The gender wage gap: Injustice or illusion?

 SOURCE:

The gender wage gap: Injustice or illusion? (washingtonexaminer.com)

There is a gap between men and women, but it is not a wage gap — it is an earnings gap. Working women earn less on average than working men, but it is not due to some widespread discrimination or the elusive, conniving patriarchy. 

We're told that women earn only about 77 cents for every dollar earned by men. President Barack Obama repeatedly referred to the 23-cent wage gap, famously calling it “an embarrassment” in his 2014 State of the Union address. 

The next time you hear people using this widely cited statistic as evidence of rampant discrimination against women, ask them to define the term “gender wage gap.” 

They will likely tell you that it is the difference in earnings between men and women doing the same work.

But that is not the definition. Rather, the gender wage gap is defined as “the ratio of the median earnings of women and the median earnings of men.” The 23-cent gap simply compares the median wage of all women working full-time to that of all men working full-time. 

This does not account for gender differences in crucial factors such as occupational choices, job positions, college majors, hours worked, career interruptions, and emphasis on benefits. Ignoring such differences and blaming the 23-cent discrepancy solely on unscrupulous employers is disingenuous.

Men and women are not doing the same work. According to the Bureau of Labor Statistics , men generally work in higher-paying occupations and hold higher positions than women do within the same occupations. A Georgetown study found that while men dominated 9 of the 10 most lucrative college majors, 9 of the 10 lowest-paying majors were majority female. 

Men working full-time are significantly more likely than their female counterparts to work longer hours and more irregular hours. 

Due to childbearing, child-rearing, and elder care, many women experience career interruptions and have less work experience overall. Women are also more likely to choose jobs with lower wages but greater benefits , such as flexible work schedules and paid parental leave.

Once we start to control for these and other contributing factors, the pay gap drops down to single digits. 

The American Association of University Women, hardly a hotbed of the tyrannical patriarchy, found that while the raw or unadjusted gap one year after graduation is 18 cents, the controlled or adjusted gap is only 6.6 cents. 

A comprehensive study by the U.S. Department of Labor has corroborated this figure, concluding that the overall adjusted gap falls somewhere between 4.8 and 7.1 cents. 

The researchers point out that the unadjusted 23-cent gap “may be almost entirely the result of the individual choices being made by both male and female workers” and therefore “should not be used as the basis to justify corrective action.”

What about the few cents that still exist after controlling for relevant factors? Of course, when it comes to the pay gap between men and women doing the same work, one cent is too much. 

But it is not clear that we can even chalk the remaining few cents up to gender discrimination. Psychological attributes, for example, have been increasingly studied by labor economists for their impact on the gender wage gap. 

Research has shown that women are generally less likely to negotiate, less competitive, and more risk-averse. All three traits lead to lower wages and lower representation in high-level jobs.

When asked how much of the adjusted 6.6-cent gap could be attributed to sexism, AAUW spokeswoman Lisa Maatz said , “We are still trying to figure that out." Similarly, the Department of Labor study concludes that “it is not possible now, and doubtless will never be possible” to determine how much is attributable to discrimination. 

There are simply too many factors that go into determining the wages paid to different individuals, making it a “daunting and, more likely, unachievable” task to try to redress gender discrimination through policy. “There may be nothing to correct,” the study notes.

Activists would have you believe that pay disparities are caused primarily or even entirely by discrimination. Serious researchers, as we have seen, balk at this suggestion. 

The well-publicized gender wage gap, they conclude , is mostly due to the different choices men and women make about occupation, family, working hours, negotiation, etc. Gender discrimination accounts for a much smaller portion of the pay gap than commonly supposed and is certainly not the main culprit.

Matthew Xiao is a senior studying economics and mathematics at Cornell University.