"Women are officially the economy’s power players—outpacing men in both income and spending growth"
Women Driving Economic Growth Amid Rising Workforce Participation
If you’re looking for a reason behind the economy’s resilience, women may be a key factor. According to new research from Bank of America (BofA), women are playing a critical role in sustaining economic momentum.
The report, What’s the Power of a Woman’s Wallet?, highlights that women’s spending and income growth have consistently outpaced that of men.
Women’s Spending Power on the Rise
Women’s labor-force participation has been climbing, driven by higher graduation rates and an expanding presence in the workforce.
BofA economist Taylor Bowley found that for five of the past six years, women’s median discretionary spending growth has been stronger than men’s.
“Continued strength in discretionary spending, especially as prices across some items within this category have fallen, suggests women have increased potential to drive economic growth,” Bowley wrote in a note seen by Fortune.
Employment Growth Fuels Economic Contribution
A key driver behind women’s spending power is their employment growth, which has exceeded the national average over the past two years.
While the pace of job growth in 2024 was slightly slower than in 2019, industries heavily employing women—including social services, personal services, health services, education, and apparel stores—have seen significant gains.
According to BofA payroll data, these industries saw above-average job growth in 2023, though they aligned more closely with broader employment trends in 2024.
Even so, by September 2024, payrolls in “women-intensive” industries were still expanding at a 5.5% growth rate.
Women’s Workforce Participation Outpacing Men’s
Citing Bureau of Labor Statistics (BLS) data, BofA notes that in the prime working-age group (25-54 years old), women’s labor force participation rate grew twice as fast as men’s over the previous year.
Looking ahead, school enrollment trends indicate that this momentum will likely continue. Male and female college enrollments are now nearly equal, with male enrollment increasing by 1% and female enrollment by 0.9%.
The Persistent Gender Pay Gap
Despite their stronger spending growth and rising workforce participation, women’s earnings continue to lag behind men’s.
According to BLS data, in 2023, women in full-time salaried roles earned a median $1,005 per week, or 83.6% of men’s median earnings ($1,202).
However, BofA’s internal customer account data suggests that women’s median annual income has been growing faster than men’s over the past few years.
When indexed against 2019, by August 2024, women’s median annual income stood at 132.5, compared to 128 for men.
Higher Pay Gains for Women Changing Jobs
A major reason for this shift, Bowley explains, is that women who switch jobs have seen stronger pay increases than men.
While overall raises for job-switchers have been slowing, women have consistently received higher increases than men since 2019, according to BofA data.
By September 2024, the pay increase gap between job-changing women and men stood at just under 2%.
“This rising, positive difference in pay increases for women changing jobs suggests women are narrowing the gender pay gap—likely due in part to more opportunities for higher-paying work and faster wage growth in traditionally lower-paying, female-dominated industries,” Bowley added.