The Gender Wage Gap in the Public and Private Sector, Research Paper Example

Introduction

There seems to be a definite gender pay gap.  Wanzenreids’s (2008) 108,628 observations on 26,047 executives and 2,598 firms from 1992 to 2003 showed that women are working for smaller, less profitable, faster growing and less risky firms; that female executives earn 14% less than their male colleagues; and that the gender pay gap is higher towards the upper end of the pay distribution.  More so, even as recently as 2002, women who worked more than thirty-five hours per week for fifty-two weeks per year earned only 78% as much as men (Giddens, Duneir, & Applebaum, 2003).

The question consequently is this: Is the gender wage gap due to gender discrimination, as the media likes to point out, or is it due to other factors, such as the possibility that women’s work is perceived to have less value than comparable work done by men (Alksnis, Desmarais, & Curtis, 2008).  Most sociologists seem to affirm that sexism is a determining factor here.  Sexism, otherwise defined as “attitudes, beliefs, or behaviors that support the unequal status of women and men” (Alksnis et al, p.1417), contributes to the wage gap.

This essay suggests that the causes of the wage gap has, in fact, very little to do with sex-based discrimination at all, as as will be realized if adjustment occurs for three critical elements: (1) self-selection by women into female-dominated industries, which pay less; and (2) self-selection by women out of the workforce periodically (e.g., to raise children), which fragments their work history and thereby reduces their income potential and (3) men ‘s internalized status beliefs that makes them more likely to feel worthy of higher pay.

After assessing the various factors, this essay concludes that it is critical that business practitioners benefit from a clear picture of the extent to which their decisions may inadvertently contribute to a wage gap within their own companies. Finally, viable recommendations for business practice are provided.

Wage Gap

As recently as 2002, it was discovered that women who worked full time year round (i.e. more than thirty-five hours per week for fifty-two week per year) earned only 78% as much as men. Media and sociologists generally attribute the wage gap to gender typing and gender discrimination.  The facts seem to corroborate this conclusion.  England (1992), for instance, remarks that even: “after adjusting for cognitive, social, and physical skill demands, amenities, demands for effort, and industrial and organization characteristics, jobs pay less if they contain a higher proportion of females.”

Sex segregation also seems to play a part. This is where men and women are concentrated in different occupations, and although similar and sometimes women even seem to perform the socially seeming more important role, women are inevitably paid lower than men. A male garbage collector for instance is generally paid 3 times as much as a female nurse.

Although the Equal Pay was established in 1963, pay differences between genders remain.  The Equal Pay Act requires employers to provide equal pay to workers in the same job. But men and women often do not work at the same jobs, and therefore the wage gap has largely remained.  Comparable-worth policies have been suggested, but these have their advantages and disadvantages.   The Equal Pay Act required employers to provide equal pay to workers in the same job, but men and women often do not work at the same jobs.  However, sociologists still show through numerous studies (as indicated in Table 1) that even when men and women are in the same job, men are paid more (Giddens et al., 2003).

Table 1:  A Partial Assessment of Occupations that Show the Ratio Between Female and Male Earnings (1980)

SOURCE: 1980 Census of Population. (As cited by Bianchi & Spain, 1986, p.186)

Investigations conducted by the US Bureau of Labor Statistics in 2002 showed that although the earnings gap between women and men is narrowing, it nonetheless remains substantial (see Table 2), and that since the early 1990s, the gap has remained fairly constant. Why this so (since this specific period and not as much in the 1970s and 1980s where the gap between profession and hence pay demonstrated a transition) is intriguing and it is a source for further research.  Either way, analysts wonder whether this wage gap is temporary (namely dependent on time factors) or permanent (possibly simultaneously, if not exclusively, dependent on other factors).

The size of the gap has definitely diminished over time, but the female-male difference continues to be substantial for full-time, year round workers in America (0.76). On the one hand, sociologists point to numerous research that indicates a great wage gap difference between men and women, sometimes in the same field. On the other hand, some researchers declare that there is a lessening of the wage gap, at least in certain fields such as in education and nursing; that gender inequality, therefore, is a relic of the past; and that the future indicates an even more optimistic picture. According to a Gallup poll conducted in 2005, 53% of Americans believe that women have achieved equality in the workplace. And other researchers propose alternative explanations for the seeming gendered difference in pay. Some of these explanations will be considered in the following section.

Table 2: Women’s Earnings Compared with Men’s in 2002

SOURCE: US Bureau of Labor Statistics, “Women’s earnings Up Relative to Men’s in 2002 quoted by Giddens, Duneier, & Applebaum, 2003, p. 287.

Suggested Reasons (Aside from Discrimination) for Wage-Gap

Self-selection by women into female-dominated industries which pay less

It is sociologically apparent that men and women seem to divide themselves into different occupations (see Table 3).  For instance, in 1989, jobs that were more than 80% female included secretary, child-care worker, hairdresser, cashier, bookkeeper, telephone operator, receptionist, typist, elementary school teacher, librarian, and nurse.  Jobs, on the other hand, that were over 80% male included doctor, lawyer, dentist, taxi driver, plumber, electrician, firefighter, auto mechanic, mechanist, and truck driver.

