Equal Pay For Equal Work?…..the pay gap for women in the U.S.

 

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A recent survey of the pay gap by gender from the Pew Research Center indicates that average pay for females has remained at around 82% of the average for males, holding steady for the last 15 years or so.  Younger workers in the U.S. have a significantly lower gender pay gap than older workers (89%), but, as suggested in the Pew study, this may be due to older workers holding higher paying jobs.  If so, the gender pay gap for the younger workers could continue to widen as they age.

How does the U.S. rank in the global economy? A recent issue of The Economist (February 2018) indicated that Canada is ahead of the U.S. in the index of environment for working women; in fact, the U.S. is below the average for the 29 countries listed. So, not so well.

There is a lot written on the perceived reasons for the persistent gap.  From my perspective, after 40+ years of HR experience, it is mainly due to the difference in the mix of jobs held by women versus men.  As noted in the Pew study mentioned above….

Even though women have increased their presence in higher-paying occupations traditionally dominated by men, such as professional and managerial positions, women as a whole continue to be overrepresented in lower-paying occupations, such as office/clerical and paraprofessional.

Given that the market drives pay rates based on the value of the job to the employer (“demand”), as well as the availability of qualified candidates (“supply”), one path to narrowing the pay gap is to improve the “supply” of women for the higher paying jobs, which happens through training and education.

But is it also a matter of preference; do women prefer certain jobs over others? One example is the persistent lack of female candidates for engineering jobs, which tend to be higher paying professional jobs.  Another example is the skilled trades (machinists, electricians, carpenters, etc.).

Some economists have speculated that the lower average pay for women is due to their lifestyle choices; choosing to have and raise children being the most impactful choice. These economists reason that employers are not too keen on providing women the time off or reduced work hours/flexible schedules needed to allow them to stay employed and also spend time with their children.  As a result, their careers are interrupted and pay progression moves back rather than forward.

The U.S. DOL is moving to collect pay data from all employers who are required to complete the annual EEO-1 report in order to monitor employer pay practices that may indicate discriminatory treatment based on gender. I do not see how they can reach conclusions regarding pay equity based on the data collected, as the categories to be used are too broad for comparison (i.e. the eight EEO1 categories, covering all jobs from top management to entry-level laborers).  See my more recent blog on this matter.

It is my belief that the pay gap will continue to exist for many more years, but not due to discriminatory practices.  I believe that it will be market-driven forces, i.e. supply and demand, that will narrow the gap, which is a slow process.

Update 

A recent article, “Pay Equity: Having Kids Curbs Women’s Earnings” (April 14, 2019, Janet Paskin, Bloomberg News) points out that there is little if any gender gap at the beginning of the career path; the gap widens once women have their first child. For women who do not have children, the pay gap is much smaller.  It’s clear that lifestyle choices affect the gender pay gap.

 

 

 

Published by Dave the HR Compliance Guy

Human Resource and legal professional specializing in HR compliance advisory services

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