The Wage Gap: Why It Matters
It was a quiet moment between carpooling kids, work and the daily frenzy of a mom on the go – a cozy chat with a friend over coffee and croissants. After covering children’s sports schedules, great books and parenting styles, the talk turned to the wage gap between men and women.
My friend confessed, “You know, I’ve been thinking about the wage gap, and although it’s not fair, men frequently need to make more money in order to support a family, while women often just provide secondary income.
“At my husband’s work, it often seems like women are pushed in front of men just to make some sort of invisible quota, or to make the numbers look good. And that’s not fair either,” she continued.
Here we go. Right into the thick of it.
I tried to think of an appropriate response, particularly since my friend, knowing that I vigorously oppose gender-based wage gaps, felt comfortable sharing her differing thoughts in a respectful manner.
My brain went into slow motion as I came to grips with the fact that my relaxed, cozy chat had come to an end. And, I punted.
Not wanting to give up the quiet, friendly moment. Not wanting to break the trust of a personal confession, I smiled, said I understood many people felt that way, and promptly changed the subject.
But the moment haunts me.
It was a missed, and rare, opportunity for true dialogue. Sharing real thoughts and continuing to talk after the point of disagreement is the main way to move beyond knee-jerk, polarized politics.
This is one of the main problems of modern feminism, and modern politics as well. While data, statistics and depressing numbers abound, there are far too few talking points that can briefly cut to the quick over coffee and pastries. And, in our increasingly polarized society, there are far too few responses that can sympathize with a personal confession, respectfully differ, find a reasonable solution, and then go back to sipping said coffee.
I’ve ruminated on an appropriate response ever since.
The truth is American women are losing economic ground. The U.S. Census Bureau reported in August 2004 that the wage gap between men and women is increasing. In 2002, American women made 76.6 cents for every dollar made by men, and in 2003 that number dropped another penny.
Washington state is no exception. Like the rest of the country, it has seen an increase in the gender-based wage gap in the past several years. Washington women made 71.6 cents for every dollar made by Washington men in 2001-2002, down from 72.85 cents in 1999, according to the Institute for Women’s Policy Research.
What happened? Washington women’s earnings were stagnant between 1999 and 2002, while men’s earnings went up nearly 2 percent. This gives our home state the glorious distinction of being ranked near the bottom of the nation in terms of wage inequality: 42nd out of the 50 states and District of Columbia.
Does It Really Matter?
Is the wage gap really that significant? Do men really need to make more as “bread winners,” as many assume? These are the questions that disrupted my coffee respite, and they are important because many people wonder the same thing.
Putting aside issues of general fairness, the inherent assumption in my friend’s coffee confession is that most modern households consist of married couples with children where the man is the central wage earner. From there, it’s quite often assumed that if the woman works at all, her income isn’t primary, or sorely needed by the family unit.
But this assumption simply doesn’t play out in MOST modern households. Contemporary facts paint a different picture and show changing family and household dynamics. In 2003, only 23 percent of all American households consisted of married couples living with their children. Another 9 percent of all households consisted of a single-parent family. This means that a full 77 percent of households aren’t made up of married couples with children.
The Leave It to Beaver stereotype simply doesn’t fit. Times have changed. In fact, there were more one-person households in 2003 than households of married couples with children. And of those one-person households, a whopping 58 percent were women.
Amanda, 36, is single and an executive director of a nonprofit organization that runs a micro-enterprise program to assist low-income artisans building fine craft businesses. She shares her experience as the sole supporter of her own household: “I’m a single working woman, and I’ve been doing nonprofit work for a long time. The nonprofit wages are often set lower than the median family income, so I never really get ahead. I get the double whammy of the gender-based wage gap and the nonprofit discounted wages. Right now, any little extra costs, like a new laptop, for example, are a reach. In fact, for Christmas all my relatives pooled their gifts to purchase me a much-needed computer, which I adore. I definitely need to do retirement planning and am worried about the future, but immediate needs have taken precedence because of my chronic underpayment.”
