Thursday, August 19, 2010

The U.S. Chamber of Commerce on Gender Gap in Earnings

This august body tells us silly gurlz that it's our own fault if we earn less. Honest. They know the causes of the gender gap better than researchers in the field! And it is that we choose to earn less:

On the organization's official blog, ChamberPost, Senior Director of Communications Brad Peck today makes the argument that the pay gap between men and women in the American workforce — women currently earn roughly 77 cents to every dollar a man earns — is "the result of individual choice rather than discrimination."

How does Mr. Peck (heh) know this*? To see what research actually tells us, read my three-part series on the gender gap in wages at It's still relevant even if the actual numbers have slightly changed.

But if you don't care to spend this lovely day reading me, here's the gist of the argument that matters here:

1. Most well-conducted studies of the gender gap in wages manage to account for (usually a lot) less than half of the gap with variables which might be seen as having something to do with "choice", such as whether a woman has children or not and how young they are, what her educational qualifications are and so on.

Note that all of these "choices" may be affected by past discrimination (in, say, early childhood upbringing, such as being brought up into the proper female role in a Quiverfull family or, in some countries, in being banned from studying certain fields, or more obviously, in the cultural message that women should stay at home with their children).

But even this relatively lax interpretation of "choice" leaves most of the earnings gap unexplained. How does that turn into Peck's argument that the gap is due to women's choices and not discrimination?

Add to this the difficulties of both identifying what is choice-based and what is discriminatory. Note that most discriminatory acts are not advertised in cat-sized letters on television. Indeed, discriminating employers and colleagues and customers probably don't think that they are discriminating at all. So-and-so is just clearly a bad worker and her gender has nothing to do with it, nothing at all. Women who have been discriminated against may not know about it, either.

2. Laying out the choices as "individual choice" and "discrimination" is both simplistic and fuzzy. What does Mr. Peck mean by "individual choice"? Did Anne Boleyn make an individual choice when she chose the executioner's sword over the axe after Henry VIII sentenced her to die? In a simplistic sense she did. But obviously her choice was made under constraints (she probably would have preferred a longer life), like all choices, and Mr. Peck's argument manages to hide away the fact that the constraints may differ by gender.

For instance, if the culture in the U.S. thinks that mothers should be with their children full-time and that anything wrong with said children is the fault of the mothers, especially if they are ambitious and career-oriented, then women who happen to be ambitious and career-oriented may still make the "choice" of earning less, especially if no good childcare can be found and if their partners don't "choose" to participate in the rearing of their own children.

It is these kinds of "individual choices" so many women make so very "freely". Some even begin earlier by "choosing" careers which pay less but which offer both more flexibility for later childcare (teaching) and a slower rate of decay in information and skills should one exit the labor force temporarily. Whether such "choices" indeed are real choices is an interesting debate. It might also be fun to reverse this whole discussion to note that the "choices" men make to aggressively pursue a selfishly satisfying career path are usually dependent on a suitable female partner taking on the family-related obligations.

But of course there are women who freely and after careful thought choose to earn less, for all kinds of reasons. There are even men who make the same choice. And there are women and men who don't plan their working lives very carefully or who expect not to be the major breadwinners of their families (though the latter is perhaps less true for men, given the cultural hints). Of course there are, just as there are women (and men) who would prefer to stay at home with their young children or perhaps to stay at home altogether. But Mr. Peck's certain-sureness of the gender wage gap being mostly caused by "individual choice" is pure rubbish.

His use of the term "discrimination" is equally vague. Is he talking about direct labor market discrimination, i.e., unequal treatment for equal work or work of equal value in hiring, firing and promotions? Is he talking about discrimination in earnings alone or also about discrimination in, say, on-the-job training or in access to mentoring or the secret cabals which appear to determine so much in larger firms?

He clearly omits any other type of discrimination, such as differential access to education prior to the time a woman enters the labor market or the way fundamentalists of various stripes bring up their daughters so that the latter can never really earn a living wage. But it's unclear what his concept of discrimination includes.

All this means that Mr. Peck compares two undefined concepts and then declares a conclusion which proper research cannot substantiate. The whole thing is then posted on the U.S. Chamber of Commerce website. Nice, eh?

Still, discussing Mr. Peck's ideas offers us one useful reminder: Young women should get proper training on what it means to pick a certain career path in the longer run, not only in terms of job satisfaction or flexibility but also in terms of later earnings and retirement income. Young women should be taught how to negotiate a good salary, and they should also be taught how to apply for promotions and raises and how to make sure that their hard work is properly noted by the powers that be.

*No, repeating the study the IWF always quotes is not knowing. That study compared highly educated young women and men at the very beginning of their careers and found that the gender wage gap within this group was extremely small. As I mention in my gender gap series, comparing new educated entrants into the labor market doesn't tell us much about the wage gap for the obvious reason that it hasn't had time to develop yet.

How would you manage to create one that fast, if you wanted to? Paying different salaries for the same job is illegal based on the 1963 Equal Pay Act, so earnings discrepancies would develop later, whether they are based on "choice" or "discrimination", in the form of differential raises, promotions and firings.

Thus, the study, much hailed in anti-feminist circles, tells us nothing about the real determinants of the gender gap in earnings. Though it indeed compares "like with like", as its adulators argue, it compares them in a situation which will not be repeated and in circumstances which make discrimination very difficult to achieve.