How Latinas Are Combating The Wage Gap Via Entrepreneurship

In 2024, the Latina pay gap widened for the first time in 20 years. That’s because Latinas working across full time, part time and seasonal work this year are paid 51 cents to the dollar paid to white, non-Hispanic men, according to the American Association of University Women.

Net net, Latinas stand to lose $1.2 million over a 40 year career. But Monica Ramirez, author, attorney and social entrepreneur who has advocated for the Latina Equal Pay Day campaign for more than a decade, said this kind of disparity can widen to $2 million under the most severe pay gaps.

“When I look at the data, I question why after having organized with so many people, why over the course of a decade have we seen very little progress?” Ramirez asked.

She calls out the action items Latinas are given every year: to negotiate their salary, ask for more pay and annual reviews.

Yet, Ramirez said, these courses of action don’t address systemic racism and sexism at play. According to a Lean In report, researchers believe that bias is to blame for more than half of the pay gap for Latinas, citing studies which found that workers with the same human capital attributes still presented a 33 percent wage gap for Hispanic women—relative to white men.

As they seek to generate wealth, Latinas are taking matters into their own hands and launching their own businesses. Before the COVID-19, Latinas were generating businesses at a times higher rate than other groups, according to a report from UnidosUS. Following the pandemic, Latinas took a moment when many companies shuttered as an opportunity and since then are opening businesses at a faster rate than Latino-owned businesses, the Latino Business Action Network’s entrepreneurship report cites.

It makes sense then for Latinas to think “I need more money, and the only way I’m going to get more money is if I’m my own boss,” Joelle Martinez, President & CEO of the Latino Leadership Institute, said. Martinez, who is in the business of helping lead the next generation of Latino leaders, is no stranger to the Latina wage gap stats, which this year would push Latinas with earnings to 2207 in order to reach pay equity with White, non-Hispanic men.

Staci LaToison, CEO of Dream Big Ventures, a global consulting firm, and host of Her Money Moves podcast is one former corporate employee-turned-entrepreneur who decided to run her career under her terms following a more than 20-year-long career at Chevron.

“Traditionally, we don’t see ourselves in those leadership positions,” LaToison said. “That’s a big reason I started the podcast. All those years that I was in corporate America there was never a Latina in the C-suite, and there still isn’t today. I never felt like it was possible, but now that I’m an entrepreneur, I see [it] in my network.”

Today, LaToison runs a business with more than one million dollars in assets under management, and less than one million dollars in annual recurring revenue. As she’s delved into the world of entrepreneurship, LaToison has learned what makes a profitable business through trial and error. She’s learned that time is currency, the power of leveraging her network, hiring a team with winning expertise, pursuing multiple bids, and building a portfolio demonstrating high performance.

“If you did not win a contract, you have a right to contact the company and ask for feedback so you can be competitive next time,” LaToison said.

Latinas are not only building their businesses here in the United States, but also bringing their expertise from abroad. Daniela Carvajalino, founder of the ed tech platform she created in Colombia with her two sisters, The Biz Nation, has worked to upskill 100,000 small business owners abroad and domestically in regions including Atlanta, Miami and Puerto Rico.

“Most [entrepreneurs we have worked with] migrated from Latin American countries, find it hard to get a good job and then start their own businesses,” she said. “They are hustlers.”

One of the biggest ways Latinas can remain competitive in their entrepreneurship is through their adoption of AI, Carvajalino said. According to recent reports from the Latino Donor Collaborative, Latina-owned businesses are already adopting AI technologies at a significantly higher rate than white-owned businesses. Staying ahead of the curve will be critical to their success.

Carvajalino, an entrepreneur herself, today runs a company generating more than five million dollars in annual recurring revenue, and said she doesn’t see herself doing any other career.

“Nothing in life is going to be easy,” she said. “I pick my hard; I like what it gives me.”

While Latinas are launching businesses at record rates, Martinez notes it’s also important to watch the longterm growth of Latina-led businesses. For instance, Latino business owners tend to be sole proprietors and few make more than one million dollars in annual recurring revenue, where they tend to hit a “scale wall”. The opportunities here Martinez finds are in teaching entrepreneurs sales and revenue growth at later stages in their companies.

Another opportunity is in closing the access to capital gap for Latinas, via access to federal dollars, loans and venture capital. Latino founders only receive two percent of VC funding, according to Crunchbase. This is a trend that carries over to companies founded by women.

“We need people to start their businesses but be resourced so that they can maintain their businesses and keep their doors open,” Ramirez said, adding that classes as Latino businesses scale would be crucial to help businesses grow in the long haul.

When it comes to addressing the ever-widening pay gap for Latinas at large, Ramirez said change will need to come from the top.

“Congress has to be brave enough to change it,” Ramirez said. “Companies are going to have to be accountable according to the law. Workers are going to have to know their rights so they can then be afforded the protections under the law. Society is going to have to change when it comes to placing a value on who we are as Latinas and all the ways that we contribute.”