Even for women in modern married-couple family situations, the main “bread winner” argument doesn’t always work. This is quite simply because most families need two parents in the labor force in order to stay economically viable.
One shouldn’t forget that many families who choose to have a stay-at-home parent take big economic hits. Contrary to popular belief that all stay-at-home parents are wealthy, families with a stay-at-home parent are about seven times more likely to live in poverty than those with two full-time working parents, according to a U.S. Census study.
I was talking to my neighbor, a stay-at-home mom, over the fence a few months back, and the discussion turned to the impacts of full-time parenting. Because her family chose to have a full-time parent, they haven’t taken many fancy vacations, they don’t have much saved for retirement, and they have given up a lot of material goods. “Being a stay-at-home parent creates a huge financial burden if one wage earner brings in a middle-class or lower income for a family,” she said.
In 2001, a full one-quarter of families with children under age six lived in poverty and earned less than $25,000 annually. At federal minimum wage, a two-parent family will earn only $21,424 a year with both parents working full-time – and this is in a country where childcare can cost anywhere from $4,000 to $10,000 a year per child. Don’t even bring up health- care costs and coverage. When you do the math, it’s easy to see why so many families live in poverty.
Not surprisingly, most mothers do work outside of the home. Between July 2001 and July 2002, almost three-quarters of mothers with children past one year of age were in the labor force, about the same number as women without children.
Jackie, 25, a social-issues survey respondent for my book, The F-Word, notes difficulties that are shared by many modern families: “I have two kids, a husband, a clear concept of my politics and a clear idea of where I want my career to go. However, I also have problems that many young women do not have. My family does not have health insurance. We do not own our own house. We are decidedly low-income. Childcare is a huge concern for us. Finding ways for both adults in the family to do work that is fulfilling for them, while also supporting a family, is a huge concern for us.” She reiterates: “Being parents in a society that does not support parents is a huge concern.”
Certainly not all families, or women, live in poverty. Some are doing quite well: 5.2 percent of all top earners at Fortune 500 companies are women. Success stories are out there, but 5 percent “does not, shall we say, represent” the full picture of women wage earners – particularly when compared to the fact that women now comprise 47 percent of the entire paid labor force.
Dollars and Sense
“My company compensates me less than half of what the man who had my job before me made. When I confronted my boss with the issue, he told me to take it or leave it. I’ve also noticed that when a man comes in to represent a territory for my company, they give all existing accounts to the man, but when a woman starts out in the territory, they do not give her the bigger existing accounts, and she is instructed to work to find new business,” says Roxanne, 28, who also responded to the social-issues survey for The F-Word.
Does this woman sound like she’s whining? Maybe it’s her fault that she isn’t making the same wages? Maybe she misunderstood the wages and structure of her job? Because gender inequality is often assumed to be an old issue long-solved, women are frequently portrayed as complaining, or even whining, when they note wage disparities.
Sad to say, gender inequality is far from a thing of the past. In November 2003, U.S. Representatives Carolyn Maloney (D-NY) and John Dingell (D-MI) released the results of Women’s Earnings, a General Accounting Office (GAO) report that demonstrated no improvement in the pay gap between men and women over the past two decades, despite a feeling of “continued progress toward gender equality in the workplace.” Feelings are great, but they don’t put food on the table.
Some people allege that the wage gap is influenced by women working fewer hours or by other “self-inflicted” factors. The GAO study controlled for outside variables such as education and work experience that could skew wage-gap calculations and still found a very significant gender wage gap.
The GAO study, which included 18 years of data on over 9,300 Americans and accounted for factors such as occupation, industry, race, marital status and job tenure in calculating comparable wages, concluded that a significant pay gap exists today. And while it points to a slightly smaller wage gap than the U.S. Census calculation, the GAO study still found that women made only 79 cents for every dollar paid to men.
