Employment of Women: Survey of Issues & Initiatives — Equal Pay

This entry is part 2 of 4 in the series Employment of Women: Survey of Issues & Initiatives


By Beth Hanson, with George Lenard

Stressed working woman glancing at clock showing almost 5 PM

Women’s Bureau Priority One: Equal Pay

The Women’s Bureau of the U.S. Department of Labor is a government agency created to monitor and remedy barriers to full integration of women into the workforce. This series looks at the current priorities identified by the Women’s Bureau.

Equal pay is the Women’s Bureau’s first priority.

The Wage Gap

Though it’s been nearly 50 years since the Equal Pay Act was passed in 1963, there still remains a wage gap between women and men. The median earnings of full-time women workers are about 80 percent that of full-time male workers. This represents a large improvement over the 59 cents-on-the-dollar average of 1963, but it obviously remains a substantial, stubborn gap. Also, it has not improved significantly over the last decade.

The gap in pay may start out small–a matter of cents per hour–but it grows over time, as seen in this graph:

Graph of womens earnings gap by age

Based on the wage gaps in 2010, by age 25 a woman working full time will have earned $6,000 less than a man working full time. By age 35, again using 2010 data, a woman who experiences the typical gap will have earned $28,000 less over her working career than a man. By age 65 the lifetime earnings gap will have ballooned to $379,000.

Causes of the Wage Gap

Questions have been raised about the extent to which discrimination is responsible for the pay gap, as opposed to more benign factors such as career choices and time taken off from careers for childrearing.

Some studies have found that a significant gap remains even after accounting for such neutral factors.

According to a White House Fact Sheet, “Closing the Gender Wage Gap”: “The pay gap cannot be fully explained by a set of measurable variables –- when controlling for factors such as experience, education, industry, and hours, among others, the wage gap still persists to a large extent.”

Others are skeptical that the pay gap is a real problem.

See “8 Reasons Why The ‘Gender Pay Gap’ Is A Total Sham,” discussing the following nondiscriminatory reasons to explain the pay gap:

  1. Men are far more likely to choose careers that are more dangerous, so they naturally pay more.
  2. Men are far more likely to work in higher-paying fields and occupations (by choice).
  3. Men work in less desirable locations.
  4. Men work longer hours than women do.
  5. Men are more likely to work on weekends.
  6. Even within the same career category, men are more likely to pursue high-stress and higher-paid areas of specialization.
  7. Unmarried women who don’t have children actually earn more than unmarried men.
  8. Women business owners make less than half of what male business owners make, which, since they have no boss, means it’s independent of discrimination.

A 2009 study prepared for the Department of Labor concluded:

Although additional research in this area is clearly needed, this study leads to the unambiguous conclusion that the differences in the compensation of men and women are the result of a multitude of factors and that the raw wage gap should not be used as the basis to justify corrective action. Indeed, there may be nothing to correct. The differences in raw wages may be almost entirely the result of the individual choices being made by both male and female workers.

This study (which apparently did not prevent the Women’s Bureau from considering redressing the pay gap a top priority) also said:

[I]t is not possible now, and doubtless will never be possible, to determine reliably whether any portion of the observed gender wage gap is not attributable to factors that compensate women and men differently on socially acceptable bases . . . . (emphasis added)

For a thorough, well-referenced summary of research on the gender pay gap, see wikipedia, “Gender pay gap,” and “Male–female income disparity in the United States

Perhaps the difference between those who see the pay gap as a major problem and those who do not lies in the words “socially acceptable bases” For example, it may be” socially acceptable” in some quarters that a woman who has been out of the work force for ten years caring for children at home will never catch up in pay with a man who worked through those years — even once her skills and ability have recovered from the effects of her absence and risen to the same level as those of the man.

But this is not considered socially acceptable or economically just in other quarters, from which there continues to be political pressure to address actual or perceived gender discrimination in compensation.

The Ledbetter Fair Pay Act

In early 2009, President Obama signed into law the Ledbetter Fair Pay Act, which Congress passed in response to a 2007 Supreme Court ruling against Lilly Ledbetter, the act’s namesake, who worked for 19 years in a tire factory for less pay than her male counterparts.

In Ledbetter v. Goodyear Tire & Rubber Co, 550 U.S. 618 (2007), the Supreme Court had ruled in favor of Goodyear because Ledbetter’s discrimination charge against it had been filed more than 180 days after the alleged discriminatory decision had been made made, though within 180 days of the most recent paycheck affected by this decision.

The Ledbetter Fair Pay Act directly changed the law as pronounced by the Supreme Court in Ledbetter v. Goodyear, so that now the statute of limitations for filing an equal-pay charge resets with each new discriminatory paycheck.

The Equal Pay Enforcement Task Force

The wage gap has caught the attention of the Obama administration. In 2009, in an effort to equalize women’s pay, it created the White House Equal Pay Enforcement Task Force, chaired by Vice President Joseph Biden. The Task Force unites the EEOC, Department of Justice, Department of Labor, and Office of Personnel Management.

Current Priorities of the Equal Pay Enforcement Task Task Force

The Equal Pay Enforcement Task Force has identified five factors inhibiting progress towards equal pay.

  1. Three federal agencies have distinct responsibilities for enforcing laws against pay discrimination and do not consistently coordinate such responsibilities.
  2. The government’s ability to understand the full scope of the wage gap and to combat wage discrimination can be improved with access to more data from private sector employers, who are not required to report gender-identified wage data to the federal government.
  3. Both employees and employers are insufficiently educated on their rights and obligations in terms of wage discrimination.
  4. According to the Government Accountability Office, there is currently an 11 cent pay gap between the sexes employed in the federal government.
  5. Existing laws may not provide federal officials with sufficient ability to combat wage discrimination. The Obama Administration believes proposed legislation — the Paycheck Fairness Act — would close such loopholes. This law would:
    • allow employees to disclose salary information to co-workers
    • require employers to show that wage discrepancies are based on genuine job-related business requirements
    • prohibit retaliation against those who raise wage-parity issues
    • provide resources to help women develop their negotiating skills
    • support research to understand the lingering causes of wage discrepancies between men and women

Task Force Equal Pay Recommendations

Last summer, the Equal Pay Enforcement Task Force collaborated with the White House Middle Class Task Force and the White House Council on Women and Girls to make equal pay recommendations. The recommendations were:

  • The EEOC, Department of Labor, and Department of Justice will work together to enforce wage discrimination laws as well as increase both outreach and education on wage discrimination.
  • The EEOC will evaluate its wage data collection needs and capabilities, and will coordinate with the Office of Federal Contract Compliance Programs (OFCCP) to minimize reporting burdens on employers.
  • The EEOC will also work with the Office of Personnel Management to ensure that the federal government eliminates wage disparities where both sexes are employed by the federal government to do identical work.

Conclusion

Aggregate statistics on pay disparities between men and women still show a significant pay gap. While much of this gap may be explainable by factors other than discrimination, it is still an issue that warrants research and monitoring.

Even if discrimination is a relatively small factor, it is unlawful when it occurs, so government efforts to improve mechanisms for enforcement of equal pay laws are important.

Finally, some of the nondiscriminatory explanations, such as women’s career choices, or their weaker negotiating skills, may nonetheless be a legitimate subject of concern. There may be, for example, valid reasons aside from reducing pay disparities to encourage more women to sharpen negotiating skills and to pursue scientific and technical careers.

Series NavigationEmployment of Women: Survey of Current Issues & Federal Initiatives — IntroductionEmployment of Women: Survey of Issues & Initiatives — Workplace Flexibility

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