Why Care Work Still Pays Less: How Gendered Jobs and Undervalued Skills Shape Wages

The study finds that despite rising demand for social skills, jobs dominated by women, especially care work, continue to pay less, not because they require fewer skills, but because those skills are systematically undervalued. Without policy intervention, occupational segregation and the undervaluation of care work will keep gender wage gaps firmly in place.

A study, led by Hannah Liepmann of the International Labour Organization’s Research Department in Geneva and Ariane Hegewisch of the Institute for Women’s Policy Research in Washington, examines why gender pay gaps persist in the United States despite decades of social and economic change. Published as ILO Working Paper 158, the research looks beyond individual education or experience and instead focuses on how entire occupations are valued, especially those dominated by women. Using data from the U.S. Current Population Survey spanning 1972 to 2024, the authors show that where women work still matters enormously for how much workers earn.

Occupational Segregation Has Barely Gone Away

The study finds that women and men continue to work in very different jobs. While the U.S. labour market became more gender-integrated from the 1970s through the early 1990s, progress slowed sharply after that. By 2024, nearly half of all working women or men would still need to change occupations for jobs to be evenly shared by gender. Care-related jobs, such as nursing, teaching, childcare, and personal care, remain overwhelmingly female, with only small increases in men’s participation over time. In contrast, many business and professional roles have become more gender-balanced, while technical trades, construction, and IT remain largely male-dominated.

Female-Dominated Jobs Come With a Pay Penalty

This separation matters because it affects pay. The authors find a strong and long-lasting link between the share of women in an occupation and lower wages. Even after accounting for education, age, working hours, race, location, and the overall gender wage gap, occupations with more women consistently pay less. In recent years, a one percentage point increase in the female share of an occupation is linked to about a 0.2 per cent drop in wages for both women and men. Moving from a male-dominated job to a female-dominated one can mean earning more than ten per cent less each year. Crucially, this pattern has barely changed over the decades and has actually become stronger among college-educated workers.

Social Skills Are Valued, But Not in Care Work

The paper then tackles a puzzle. Modern research shows that social skills, such as communication, empathy, teamwork, and persuasion, are increasingly valuable in the age of automation and artificial intelligence. Care work relies heavily on exactly these skills. Yet care workers remain poorly paid. By combining labour data with occupational skill measures from O*NET, the authors show why. In business services, higher social skill requirements are rewarded with clear wage premiums. In care services, the same skills bring little or no pay increase. Care workers, despite using the highest levels of social skills in the economy, do not see these skills reflected in their wages. Cognitive skills are rewarded across sectors, but social skills are uniquely undervalued in care.

Why the Market Undervalues Care, and What It Means

The authors argue that this gap is not accidental. Care work produces benefits that spread far beyond the individual worker and client, healthier populations, better-educated children, reduced disease spread, and more people able to work because care needs are met. Because these benefits resemble public goods, markets struggle to price them properly. Public funding only partly fills the gap, while care workers often have limited bargaining power and face cultural assumptions that treat care as “natural” women’s work rather than skilled labour. The study concludes that without policy action, such as stronger public investment, better wage-setting mechanisms, and improved labour standards, the growing care economy will continue to reinforce gender inequality rather than reduce it. Valuing care work properly, the authors argue, is not just about fairness to women, but about building a sustainable and productive economy