When the GAO study factored out variables that may affect earnings, it found that women on average earned about 44 percent less than men between 1983 and 2000. In other words, if we put aside differences that affect earnings, such as education and employment interruptions, women actually earn far less than the calculated 79 percent of men’s wages.
The Invisible Inequality
It’s often difficult for individuals to see gender-based wage inequality. Generally, people don’t compare their paychecks at the water fountain, and questioning why one person makes more than another is far from common. In fact, Amy Caiazza,Ph.D., study director for the Institute for Women’s Policy Research notes, “Right now, in many instances, you can be fired for disclosing your salary. That means most people don’t know what their co-workers are making. It’s generally very difficult to know whether you are being discriminated against.”
Caiazza continues with a solution to the problem. “There is a bill on Capitol Hill that would protect people so they won’t be fired for talking about how much money they make. The bill also requires companies to analyze their salaries and wages and to disclose that data so potential patterns of discrimination can be seen. This is a very simple thing to do.”
Regardless of how the data is analyzed, it’s clear that over the past several decades, progress toward female-male wage parity has been slow – and it’s been slowest for women of color who face both gender- and race-based discrimination. According to The American Woman: 2003-2004, white women experienced a 32 percent increase in median annual earnings from 1975 to 2000, while African-American women gained only 22 percent and Hispanic women just 12 percent.
Societal trends are easier to see when large numbers of workers’ wages are considered at the same time. That’s when patterns show through the individual paychecks. In 2001, six current and former female Wal-Mart employees filed a national sex-discrimination class-action lawsuit, alleging widespread gender bias against women with regard to pay, job assignments and promotions. This lawsuit (Dukes v. Wal-Mart Stores, Inc.) is ongoing and active. Wal-Mart, the nation’s largest private employer, has more than 3,000 stores around the country, and as many as 1.6 million women have worked for Wal-Mart since 1998.
According to a statistical report prepared by the plaintiffs’ expert, Dr. Richard Drogin, “Women employees at Wal-Mart are concentrated in the lower paying jobs, are paid less than men in the same jobs and are less likely to advance to management positions than men. These gender patterns persist even though women have more seniority, have lower turnover rates, and have higher performance ratings in most jobs.”
Even more startling data emerged in a September 2003 oral argument by the plaintiffs’ attorney, Brad Seligman, when he sought to elevate the case to class-action status. The following is an excerpt:
Seligman, executive director of the Impact Fund and lead counsel against Wal-Mart, analyzes Wal-Mart’s response to the allegations: “Wal-Mart’s defense is really to argue that there are 3,600 separate Wal-Marts, and not one national corporation. Interestingly, they didn’t refute most of the evidence we put in, including stereotyping and bias at the top levels or Wal-Mart’s knowledge of the discriminatory impacts.”
Wal-Mart certainly doesn’t have a national policy directing employees to “promote only men and pay them better while you’re at it.” What we’re seeing instead is the result of thousands of independent and individual decisions, combining to reveal the sexism within our culture and corporate system.
Some might be saying, “Maybe the men were promoted because they were better managers at Wal-Mart?” In this case, it’s important to note that according to a meta-analysis study published in the American Psychological Association (APA) Psychological Bulletin in 2003, on average, women in management positions are somewhat better leaders than men in equivalent positions.
This study, together with the higher job-performance ratings for women at Wal-Mart, effectively negates the question of whether men – at 3,000 stores – were more heavily promoted because they all “just happened” to be better managers.
Where Does It Start?
Where does this relatively unconscious sexism start? Economists Gordon Dahl at the University of Rochester and Enrico Moretti at the University of California at Los Angeles decided to search for the roots of wage inequality in America, and surprisingly, they found them at birth. Dahl and Moretti reported in 2004 “we find that having girls (relative to having boys) increases the probability of divorce, decreases the probability of paternal custody, decreases the probability of marriage and shotgun marriage, and increases the probability of having another child.”
