Alas, a Blog

Sometimes ya gotta fisk. Such as when John Stossel writes about the wage gap between women and men.

Feminists keep demanding new laws to protect women from the so-called wage gap. Many studies have found that women make about 75 cents for every dollar a man earns. Activists say the pay difference is all about sexism.

Sure, I’d agree with that. But I’m probably defining “sexism” more broadly than Stossel. Stossel, I suspect, is defining “sexism” to mean “direct employer discrimination.” That’s certainly part of how sexism produces the wage gap, but it’s not the whole story.

For me, probably the most important kind of sexism going into the wage gap is the sexism of unquestioned assumptions; unquestioned assumptions about who does the housework, unquestioned assumptions about who does the child-rearing, unquestioned assumptions about innate ability, and most of all, unquestioned assumptions about how jobs are designed for people with wives at home.

I call this last factor the “Father Knows Best” economy; most jobs implicitly assume that workers have wives at home who are taking care of the kids and house, so that these responsibilities never need to be accommodated for by the employer. Maybe that assumption made sense half a century ago, but it doesn’t make sense now; and by continuing to implicitly make this assumption, our economy is making it unfairly difficult for caretakers (who are usually mothers) to have careers.

“No matter how hard women work, or whatever they achieve in terms of advancement in their own professions and degrees, they will not be compensated equitably!” shouted Rep. Rosa DeLauro, D-Conn., at a “wage equity” rally in Washington, D.C.

But how could this be possible? Suppose you’re an employer doing the hiring. If a woman does equal work for 25 percent less money, businesses would get rich just by hiring women. Why would any employer ever hire a man?

And if we extend Stossel’s logic, we can see that wage discrimination has never happened. After all, in the 1950s, why would anyone have hired a man when women would work cheaper? Why did anyone hire white people in the 1950s, for that matter, when they could have hired blacks cheaper? If we took Stossel’s logic seriously, we’d have to conclude that no discrimination existed in the 1950s. Or any other time, for that matter.

Stossel’s big mistake is assuming that if sexism is behind the wage gap, then it must be entirely a matter of women being paid 25% less than men for identical jobs. But actually, most economists who study the wage gap believe that it’s caused, to a significant extent, by occupational segregation, which means women and men are sorted by the market into different jobs – and the women’s jobs, on average, pay less.

Even if we put Stossel’s big error aside, employers still have good reason not to fire all men on Monday and then hire all women at lower wages on Tuesday: crippling transition costs, fear of discrimination lawsuits, the lack of enough women in the workforce to replace all men, desire to cater to customer prejudices, etc.

Despite all this, the market does sometimes make the sort of adjustment Stossel is discussing. In the 1980s, for example, insurance companies lowered wages (or allowed inflation to lower wages), and over the same time period insurance adjusters changed from a mainly-male occupation to a mainly-female occupation.

Historically, this process has happened many times; for instance, schoolteacher wages dropped as towns discovered that hiring a schoolmarm was much cheaper than hiring a male teacher. Similarly, secretarial wages plummeted as that became a female-dominated occupation. In a well-documented example, bank tellers changed from a male-dominated to a female-dominated occupation as wages (and prestige) dropped. (Currently, I suspect the same process is happening to cantors.)

Martha Burk, chair of the National Council of Women’s Organizations, gave me this simple answer: “Because they like to hire men, John. They like to hire people like themselves and they darn sure like to promote people like themselves.” In other words, men so love their fellow men that they are willing to pay a premium of, say, $10,000 on what would otherwise be a $30,000-a-year job, just for the sheer pleasure of employing a man. Nonsense. It’s market competition that sets wages.

Burk is correct – that sort of direct discrimination does account for part of the wage gap. But it would be a mistake to claim that it accounts for the whole wage gap (of course, I don’t assume that Burk’s full view is represented in this 25-word quote).

In dismissing Burk’s argument, Stossel assumes that either the (more-or-less) 25% wage gap is caused entirely by employers hiring women at 25% lower wages for the exact same job, or that the wage gap is caused entirely by market competition. But this is a straw man; no feminist economist would claim that all of wage gap is caused by men preferring to hire men, even if it means paying $40,000 instead of $30,000.

