Gender Pay Gap

Overview

“When more women are bringing home the bacon, but bringing home less of it than men who are doing the same work, that weakens families, it weakens communities, it’s tough on our kids, it weakens our entire economy.” Thus said President Barack Obama at a “Women and the Economy” event in April 2012 at the White House, where he portrayed American women as victims of pervasive wage discrimination in the workplace.

This theme was nothing new for Mr. Obama. Indeed, it was but an echo of what he had said during his 2010 State of the Union speech—that it was imperative “to crack down” on the purportedly widespread “violations of equal-pay laws so that women get equal pay for an equal day’s work.” That, in turn, was but an echo of what Obama had said just nine days after his 2009 inauguration, when he declared that “women across this country [are] still earning just 78 cents for every $1.00 men earn, [and] women of color even less.” And that, in turn, was itself an echo of Obama’s 2008 campaign pledge to eliminate the gender “pay gap” by taking concrete “steps to better enforce the Equal Pay Act, fight job discrimination, and … give women equal footing in the workplace.”

In the 2008 presidential election, this type of rhetoric earned Obama the devotion of left-wing feminists from coast to coast. Vicky Lovell, a director at the Institute for Women’s Policy Research, lauded the president for projecting “empathy for women’s financial struggles,” and for understanding that “women are more economically vulnerable than men.” Marcia Greenberger, co-president of the National Women’s Law Center, likewise praised Obama for articulating a plan to pass “essential legislation that provides basic fairness in the workplace.”

But the contention that women are underpaid by American employers in comparison to men is demonstrably untrue. As longtime employment lawyer Warren Farrell, who served as a board member of the National Organization for Women from 1970 to 1973, explains in his monumentally important book, Why Men Earn More, the 22-cent “pay gap” is neither a result of gender bias nor workplace discrimination. Rather, it can be explained entirely by the fact that women as a group tend to make certain very logical and legitimate employment-related choices which, while affording them a number of benefits that they value highly, tend to suppress incomes—for reasons that are also logical and legitimate.

Consider some highly pertinent facts, as presented by Farrell:

