During his State of the Union Address, President
Obama stated “women make up about half our workforce. But they still make 77
cents for every dollar a man earns. That is wrong, and in 2014, it’s an
embarrassment.” Is it true that there is a gender wage gap? A better
question is: Do people who work different jobs, with different skills, and
different work hours earn different amounts of money? The answer is yes.
That 23% difference between what men get paid and
what women get paid is calculated by simply dividing the average earnings of
women by the average earnings of men. Thus, the 23%number is an apples to
oranges comparison that is so superficial that it is rendered meaningless. The
reality of the situation is that there are numerous variables which determine
how much a person is paid. Experience, education, where they work, how long they
work, if they are married, etc are all important factors yet the 23% number
completely ignores them.
There are many reasons why on average, men earn more
than women. Here are some:
-Men work more dangerous jobs. Dangerous jobs tend
to pay highly in order to attract people to take them. In 2009, the rate of
fatal occupational injuries per 100,000 full times workers was 5.5 for men and
0.6 for women [1].
-Men tend to work more in higher paying industries.
For example, engineering (any type) is one of the highest paying jobs in the
country. Not coincidentally, around 90% of engineers are males. On the other
hand, the least well-paying jobs in the US are those of social work, studio
arts, early childhood education, drama and theater, etc. And unsurprisingly,
women make of the majority of these workers. [2]
-Men tend to work longer hours. “[In 2009] Average hours for men were 41.3 per week, whereas
women worked 35.6 hours per week on average.” [3] Additionally, 44% of
full time workers are women compared to 56% which are men. [4]
-Part time workers tend to earn less, even among women. "The hourly pay of women who work part-time has been found to be 20 percent lower than the hourly pay of women who work full time, even when comparing women with the same levels of education and the same family circumstances such as being married, divorced, or with children" [8] Additionally, "Part time workers not only earn less total pay, they are also paid less per hour and are less likely to be promoted. There have, and continue to be, more women than men who are part-time workers" [8].
-Part time workers tend to earn less, even among women. "The hourly pay of women who work part-time has been found to be 20 percent lower than the hourly pay of women who work full time, even when comparing women with the same levels of education and the same family circumstances such as being married, divorced, or with children" [8] Additionally, "Part time workers not only earn less total pay, they are also paid less per hour and are less likely to be promoted. There have, and continue to be, more women than men who are part-time workers" [8].
-Many women take years out of the
labor force to bear children. This time out of the labor force seriously
diminishes the market value of their labor. Mothers tend to have lower wages
than childless women.[5]
-Marriage is also a significant
factor in determining wages. Studies have found that married men earn more money
(around 16% more) than non-married men even when controlling for factors like
education, age, number of hours worked, etc. [6] Research generally finds that marriage
has a negative or insignificant effect on women’s wages [5].
It is obvious that there are numerous factors which
have a hand in determining how much a worker is paid. A true, apples to apples
comparison would analyze the wage difference between men and women of the same
job with similar education, marriage status, skills, etc. Luckily, researchers
have done this. Here are the findings:
- “[A]mong workers who have never been married and
never had children, women earn 117% of what men do. (This factors in education,
hours worked and age.)” [7]
- “Among college educated, never married individuals
with no children who worked full time and were from 40-64 years old- that is,
beyond child bearing years-men averaged $40,000 a year in income, while women
averaged $47,000” [8]
-"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. The differences in raw wages may be almost entirely
the result of the individual choices being made by both male and female
workers." [9]
The findings are clear, when
individuals of similar qualities are compared, the gender wage actually favors
women. Thus, the gender wage gap is undoubtedly a result of individual choices,
not gender discrimination. Anyone who cites the 23% gender wage number is
simply ignoring the fact that there are other determinants of worker’s wages
besides gender. And even then, there doesn’t appear to be any evidence that
gender even plays a role in how workers are compensated for their labor.
Parting thoughts: Intuitively we should
know that paying people less because of their gender is a downright terrible
idea. If women were equally as productive as men but paid less by their
employers, no one would hire men because it would be a complete waste of money
to pay more for the same amount of production. In reality, employers compete
for workers and value workers based on said worker’s productivity. If a company
can make profits by hiring women at higher wages than companies who
discriminate against them, they sure as hell are going to do that regardless of
their own prejudices. In a market economy, discrimination based on sex, race,
etc is punished. Any employer engaging in discrimination must accept the fact
that he will lose productive employees to his competitors or lose valuable customers
to competitors who don’t discriminate against people based on superficial
attributes like race, sex, etc. Either way, discrimination is a financially
unwise decision that most companies refuse to make.
Citations:
[4] Authors calculations based on this data: https://www.census.gov/newsroom/pdf/women_workforce_slides.pdf
[5] http://epc2014.princeton.edu/uploads/140782
[8] Sowell, Thomas. “Economic facts and fallacies”
[9] http://www.consad.com/content/reports/Gender%20Wage%20Gap%20Final%20Report.pdf
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