Ten years ago, most women still worked in primarily female occupations.  Of the 56 million women in the labor force, top ten occupations included secretary, elementary school teacher, cahier, registered nurse, bookkeeper, nurse’s aide, and waitress. Of men, only 25 percent worked in these 3 top ten occupations (Giddens et al., 2003). As late as 2003, a New York Times graph issued by the US Bureau of Labor Statistics showed that secretaries were 99% comprised of women (only 1% being male); the nursing occupation was 93% female, followed by librarians (84% female), teachers (75% female). On the other hand, other, and usually higher occupations such as chemists were 30% male; economist, 55% male; legal profession, 29% male; and police and public officials18% male dominated.   And these are the higher-paying occupations. On the other hand, it may be possible that a gendered preference for different types of jobs explains the job segregation that consequents in a resulting wage gap.

In a similar manner, and as theorized by evolutionary psychologists, it is possible that it is man’s inherently competitive and aggressive drive and desire to earn more money that is responsible for the gender pay gap, and that women prefer a more quiescent, passive way of life devoted to home and family (as discussed later). Gender-based preference for certain jobs can be detected early in life, but then again there is a question whether, and to which extent, this is per socialization (due to enculturation) or evolutionarily innate.

Table 3: The Percentage of Women in Occupations (2003)

SOURCE: US Bureau of Labor Statistics, 2003 (cited by Giddens, Duneier, & Applebuam, 2003)

What this Table shows is that women evidently select nurturing professions as their choice of work environment; and these professions, whether rightly or wrongly, tend to pay lower wages than others.

Self-selection by women out of the workforce (e.g., to raise children), which fragments their work history and thereby reduces their income potential.
Economists (specifically human capital theorists) argue that women intentionally select occupations with decreased wage since these occupations permit them more freedom and time with their home and family.  When women leave the labor force to rear children, the skills that they have deteriorate and they suffer a wage penalty when they reenter.  Employers, furthermore, may also choose to invest less in women workers because they believe women will work less continuously than men and that consequently they will not realize the return on investment in women workers that they will in male workers.

Similarly, Mincer and Polachek in 1974  (Frankel Paul, 1989) argued that because women do not expect to work as much as men throughout their lives, they invest less in acquiring market skills. Women anticipate having children and leaving the labor force to raise them and therefore take jobs which have relatively high initial wage rates but offer little-on-the job training or potential wage growth.  Women, attempting to reenter the job market, suffer a wage penalty when they reenter and have it more difficult (Bianxchi & Spain, 1980).

O’Neill (Frankel Paul, 1989) argues that the 64% wage differential between women’s work and men’s is flawed for several reason, two of these being that firstly it is based on a definition of full-time employment as consisting of 35 hours or more, thus ignoring the fact that women work as much as 10% fewer hours than men.  As corroboration of this, younger women in fact (usually in the twenty-to-twenty-four-year-old age bracket earn 89% of their male peer’s earnings.

Secondly, O Neill demonstrates that this gap has narrowed in recent years, with women of a certain age group earning only 81% of male average salary in 1979. Apparently, education and skill seem to be the defining factors. However, as was argued, even though progress was made in bridging work gap in the 1970s and 1980s, an inertia set in the 1990s, and the wage gap has remained as large as ever.

O Neill speculated that women have lower investment in job due to higher investment in family. More so, women currently employed have worked 60% of their working lives, while men have worked almost continuously.   Upon examining data from the National Longitudinal Survey (begun in 1986) and then measuring the effect on the wage gap after accounting for the influence of certain factors such as male-female differences in work experience, job tenure, and schooling, as well as plant size, and other job characteristics, O’Neill found that the wage gap had narrowed to 12% (Frankel-Paul, 1989).

There are other qualities, more intangible and abstract, that are difficult to measure, but it seems as though sexual discrimination may not be the only cause or even the sole cause to differentiation in the wage gap.

Women tend to take different courses in high school and college, based upon their perceived role in life, and this is particularly true of middle-aged and older women.  Women who were asked “what do you want to do when you’re thirty-five? Do you expect to be predominantly a homemaker, or do you expect to have some kind of career?”  mostly expressed the desire to become a homemaker. Those who chose a career generally tended to gravitate to the higher paying careers such as maths and science and therefore selected those courses in schools and higher education.

Men’s internalized status beliefs

The entire issue could simply be reduced to men and women’s different perspectives about their deserving higher pay.  To elaborate, researchers have discovered that woman’s sense of wage entitlement is generally depressed, whilst men’s is elevated, and that when women’s sense of entitlement was raised, their wage situation rose as well (Hogue, Joder, & Singleton, 2007).  Hogue and Yoder (2003) tested this assumption by first telling both women and men that women generally excel on the upcoming task, and second by emphasizing their abilities to do task due to their educational credentials as college students relative to the high school students who performed the same experimental task. When compared to the control condition, women in the experimental group, it was found, typically not only performed better but also requested and received their higher wages that seemed to indicate that status enhancement would raise women’s pay.  In contrast, however, the wage that men demanded for themselves through (even though, in one situation, lacking lower credentials than the women) remained flat and high across the control and through the two experimental conditions.

