The first consequence of gender pay gap is affecting the standard of living of women after retirement. As the pension fund amounts is depends on the contribution paid by employees from their salaries, women who receive less salaries will contribute lesser to their pension fund. This will diminish women’s living standard after they have retired since the pension fund will be the only sources for them. Hence, this situation has trigger another issue where women are more willing to postpone their retirement as they want to save more money for their retirement life and delay the time they need to rely on social security system which is actually insufficient to meet their essential needs.
Another consequence of gender pay gap is women will be in lower level at household especially in traditional family. Women who receive less in their salaries will be in an economic dependence relationship with her husband where it causes women will have less or no influence over the distribution of financial resource and household chores. This is because the decision power is directly related to the contribution, so women who receive and contribute less to her family will have no power in making decision. According to a report that published by European Commission in 2017, it stated that women who are financial and economic dependence will more exposure to violence, especially domestic or partner violence. The report concludes that woman who receives high or similar salaries with her partner can increase her bargaining power and lower the level of exposure to violence since they are able to defend herself and leave home to find new accommodation in case of violence. This is because the salaries women receive have symbolic meaning where high salary indicate that contribute more to family which should be respect.
Gender pay gap will also directly and negatively affect women’s mental health. According to a research published in U.S. in 2015, it concluded that the prevalence of major depressive disorder (MDD) and generalized anxiety disorder (GAD) are almost twice as high among women compared to men in U.S.. Some women who are clearly realize of the unfair treatment in workplace and reflective those phenomena to inferior merit may increase the risk of suffering MDD and GAD as they focus on the wrong point by keep questioning themselves rather than take it as an unfair discrimination. As mention above, women who receive less salaries has less influence in the distribution of household chores, which cause them still need to work after back from work. This expose women to high level of stress which will then cause them loss of sleep, insomnia and might have the symptoms of anxiety.
Gender pay gap will also affects the economic stability of families. According to the data released by U.S. in 2016, it shows that the trend of middle-class families rely on women’s income is keep increasing where there is 6% of families is solely rely on women’s salaries and 28% of families are composed by a single mother. Hence, the gender pay inequalities will not only affect the economic stability of an individual, it also affect other family member of that woman which will then lead to high number of children live below the poverty threshold.
Gender pay gap issue will not only affects women negatively, it also bring negative consequence to the company. As according to the research done by Milli J. et al (2017), it shows that gender pay gap will result in misallocation of human capital as well as inefficiency work contributed by women. As female employees cannot feel any sense of belonging towards company, the action taken by them will just consider about themselves rather than the benefit of company. This situation will directly affect company’s production and profitability as one of the determinants of financial performance of a company is the employee satisfaction. Besides, company that does not exercise gender equality pay or promotion policy will fail to retain or hire high skill female workers. As according to research published on Vitality, is a newsletter publication of Homewood Health, it mentions that Millennials will comprise 75% of global workforce during 2025 and the females from this generation are highly concern about the social responsibility, ethics, equality and diversity of an organization where all these elements will be their consideration of whether work for that organization.
