The Gender Pay Gap

by Deborah Talbotstudent-849827_1280

In the last half-century, advanced industrial nations have seen immense changes in the position of women in society. They have caught up or overtaken boys in educational achievement. They have joined the labour force and all other facets of public life.

As analysts, we have a tendency to focus on the negative. Sexual harassment, rape, domestic violence and general objectification still go on and are mostly unpunished. Women are thrown out of work easier than men. They take the lion’s share of domestic work and childcare compared to men. But compared to women around the globe, and our recent ancestors, we have unprecedented freedoms.

So the question becomes, with all this freedom and advancement, why do women still end up earning less than men and occupying positions of less prominence in public life and corporations? The answer to that can be found in the process by which women are converted into ‘lesser mortals’ once they have children. When women give birth, they are ‘mummy-tracked’. They can’t put in the hours needed to keep up high-profile careers, and they are gradually sidelined. When that happens, they then become the main carers for children, and later, even elderly relatives. A woman could start off at the peak of her career, have children, and then, within a few years, find herself living the life of her mother.

Some argue, like the Women’s Equality Party, that the problem is men. Indeed, when I wrote about how women balance childcare and work, I was criticised by one of their leaders for not mentioning men. It’s true, men have some part to play, but, unfortunately, people tend to adapt their behaviours to their context, not the other way around. Men will change when ‘the conditions of life’ change, though we do have some outliers.

Some argue we need more legislation to enforce equality. Sure, that helps, but mostly it’s symbolic and difficult to enforce, as the grim statistics that emerge from workplace tribunals suggest. I’d like to see some legislation on discrimination against women because they are mothers, as they have in the States, if only to make a point (“ah ha, see”, I’d say). But as yet it doesn’t seem to have done American mothers much good.

So I found reading the research and writing of Claudia Goldin, Professor of Economics at Harvard University, pretty much a eureka moment. In her paper A Grand Gender Convergence: Its Last Chapter she argues that the problem is not so much men or a lack of law. The problem is the way the labour market is structured, which is what I’ve been arguing for a while…but she does it much, much better.

Her analysis illustrates that men and women have experienced a historic ‘gender convergence’ in pay. This is a controversial point to make, given the slogan ’77 cents on the dollar’ seems to summarise women’s position so well. However, Goldin argues that there is very little difference in pay (although still some) between men and childless women in equivalent professions. The pay gap emerges when there is a demand for workplace flexibility and, therefore, availability and the pay gap with childbirth varies across occupations. It is important, Goldin argues, to look at the features of particular occupations as a human resources problem, and whether they negatively punish a need for flexibility.

Goldin looks at the particular characteristics of jobs and what they mean for pay parity. Some jobs place a high value on workplace involvement, which is a detriment to flexibility, while others do not. Science and technology jobs are examples where flexibility does not engender huge pay inequalities:

“…in comparison with business occupations those in technology and science have far greater time flexibility, fewer client and worker contacts, fewer working relationships with others, more independence in determining tasks, and more specific projects with less discretion over them. Each of these characteristics should produce a more linear relationship between hours and earnings and the greater linearity should produce a lower residual difference in earnings by sex.”

She argues that there is a link between occupations that tag earnings to the number of hours worked, such as business and law….”Individuals who work long hours in these occupations receive a disproportionate increase in earnings.”

But, the employer might say, our job demands that you be present. How can you, as a solicitor, barrister, MP, CEO, and so forth, clock off at 5pm? They say they need certain tasks done as part of the job, and the employee needs to be around for these. In a position where one individual holds complete responsibility for the fulfillment of certain tasks, a demand for flexibility will lower the value of that employee. However, some professions or workplaces enable substitutes for particular tasks, so that any qualified person can do this. In these positions, flexibility is not punished, and pay parity is greater. The pharmacy industry in the US is one positive example of a profession that has greater equality of pay along with flexibility, and it was a change that occurred as a result of other structural changes in the profession, rather than as a result of demand for flexibility.

She concludes:

“A gender gap in earnings exists today that greatly expands with age, to some point, and differs significantly by occupation. The gap is much lower than it had once been and the decline has been largely due to an increase in the productive human capital of women relative to men. Education at all levels increased for women relative to men and the fields that women pursue in college and beyond shifted to the more remunerative and career-oriented ones. Job experience of women also expanded with increased labor force participation. The portion of the difference in earnings by gender that was once due to differences in productive characteristics has largely been eliminated…What, then, is the cause of the remaining pay gap? Quite simply the gap exists because hours of work in many occupations are worth more when given at particular moments and when the hours are more continuous. That is, in many occupations earnings have a nonlinear relationship with respect to hours. A flexible schedule often comes at a high price, particularly in the corporate, financial, and legal worlds.”

In short, women are penalised in the workplace for having children (or indeed, anyone demanding flexibility, but it is still mostly women) because of the way that employment is structured in particular professions and workplaces. If professional success is decoupled from the amount of hours worked, and employers can find ways to allow employees to act as substitutes for each other, then we might go some way to alleviating the pay gap. We could also, in theory, advise men and women much earlier on the professions most likely to accommodate lifestyle changes and needs. Interesting stuff.

Deborah Talbot is a freelance qualitative research and journalist, writing about society, culture and all things urban. She has recently set up a new blog Interurban Lines.



Categories: Rethinking The World

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