their job, where they live, or how much education or experience they have, Latinas are still paid less than white men, according to data in a study by Lean In, Unidos US and Survey Monkey. On average, Latinas in the U.S. are paid 47% less than white men and 31% less than white women. Surprisingly, the gap is largest for Latinas who have bachelor’s degrees.

Clearly, equal pay for equal work is a social justice issue. However, if the main purpose of business is to maximize profits for its owners and shareholders, it’s counter-intuitive to think organizations will earn more by increasing payroll. But it works. 

The business case for closing the Latina pay gap:

1. It improves shareholder returns. 

An analysis of the JUST 100 (top companies that do well by doing good) shows that companies who pay their median U.S. employee a third more than other companies do deliver 8% higher return on equity.

2. It drives top-line growth. 

Results from a JUST Capital survey indicate that Americans will buy more from companies that show positive behavior by taking a stand on social issues such as gender pay, discrimination, immigration, climate change, and gun control.

3. It increases employee productivity.

Daily stressors can decrease work performance, according to the Anxiety and Depression Association of America (ADAA). In a survey conducted by the YWCA, nearly half (45%) of Latinas report being very worried about being able to afford their rent or mortgage, decreasing their productivity. 

4. Organizations gain profits from stronger economies.

The Institute for Women’s Policy Research estimates that the U.S. economy would have produced income of $512.6 billion more if women received equal pay, and that the poverty rate would be cut in half, falling from 8.0% to 3.8% among working women.

Three ways to achieve equity, according to pioneers:

1. Tackle widespread ignorance.

Based on the Lean In study, 42% of Americans are not aware of the pay gap between Latinas and white women—and hiring managers are similarly unaware. In addition to a deep dive on the causes of the inequity, it is important that companies highlight the benefits of pursuing initiatives to address the gap as outlined above.

2. Implement proven strategies.

Closing the gap requires revisiting promotion, compensation and incentive policies to reward individual initiative while achieving equity at the same time.  To avoid costly mistakes in the process, companies can look to the approaches used by Salesforce and GoDaddy in the U.S., PricewaterhouseCoopers in the U.K. and companies in Iceland that must comply with the country's equal pay law.

3. Equip Employee Resource Groups (ERGs).

Of the 15 countries with the biggest gender pay gaps in a Business Insider list, six are in Latin America. This means Latinas' inherited mindset may also affect their ability to negotiate better pay. By showing Latinas how to approach career and compensation discussions, ERGs can contribute to keeping companies accountable for putting their money where their mouth is.

Moving the needle on the Latina pay gap will require perseverance, given that there has been no real progress on closing the overall gender pay and labor participation gaps globally. However, by educating its workforce on the extent of problem, looking to pioneers for strategies that work and equipping Latinas to advocate for themselves, companies that lead in closing the Latina pay gap will reap benefits — including better shareholder returns.


Sandra Diaz helps bicultural professionals land great marketing jobs. Students in her job search boot camp ( get more interviews and ideal job offers in 90 days. Sandra’s coaching approach draws from her experience as a marketing executive at L’Oréal, Sears, Sara Lee and Colgate Palmolive, and as an independent consultant. She is an avid learner and connector, frequently in the loop about new job openings.

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