Far more often than men, women tend to seek employment in fields that are non-technical or that involve the social—as opposed to the physical (and higher-paying)—sciences. Indeed, women tend strongly to enter the so-called “helping professions” such as teaching, elder care, nursing, health services, nutrition, or social work—as opposed to more lucrative fields that are overwhelmingly male, like biology, chemistry, physics, engineering, or computer systems analysis. Overall, women are 53 times more likely to get an MA in education than in the physical sciences.
Women tend to seek employment in fields that offer a high level of physical safety, and thus constitute only 8% of all employees who are killed in the course of performing their work. When jobs entail significant risks to health and safety, they invariably pay extra (“hazard pay”) in order to attract and adequately compensate suitable candidates.
That same economic principle applies also to jobs that are performed outdoors, where bad weather and temperature extremes can make working conditions poor, as opposed to indoors. Women tend to gravitate overwhelmingly toward indoor work.
Women also tend to seek out jobs that offer a pleasant and socially dynamic working environment, whereas men are far more likely to take jobs in fields that pay more to attract people to the unpleasant, sometimes filthy, environments and working conditions that are their hallmarks—e.g., auto repairs, steel work, sewer maintenance, construction, plumbing, and fumigation. It should be noted, however, that the salaries of women who are employed in a number of these fields are actually higher than the salaries of their male counterparts.
Women, as compared to men, tend to seek jobs characterized by lower levels of emotional turbulence, which, by extension, offer somewhat lower financial compensation. For example, 91% of venture capitalists—whose potentially lucrative investments are invariably fraught with high levels of risk, tension, and uncertainty—are men. Straight-commission sales jobs, likewise infamous for their financial unpredictability and psychological stress, are also dominated by men. This pattern holds true even within given professions. In the field of medicine, for instance, women are far likelier to specialize in pediatrics rather than in surgery. While the former entails far fewer round-the-clock emergency demands at unscheduled hours the latter, it also pays considerably less. Only 16% of surgeons, but a full 50% of pediatricians, are women. Men are 11 times likelier than women to be thoracic sugeons, 8 times likelier to be urological surgeons, 9 times likelier to be orthopedic surgeons, and 4 times likelier to pursue careers in cardiac care.
Women tend, much more often than men, to take jobs that offer desirable shifts or flexible working hours. A willingness to do the opposite—as men, statistically, are much more inclined to do—brings certain financial rewards. Night shifts, for instance, pay 10% more, on average, than day shifts for the same work at the same location.
Women, as compared to men, tend to gravitate toward fields that do not require long commutes. Men on average commute 36% farther to get to work, a fact that translates into about $1,500 in extra annual pay. On a related note, only 16% of the business world’s “most frequent flyers” are women.
Similarly, women are more inclined to pursue jobs that do not require geographic relocation. Females, for example, make up only 18% of all workers who are transferred abroad by their employers. A willingness to relocate is generally accompanied by significant pay benefits.
Women, as compared to men, tend to pursue jobs that require fewer working hours per week and fewer working days per year. According to the Bureau of Labor Statistics, 27% of male full-time employees have work weeks of 41 hours or more, versus just 15% of female full-time workers. Another survey, by the Department of Labor, shows that full-time working women spend an average of 8.01 hours per day on the job, compared to 8.75 hours for full-time working men—a difference of roughly 9%. A third study finds that the average male full-time employee works 45 hours per week, as opposed to 42 hours for the average female full-timer. Statistically, the average person, regardless of gender, who works 45 hours per week, earns 14% more than the average person who works 42 hours. These facts alone account for a significant percentage of the so-called “gender gap.” There is nothing at all surprising, or disquieting, about people earning more money for working longer hours.
An even more significant cause of the gender pay gap is that women tend to compile fewer years of uninterrupted service in their jobs than men. Indeed, women are far more likely to leave the workforce for extended periods in order to attend to family-related matters such as raising children. This is simply a life choice to forego some degree of financial reward in exchange for the emotional reward of being an at-home parent, whether full-time or part-time. During the course of their overall work lives, men accumulate an extra 5 to 9 years on the job as compared to their female counterparts, and each of those additional years translates to approximately 3 or 4 percent more in annual pay.

When all of the above variables are taken into consideration, the “gender pay gap” disappears entirely. That is, when men and women work at jobs where their titles, their responsibilities, their qualifications, and their experience are equivalent, they are paid exactly the same. And contrary to conventional wisdom, this is not, by any means, a new phenomenon. According to the Bureau of Labor Statistics, it was true even three decades ago. In fact, even in the 1950s the pay gap between men and never-married women (i.e., those women who were unlikely to have temporarily left the work force in order to raise children) was less than 2%. Never-married white women actually earned 6% more than never-married white men during the Fifties.

According to a 2007 report prepared for the Labor Department by CONSAD Research Corporation, “[Most] wage differences can be explained by ‘observable differences in the attributes of men and women,’ including, among many, the fact that a greater percentage of women than men take leave for childbirth and child care, which tends to lead to lower wages. Also, women may place more value on ‘family-friendly’ workplace policies and prefer non-wage compensation, such as health insurance or flexibility. The statistical analysis, which included these and other variables, produced an adjusted gender wage gap between 4.8 percent and 7.1 percent. The gap shrinks to almost nothing when men and women of equal backgrounds and tenure are compared, according to another study of young, childless men and women.”

In 2009 the Labor Department commissioned an analysis of more than 50 peer-reviewed wage-gap papers and concluded that the aggregate wage gap “may be almost entirely the result of the individual choices being made by both male and female workers.” American Enterprise Institute scholar Christina Hoff Sommers reported:

“In addition to differences in education and training, the review found that women are more likely than men to leave the workforce to take care of children or older parents. They also tend to value family-friendly workplace policies more than men, and will often accept lower salaries in exchange for more benefits. In fact, there were so many differences in pay-related choices that the researchers were unable to specify a residual effect due to discrimination.”

Added Sommers in September 2010: “A recent survey found that young, childless, single urban women earn 8 percent more than their male counterparts, mostly because more of them earn college degrees.”

– Major Resource: Why Men Earn More: The Startling Truth Behind the Pay Gap — and What Women Can Do About It (by Warren Farrell, 2005).