In a seminal study published in the Industrial and Labor Relations Review in 1995, M.V. Lee Badgett, professor of economics at the University of Massachusetts-Amherst, found that gay and bisexual male employees in the US earned between 11% and 27% less than heterosexual male workers, even after controlling for experience, education, occupation, marital status, and region of residence. In 2009, Badgett carried out a review of a number of studies on sexual orientation discrimination from the 1990s and early 2000s, and found similar results: gay men earned 10% to 32% less than similarly situated heterosexual men.
Over time, pay discrimination has persisted, but the pay differential appears to be decreasing. In 2015 , Marieka Klawitter, professor of public policy and governance at the University of Washington, undertook a meta-analysis of 31 studies published between 1995 and 2012, from the US and other developed countries. She found that on average, gay men earned 11% less than heterosexual men. (But estimates still varied greatly between those studies, ranging from no difference in pay in some circumstances to a gap of over 30% in others.)
Non-heterosexual women are in a completely different situation. According to Klawitter’s 2015 meta-analysis, on average, lesbians earned 9% more than heterosexual women. Social scientists call this phenomenon the “lesbian premium.”
However, pay differential for lesbians varied greatly between studies, and the range of estimates across studies was much wider than for men; in some cases, lesbians earned 25% less than heterosexual women, and in others they earned 43% more. Similarly, in Badgett’s 2009 review, the pay differential between lesbians and heterosexual women varied widely across studies.
The general dynamic—that gay men suffer a pay gap while lesbians receive a pay premium—can be partially explained by the gender bias in pay. Men earn more than women in most occupations, and this inequality plays out regardless of sexual orientation. In fact, in Badgett’s 2009 review, some studies showed that while lesbians earned more than heterosexual women, they made less than straight and gay men.
“In the case of lesbian women, they are compared to heterosexual women, who are really the lowest paid people,” says Badgett. Meanwhile, the earnings of gay men were compared to straight men, who are, on average, paid the most.
Badgett says lesbians tend to be less likely to be held back by the gender norms and expectations for women. “There’s some evidence to suggest that lesbians go into jobs with more men in them—and the more men in the job, the higher the salary tends to be,” says Badgett. For example, looking at both men and women, those who studied education and teaching—one of the most female-dominated job markets in the US—make 61% of the salary paid to who studied manufacturing, engineering, construction, and computing.
Another piece of the puzzle is the difference in work experience between heterosexual women and lesbians. According to a study published in the Industrial & Labor Relations Review in 2008, lesbians are less likely than straight women to work part time or to drop out of the labor market (most likely because they are less likely to take time off to have children). As a result, a lesbian woman’s typical job experience and quantity of work hours is very different than the average heterosexual woman’s.
That’s backed up by a new UK study that found lesbians in a partnership earn more than heterosexual women in a partnership, controlling for education, location, and family structure—but that lesbians not in a relationship earn the same as straight women who are not in a relationship. Cevat Giray Aksoy, principal economist at the European Bank for Reconstruction and Development and one of the authors of the study, argues that the sexuality earnings gap is caused by specialization within households rather than discrimination in the workplace.
“In traditional heterosexual partnerships, one partner might focus on the labor market—full time employment—and the other partner might focus on home production—taking care of the household chores and looking after the children,” says Aksoy. A woman in a lesbian relationship is more likely to take on the labor market than a woman in a heterosexual relationship.
That dynamic has the reverse effect on men: “The average partnered heterosexual man will be more focused on market activities than the average gay man will,” says Aksoy. A 2011 study by Klawitter found that as compared to heterosexual men, gay men worked fewer hours and did less full time work. And Aksoy’s study found gay men in partnerships made less than partnered heterosexual men—but no difference in pay for non-partnered gay men and non-partnered hetero men.
Government intervention is likely key: Data from the UK show that progressive employment equality legislation has played an important role in closing the sexuality pay gaps in public sector jobs. In the US, there is no federal law specifically against discrimination based on sexual orientation or identity, through 21 states (and Washington, DC) do have state laws on the books. In addition, the US Equal Employment Opportunity Commission says employees can file complaints of sexual orientation as claims of sex discrimination under Title VII of the Civil Rights Act of 1964. That, however, is not legally binding
Even if federal legislation were to be passed, it wouldn’t be enough, says Klawitter. “As with gender, and people with disabilities and religious freedom, the laws themselves are not going to completely get rid of discrimination and make workplaces friendlier,” says Klawitter. Continuing public education about sexual minorities and gender identity is vital,” he says. “People need to learn about each other and how to treat each other with respect and that will increase the comfort in the workplace.”