Tag Archives: gender wage gap

01.21.2013 | Gender Issues: The Second Glass Ceiling

By Lilli DeBode, guest blogger, senior at Kent Place School

A recent study shows that the glass ceiling not only pertains to employment, but also to marriage. The results demonstrate that as women earn more than their husbands, the frequency of those marriages decreases. In other words, there are tons of couples in which the man makes a greater or equal amount of money than the woman, but there are many fewer couples as income reverses. (It should also be pointed out that all of these couples were in the age range of 22-34 years old, so the presence of children could not really skew the numbers). The study also makes the equally upsetting point that as women start to out-earn their husbands, the rate of divorce increases. Interestingly enough, it did not make a difference how much the disparity between the two paychecks was. Just in general, if women earned more, the occurrence of divorce increased.

The results also show that a woman who has the potential to out-earn her husband often either decides to work less or quit her job altogether. Why is this? It could be because she realizes how detrimental (and possibly terminal) it could be for her relationship. Another explanation proposed by the study was that in marriages in which the woman makes the smaller paycheck, the woman is the one who does the majority of the household chores. Therefore, it only makes sense that if the woman is the one who earns more money, then the man should be the one to take care of the chores. Oddly, this is not the case. Just because of social norms, women, even if they work longer hours and earn more money, are still expected to complete the household tasks.

So what does this mean for the economy? A significant proportion of women are not working at full potential, thus under-utilizing our nation’s production possibilities. Especially at a time in which our economy desperately needs a productivity surge, gender norms and stereotypes should not be hindering our economy to this extent.

Sources and Resources: To read more about this issue, New York Magazine has a very interesting article about the troubles which can stem from having a relationship in which the woman is the “alpha.” The Economist also has an article which discusses the issues above in more depth.

Note: The title was slightly edited after this entry was posted.

Posted by: adminEcon
Tags: gender issues, gender wage gap, glass ceiling, production possibilities, working women
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04.21.2012 | Women’s Wages

I just learned that April 17 was Equal Pay Day. Assuming that the average woman earns 22 percent less than the average man, she would have to work until mid-April to equal his pay.

For women’s pay statistics, I like to look at the Institute for Women’s Policy Research (IWPR). In a recent paper, they say the gap is 17.8 percent because a typical woman’s median weekly earnings are $684 while for men, $832.

Calling it “occupational segregation,” the IWPR reports that jobs we associate with women pay less than “male occupations.” For example, female secretaries earn $651 a week and even that is $16 less than their male counterparts. Similarly, female cashiers earn $373 weekly and male cashiers, $411. You can see that in lower paying “female” jobs, still men earn more. (All amounts are for median weekly earnings.)

For the wage gap in occupations dominated by men, the IWPR shows that although the wages are higher, again, women take home less. The median weekly earnings for female drivers/sales workers/truck drivers is $511 a week. A male in the same category? $712. Female janitors/building cleaners? $418. Male janitors/building cleaners? $514. Female CEOs? $1464. Male CEOs? $2122.

Focusing on the wage gap for professional women, Harvard economists Clauda Goldin and Lawrence Katz cite children as the reason because women take more time off for child rearing and that time off decreases their lifetime earnings. Even women with career continuity tend to select lower paying specialties like general practitioners rather than neurosurgeons or salaried in-house council rather than a high pressure law firm. And, for working mothers with an MBA, 15 years after graduation, the gender pay gap is 25%.

Super Freakonomics tells us that women are subject to greater pay discrimination for being obese or having bad teeth.

The Bottom Line: Supply and demand for men and women differ in labor markets.

If you would enjoy reading more about the gender pay gap, the occupational charts are fascinating in the IWPR report. For a lighter approach, the Freakonomics blog quotes Goldin and Katz. But, if you prefer seeing their conclusions firsthand, you can look at one of their papers here.

And finally, an interesting fact: It matters where you live. Washington, D.C. has the smallest wage gap while Wyoming has the largest. This Huffington Post article tells more.

Posted by: adminEcon
Tags: Equal Pay Day, female occupations, gender wage gap, IWPR, male occupations
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04.20.2012 | Female Human Capital

To one group of economists, oral contraception is all about human capital.

1970 appears to have been a turning point. 40 years ago, increasingly, women started entering law school, medical school and other professional programs after college. Instead of majoring in education, more women became judges, physicians, dentists, architects, veterinarians. They entered professions that required years of their time.

As a result, female human capital–a woman’s accumulation of productive knowledge–became more valuable.

Asking why, some economists are saying one reason is oral contraception. The proliferation of birth control pills among unmarried women that started during the early 1970s helped them to time marriage and children. Once women could plan child birth, they could better determine when and how to develop their professional skills-their human capital. They could enter and complete longer educational programs, decide the duration of employment, and have control over professional goals. As a result, women entering labor markets could earn more. Earning more, their value climbed in marriage markets. And, because more women were marrying later, postponing finding a spouse was a less costly decision since, as economists Goldin and Katz express it, marriage markets for older women “thickened.”

Our bottom line: A recent economic study suggests that the pill helped to narrow the gender wage gap, to “upgrade” women’s career choices and to encourage later marriages and child birth. I wonder also whether it materially contributed to U.S. economic growth (but could not find data to confirm it.) Yes, oral contraception is a major social issue but its economic significance is probably considerable.

I started researching the economic impact of oral contraception after reading NY Times financial journalist, Annie Lowrey’s economix blog. That took me to papers by Goldin and Katz from 2002 and a group from the University of Michigan. I also looked at an interesting discussion of “The Efficiency of Gender Equity.”

Posted by: adminEcon
Tags: feminism, gender wage gap, human capital, labor force participation, labor markets, marriage markets, professional schools
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08.07.2010 | Working Moms: The Good and the Bad News

Two recent studies about working moms give good news and bad.

The good first. If you work during your child’s first year, and you contribute considerably to the family income, or if your child care is very good, or if you are sensitive to your children, then his or her cognitive development will equal those of stay-at-home moms.

Now the bad. As a working mother with an MBA, 15 years after graduation, “lesser job experience, greater career discontinuity and shorter work hours…,” will contribute to a gender pay gap of 25%. By contrast, perhaps as illustrated by Elena Kagan, Sonia Sotomayor, and Condaleezza Rice, women whose careers resembled those of men earned equal pay.

The Economic Lesson

Labor force statistics include participation rates. Defined as a statistic that compares the size of the labor force to its potential total, female participation rates for June, 2010 were 58.5% while male participation rates were close to 71.3%.

The labor force includes all people who are employed, who are looking for a job, and who are 16 or older. There are close to 155 million people in the U.S. labor force.

Average gender wage gap differentials for different occupations are noted in an earlier econlife post. For different countries, you can look here.

Posted by: adminEcon
Tags: Claudia Goldin, gender wage gap, Jane Waldfogel, mommy track, participation rates
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