These findings accord to status characteristics theory where status is defined according to ones’ standing in a social hierarchy, and where people deemed high in social status are expected to be highly competent.  Their thoughts about their abilities can emanate either from their cognitive assumptions about their status characteristics and/ or from their task-specific characteristics (e.g. being more skilled). These reports too make sense from research conducted on job search which indicates that it is cognition that often drives the outcome: In other words, a person seeking employment, regardless of skills and education, has a better chance of finding a position and, oftentimes, one that is well-paid were he – or she – to approach the search with optimism, a spirit of confidence, perseverance, and persistence. Here too, the relationship between status and outcomes seems to be mediated by competency beliefs.

Recommendations

A business corporation can employ this knowledge in various aspects.

The nursing or secretarial fields, for instance, can indicate that the problem lies not with the perhaps male-dominated hierarchy or manager, but with the gender composition of the job that is traditionally associated with the pay received for that job. Women are naturally attracted to that field of work despite traditionally low pay.

Sociology can sometimes be a depressing field. Whilst sociologists look at the aspects played out on society, an individual can research factors into how to make things better, and, in this particular situation, this is where economics comes into play. Many economists, in this case endorse a “human capital theory” explanation, developed by Gary Becker (1964) that argues that individuals, by investing in their own “human capital”, can stand a better chance to increase their productivity and earnings. “Human capital”, in this sense, includes formal schooling, on-the-job training, and work experience. Those, asserts Becker, who invest more in their human capital are considered more productive, and generally, paid higher wages.

If the corporation finds that women are indeed paid – based on their performance –lower wages than men despite them performing the same goal, the situation needs to be investigated. It may be likely that the woman has not demanded a raise  (in conjunction with status characteristic theory), in other words that her expectations are driving her lower pay. If that be the case, details of Hogue and Yoder’s (2003) experiment can be implemented in a practical way in the marketplace where women’s’ esteem can be boosted by managerial executives maintaining that they excel at their task in a fashion parallel to that of their male colleagues. Secondly, executives can accentuate their educational credentials. Simply the mere fact of boosting their esteem by focusing on their knowledge and ability could further serve to close wage gap.

Drawing research from a 2000 Census, Cohen and Huffman (2007) showed that greater representation of women in management would narrow gender wage gape.  This is specifically so since as Brenner and colleagues concluded: “Unlike her male counterpart, today’s female manager would be expected to treat mean and women equally in selection, promotion, and placement decisions.” (Cohen & Huffman, 2007, p.699).  Unfortunately, it still appears to be that women in management mostly seem to hold lower and middle management rather than higher management positions, and these women do not seem to have introduced material benefits to those below them. In a practical sense, and as extended to this essay, a corporation could narrow the wage gap existent in its institution, simply by moving more women to higher managerial positions.

Corporations must be aware of the fact that stereotypes can even unwittingly influence their decisions.  Individuals responsible for hiring may possibly prefer a man to a woman for a certain job more because he mistakenly links the traits of the job to the specific gender. This does not imply intentional discrimination rather the fact that he – or she – connects particular stereotypes to particular job-holding positions.  As Alksnisn et al. demonstrate “these assumptions about gender-appropriate jobs permeate organizational design, while organizational inertia ensures that the resulting gender-biased practices become very resilient to change.” (p.1419).

Conclusions

Although sociologists and economists tend to point to the gendered wage gap as evidence of gender discrimination in the United States, evidence exists that all might not be as clear as appears.  Women tend to choose lower paying jobs based upon their preferences for home and family, and, possibly too for desire to serve in more nurturing professions. Furthermore, men tend to be more aggressive and competitive by nature, therefore demanding higher pay, whereas women seemingly tend to evidence lower esteem with their abilities and work. Lastly, homework and family disrupts with women’s employment, hence disrupting their job skills and work opportunities when they decide to renter the work force.

Nonetheless, corporations can profit (at least by preventing suits) by ensuring more attention to equal pay, and this essay has provided some strategies that effect.

Bibliography

Alksnis, C., Desmarais, S., & Curtis, J. (2008), Workforce segregation and the gender wage gap, Journal of Applied Social Psychology, 38, 1416-1441.

Bianchi, S. M., & Spain, D. (1986). American women in transition. NY: Russell Sage Found.

Frankel-Paul, E. (1989). Equity and Gender. USA: Transaction Pub.

Giddens, A., Duneir, M. & Applebaum, R. (2003) Introduction to Sociology, London: Norton & Co.

Wanzenreid, G. (2004). How feminine is corporate America? J. Econ. Inequal, 6, 185-209.