Tuesday, June 1, 2010

My 20,000th post about the wage gap....

...it seems. With a reminder why you (yes you) should read the Male Matters blog
The claim that American women as a group face systemic wage discrimination is groundless.
There are by now many reputable studies that refute the assertion that women are being cheated out of a fair salary by unscrupulous employers. In January 2009, the Labor Department posted a study prepared by the CONSAD Research Corporation, “An Analysis of the Reasons for the Disparity in Wages Between Men and Women." It analyzed more than 50 peer-reviewed papers. Labor Department official Charles E. James Sr. summed up the results in his foreword:

This study leads to the unambiguous conclusion that the differences in the compensation of men and women are the result of a multitude of factors and that the raw wage gap should not be used as the basis to justify corrective action. Indeed, there may be nothing to correct. [See, for example: "For many years, wage discrimination claims brought under Title VII have not been prevalent. In fiscal 2009, only 1% of charges filed with the EEOC included an Equal Pay Act claim."] The differences in raw wages may be almost entirely the result of the individual choices being made by both male and female workers.

Studies summarized in the CONSAD report show that when the proper controls are in place, the unexplained wage gap is somewhere between 4.8 and 7.1 cents and no one can say how much of it is discrimination and how much is owed to subtle differences between the sexes that are hard to measure.  


According to a 2009 Pew survey, “A strong majority of all working mothers (62%) say they would prefer to work part time.... An overwhelming majority [of working fathers] (79%) say they prefer full-time work. Only one-in-five say they would choose part-time work.” To close the wage gap, women’s groups are going to have to find a way to change women’s preferences and life choices

Equal pay day, why not have...

Mark Perry has suggested we designate October 11, 2020, Equal Occupational Fatality Day. That is how far into the future women will have to work to experience the same number of work-related deaths that men experienced in 2008 alone.

Another source and more data
In 2003, the U.S. General Accounting Office observed, “Of the many factors that account for differences in earnings between men and women, our model indicated that work patterns are key.

“Specifically, women have fewer years of work experience, work fewer hours per year, are less likely to work a full-time schedule, and leave the labor force for longer periods of time than men.”

The GAO cautioned that it could not “determine whether this remaining difference is due to discrimination or other factors.”

For example, some experts said that some women trade off career advancement or higher earnings for a job that offers flexibility to manage work and family responsibilities.

In short, more women than men may seek out lower-paying jobs with flexible hours in order to spend time with their families.

If so, when you take two checklists, one of women’s and one of men’s full-time jobs, and go to the exact middle of each, the median, women’s wages will naturally be less than men’s.

But what about comparable full-time jobs? What could account for a wage gap there? Consider just two possibilities.

First, the definition of full-time employment: Most surveys define it as 35-plus or 40 hours a week. But a tremendous difference exists between an employee who clocks 40 hours and one who works 60.

For the same reasons women would seek flexible hours, they also are likely to work fewer hours in a full-time job. Raises, bonuses, and promotions more naturally flow toward employees who work longer hours.

Indeed, when you factor out variables like having children, the wage gap virtually disappears.

In their book “Women’s Figures” (1999), economist Diana Furchtgott-Roth and Christine Stolba meticulously compared data on the earnings of childless men and women aged 27 to 33. They found that the wage gap shrank to 98 cents.


Female directors in corporate America earned median compensation of $120,000, based on the most recently available pay data, compared with $104,375 for male board members, research group The Corporate Library said in its annual director pay report on Wednesday.
At the same time, the study said, women in corporate boardrooms are outnumbered eight to one.
About the gender gap in buisness

The research, by Marianne Bertrand, a professor of economics at the University of Chicago Booth School of Business, and two Harvard economics professors, Claudia Goldin and Lawrence F. Katz, provides a statistical explanation: women with children fall behind because they work less, the study says.

Women executives who do not have children follow career paths that closely replicate those of their male peers. Successful M.B.A. couples have similar work patterns, said Dr. Bertrand. “Women without children married to high-earning spouses are just as likely to work and accumulate post-M.B.A. work experience at an almost identical rate,” she said. “Call a woman without a child a man.”
Until the first child arrives, M.B.A. couples act as mutual drivers, encouraging each other to work more, Dr. Bertrand said. But with the arrival of motherhood, the picture changes. When women executives return to the office, after several months of absence, they typically start to work shorter hours, the study shows: 52 hours per week, compared with an average 58 hours for their male peers, as they adapt to their new double task. “They try to have both pieces,” Dr. Bertrand said.

About a decade after completion of the M.B.A. course, the gap in hours worked adds up to the cumulative equivalent of a six-month difference in job experience between men and women, and the difference is a costly one, the report says.
The relative earnings of female executives start to decline in the first two years after the first child is born, and the rate of decline accelerates thereafter. “Earnings decline linearly with hours worked in the first two years after the first birth, but hourly wage penalties, associated with career interruptions, become evident for M.B.A. women three years after the birth.

Because top executive jobs are hard to fit with motherhood, high-flying women may quit the corporate rat race for self-employed consulting, and then cut back even further on working time: 10 years after completing an M.B.A., 62 percent of self-employed women in the survey sample had made that decision. “They want to be excellent professionally, but they want to be excellent mothers, too,” Dr. Bertrand said.
Another one gets it
All told, women are more than twice as likely to work part-time as men and over the course of their lifetimes, work outside the home for 40% fewer years than men. That accounts for a significant chunk of the pay gap. Then there is a more subtle factor. Despite the many advances the women's movement has brought the U.S., what it hasn't done, thank heavens, is make men and women the same. The simple fact is - and there is nothing nasty or conspiratorial about it - the sexes continue to choose different avenues of study and different types of jobs.

Here's an illustrative example. The college majors with the top starting salaries, according to the National Association of Colleges and Employers, are: chemical engineering (almost $60,000), computer engineering, electrical engineering, industrial engineering, mechanical engineering. Men make up about 80% of engineering majors. Women predominate among liberal arts majors - whose salaries start at a little more than $30,000. Putting it all together, O¹Neill figures that these differences - in choice of work, years in the workforce, and hours of work - could account for as much as 97.5% of the differences in pay between men and women. "The unadjusted gender gap," she concludes, "can be explained to a large extent by non-discriminatory factors."

If more women than men want to become social workers, knowing full well that this is not a high-paying job - well, so be it. If they want to be paid as well as parole officers, then they should become parole officers.

Discrimination occurs when people are barred from professions for which they are qualified, or paid less for doing the same job. It is not discrimination to freely make a choice that has an undeniable economic consequence. Call me an oversensitive female, but I detect a large dollop of patronization here. The theory behind the Fair Pay Act is that the labor market intentionally sets wages in a way that is unfair to women - and apparently we are so stupid that we fall right into this trap, repeatedly making non-rational choices (not just different ones).

Again, the facts suggest otherwise. Since 1979, as more women have entered and stayed in the labor force for longer periods, the pay gap has narrowed, from 63% then to 81% now. Over the same period, according to the BLS, women's earnings have grown much faster than those of men. Women who work part-time actually make more than men who work part-time; and never-married women make almost exactly as much (96.7%) as never-married men.
 What a wall of text....and some nice numbers. Feeeeeeeck out.....

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