Beware the 'Pink Tax' -- Gender-Based Pricing

The disparity in incomes for women doing the same work as men has gotten a lot of attention in recent years. Not enough attention, many claim, because the gap is still about 78%, even in medicine. But a related area of obvious discrimination that has been under most folks’ radar is the so-called “pink tax,” higher prices for women than men for similar items.

In 2015, the New York City Department of Consumer Affairs looked at a range of 800 products and found that women there paid 7% more than men on average. The State of California has found that this disparity costs women an average of $1,351 per year extra. Let’s look at some common examples.

One major financial expense for everyone is a mortgage. Women average a 0.4% higher interest rate than men pay, all other factors being equal. One researcher suggested that part of the reason might be that women tend to follow friend’s recommendations for a broker while men just hunt for the lowest rate. Maybe.

Another area of disparity is in dry cleaning. The same shirt, differently labeled, for instance, averages a 100% margin greater for women than men. The recommendation? Negotiate! For that matter, a large bundle can get you a discount, if you ask. Mine will drop 10% for a $100 load. That is often the key, just ask.

In a related category, women’s clothing cost an average of 8% more for identical items. Girls clothes average 4% more than boys. Girls’ toys are 7% more expensive, even when identical to the boy equivalent.

Moving on, women’s haircuts and hair products average a whopping 48% higher than similar men’s products and services. One solution for women is to read labels and simply buy a similarly constituted men’s product, without scent. For haircuts, look for a salon that bills by time.

Deodorants and personal care products run in a similar vein. A 20% differential for deodorants, 11% for razors, and 13% overall. Again, ignore the pink sales pitch and by the cheaper, but otherwise identical, blue version.

Another biggie for everyone is the cost of automobiles. But, the distaff side may have to pay up to a 50% higher mark-up than their male counterparts when so-called “mystery shoppers” are used. It’s even worse for black women, with the mark-up going to 100%, but that’s another column. The solution is either to have a “beard,” a front man do the work, or to get a blind bid using a gender-free initial in your name.

In a previous column I suggested that the best way for anyone to buy a car is to go to one of the online services that put out bids to local dealers and you get to pick the best offer at that particular time. The bids may vary quite a bit depending upon available inventory, sales incentives and the dealer’s recent sales level. And, it would appear, also your gender.

Finally, gender discrimination does have a few left-handed financial benefits, such as “Ladies Night” discounts. A big one however, is car insurance. Due to our macho manners behind the wheel, men average a $15,000 surcharge over women in our driving lifetimes. Take that, you chauvinists!