When discussing direct employer discrimination, it’s more realistic to discuss elements like selective hiring, training, promotion ladders, and other things that are a good deal more complex than John Stossel’s vision of the labor market seems to allow for. Given two equally able applicants for a $40,000 job, one male, one female – which one will employers tend to prefer? Once hired, who is more likely to get mentored? Who is more likely to be given the assignments that lead to promotion? Who is more likely to be perceived as doing good work, all else held equal?

Next comes the obligatory citation of Warren Farrell.

Farrell spent about 15 years going over U.S. Census statistics and research studies. His research found that the wage gap exists not because of sexism, but because more men are willing to do certain kinds of jobs. “The average full-time working male works more than a full-time working female,” Farrell said.

According to the US government’s Monthly Labor Review (April 1997, pages 3-14), the average full-time year-round woman worked 40.8 hours a week in 1995. Men, according to the same source, worked 44.5 hours – a significant difference, but not a huge difference (and not nearly as large a difference as anti-feminists sometimes claim). How much does that affect the wage gap?

Fortunately, we don’t have to do the math ourselves – the US Department of Labor has done it for us. According to a DOL web page in 2001 – a web page that, unfortunately, has since been taken down by the Bush administration – comparing only hourly wages, women were paid 83.2% of what men were paid in 2000. 83.2% is a noticeable difference from the 76% figure for weekly full-time wages – but it still leaves the majority of the pay gap unaccounted for.

Farrell illustrates his findings at lectures by asking men and women to stand in answer to a series of questions about job choices, such as whether they work more than 40 hours a week, outdoors or in a dangerous job. Again and again, more men stand.

Gee – people who like Farrell’s writings enough to attend Farrell lectures, by an amazing coincidence, have job preferences that correspond with Farrell’s expectations. What stunning evidence!

Despite Farrell’s emphasis on “dangerous jobs,” the evidence of a wage premium for things like on-the-job danger or working outdoors isn’t very convincing. For example, the Bureau of Labor Statistics looked at actual wages and job conditions to calculate what job characteristics are associated with higher pay. The graph below shows what they found. The bar that’s furthest to the right – the bar that’s actually slightly negative – represents factors like on-the-job danger and outdoor work. As the BLS says, “Job attributes relating to … physically demanding or dangerous jobs… do not seem to affect wages.”

Danger and outdoor work have a lot to do with Warren Farrell’s stereotypical view of masculinity – but virtually nothing to do with the wage gap.

Suppose two people have equal potential, but one takes on more demanding, consuming, lucrative jobs while the other places a higher priority on family. The one who makes work the focus will be more productive for an employer than the one who puts his or her home life first. The latter will get more of the pleasures of family. So he (and it tends to be “he”) will make more money, even though she would be equally productive and equally rewarded if she made the same choices.

There’s just so much illogic here to be unpacked, I feel like the wardrobe wrangler on a Cher concert tour.

First of all, notice that taking care of children and home is described just as “the pleasures of family.” Well, taking care of children is extremely pleasurable and rewarding work – but let’s not forget that it’s still work. And it’s unpaid work.

Second, it’s true that there’s a wage penalty paid by primary caretaker parents (usually mothers). But why are jobs and careers designed in such a way that primary caretakers are punished? (Remember what I said about the “Fathers Knows Best” economy). And isn’t it possible that in a less sexist society, any parenting wage penalty would be split more evenly between women and men?

Third, Stossel is forgetting that high-paying jobs generally provide pleasure and satisfaction, as well. It’s a pretty safe bet, for example, that John Stossel finds his job provides him with emotional satisfaction and a feeling of accomplishment – despite the high pay. The higher-paid people are, the better the odds are that they have highly satisfying jobs performed in cushy conditions – the exact opposite of what Stossel is suggesting here.

One irony is that some people, especially young women, may make the choices that lead to the pay gap precisely because they have been taught the job market shortchanges women. Women who see the market as hostile may put their hearts into their homes instead of their careers — thus making less money.

Because goodness knows, there was absolutely no wage gap before feminists started talking about the concept.

I’ve written in more detail about most of Stossel’s arguments before. If you’re interested, check out these earlier posts:

• Myth: The Wage Gap is Caused by Men’s Higher Pay for Dangerous Jobs.
• Myth: If women really got paid less for similar work, then employers would replace all of the male workers with female workers.
• The Motherhood Myth.
• Myth: The Wage Gap Only Exists Because Men Work More Hours.
• What Causes the Wage Gap?

Thanks to Outside the Beltway for the link, and “Alas” reader “Barry” (no relation :-P ) for the tip.