Admitting the gender pay-gap is narrowing
Proponents of more government regulation in the workplace are launching a new effort under such euphemistic labels as Paycheck Fairness, Fair Pay, and Equal Pay. Congress and state legislatures are being urged to adopt the concept of "comparable worth" and use it in setting pay scales.
The case for comparable worth is based on a striking but misleading statistical comparison: On average, women, are paid less than men. Women's median annual earnings were 74 percent of men's in 1997. It's tempting to conclude this is due almost entirely to discrimination. Numerous factors come into play in the determination of wages and salaries - and they aren't always the same for men and women. For example, on average, women have less work experience because they're more likely to leave their jobs in connection with childbirth and child rearing. And women have tended to favor occupations that minimize overtime and allow flexible work hours (often related to caring for children). Until recently, women tended to have less education than men.
However, in recent years public policy and private actions have reduced if not removed workplace barriers to women. We'd thus expect to find the pay differential between men and women becoming narrower in younger groups. This is what every study shows. In the youngest working groups, the pay gap has almost disappeared, especially for men and women of comparable education and experience. So women aged 16 to 29 typically earn 92 percent of men's earnings. Women aged 27 to 33 who have no children now earn on average, 98 percent of the wages of childless men of the same age.
When we look at specific work, women have made substantial progress, especially in fields requiring higher education. More women now receive college degrees than men. In 1970, 39 percent of psychologists were women; by 1998, it was 62 percent. In law, the women's share increased from 5 percent to 29 percent; in public relations, from 27 percent to 66 percent.
Women now start businesses at twice the rate of men. The number of women-owned businesses more than doubled between 1987 and 1997.
Yet, all this hasn't prevented advocates of more regulation from pushing legislation designed to eliminate the 26 percent wage "gap." The comparable worth approach attempts to do so by a process that determines the inherent "worth" or "social value" of a job, with no reference to the marketplace. "Comparable worth" turns out to be a very subjective notion. For example, when the neighboring states of Iowa and Minnesota attempted the task, Iowa ranked a secretary above a laundry worker, while Minnesota ranked the laundry worker higher. Minnesota rated a "data entry operator" higher than the other two jobs, and Iowa rated the data entry operator lower than the other two. Other states show comparable anomalies.
The adverse effects of the "comparable worth" approach can be seen where it has been used most extensively - the public schools. In the typical case, a school district pays teachers with a given amount of seniority and education the same regardless of subject taught. After all, is a math instructor more "worthy" than a history teacher? The result: surpluses of gym teachers, shortages of science teachers.
Advocates of "Paycheck Fairness" should be reminded of the obvious: Pay discrimination because of a person's sex is illegal. Moreover, the progress that has been made in the workplace makes another round of government regulation quite unnecessary.
*Murray Weidenbaum is chairman of the Center for the Study of American Business at Washington University in St. Louis.
(c) Copyright 1999. The Christian Science Publishing Society