Dahl and Moretti’s research is part of a growing body of knowledge about birth preferences in the United States. University of Washington professor Shelly Lundberg and associate professor Elaina Rose have found that parents, particularly fathers, invest more in their families when they have boys. And this is a literal investment: an additional $600 per year is spent on housing – and fathers’ work hours and earnings are greater – with the birth of a boy rather than a girl.
The wage gap at Wal-Mart, and in America generally, is a product of the cumulative impacts of gender bias. Gender bias is particularly hard to eradicate when it starts at birth and continues through adulthood.
As women enter the workforce in increasing numbers, gender-biased ideas about what women “should” be doing still permeate and impact our culture. For example, Ms. magazine reported in fall 2003 that “[a] male supervisor [at Wal-Mart] explained lower pay for women by stating, ‘Men are here to make a career and women aren’t … housewives just need to earn extra money.’” Another comment reported in the Ms. article was that women “should be home with a bun in the oven.” Here we are back again at the “breadwinner” idea, a common misconception.
The Big Step: Motherhood
Yet, it’s with motherhood – a time when families need more economic support for basic needs, childcare and health care, not less support – that women take the biggest economic hit these days. Motherhood also offers some clues as to how the wage gap can be narrowed.
Hold on to your hats: The wage gap between mothers and non-mothers under age 35 is now greater than that between women and men, and it has actually widened since the 1980s.
Jane Waldfogel at Columbia University studied the issue and found that the pay gap between mothers and nonmothers expanded from 10 percent in 1980 to 17.5 percent in 1991. Waldfogel’s research focused on men and women with an average age of 30. She found that in 1980, mothers earned 56 percent of men’s salaries, while nonmothers earned 66 percent. But by 1991, nonmothers’ earnings had rocketed to 90.1 percent, while mothers earned only 72.6 percent.
A close look at the numbers shows the reason the wage gap is so large for all women is because the vast majority of American women are mothers. (In the year 2000, 82 percent of women had children by the time they were forty-four.) In other words, the majority of American women, mothers, are making less than the current average of 75.5 cents to a man’s dollar, and the wages of nonmothers are actually bringing up this overall average.
Waldfogel notes that the issue is more urgent for single mothers. They face a wage gap that has actually worsened relative to men and other women over the past few decades. “Single mothers now earn only 56-66 percent of what men earn, substantially less than women who are married mothers or not mothers at all,” according to Waldfogel.
Again, critics often allege that the women in these studies may have had less education or work experience, thus skewing the findings. However, the study filtered the data to account for education and work experience. The data further shows that men don’t take wage hits after having children. Something is really going on here.
And that “something” has a tremendous impact on poverty rates for women and families. Caiazza, from the Institute for Women’s Policy Research, notes, “We did a study that found [that] if there wasn’t a wage gap, the poverty rates for single moms would be cut in half, and the poverty rates for dual-earner families would be cut by about 25 percent.”
This brings us to the heart of the matter – and to some ideas for solutions. One reason for the widening American wage gap is that U.S. policy has “emphasized equal pay and equal opportunity policies, but not family policies such as maternity leave and childcare,” writes Waldfogel in the Journal of Economic Perspectives. Family policies such as paid family leave, as well as subsidized child and health care, have been shown to help close the gap in other countries.
So here we find a not-so-radical, and fairly short, to-do list for narrowing the American gender-based wage gap. And here again, after my fire hose of facts, data, and personal vignettes has run through, I find myself wondering about the coffee house punt. In order for much needed national policy changes to happen, true dialogue must also happen – not just in the polarized, national political spotlight, but also over coffee and in those all too rare, quiet moments between friends.
Note: Some portions of this article were taken from Kristin Rowe-Finkbeiner’s book, The F-word: Feminism in Jeopardy, Seal Press, 2004.
©2005 Caliope Publishing Company
©Seattle Woman Magazine | All Rights Reserved | 206-784-5556