"The Only Solution You'll Ever Need!"
We've become obsessed with magic bullets. You've seen the advertisements - products for miracle weight loss, body sprays that promise to attract scores of beautiful young women to men with questionable hygiene, and books for turning your brooding teenager into the model of open and direct communication in under one week...
The latest magic bullet on the scene is the reintroduced Paycheck Fairness Act. To mark last week's Equal Pay Day, Representative Rosa DeLauro and Senator Barbara Mikulski reintroduced the Act into the House and Senate, respectively. (You'll remember that the Paycheck Fairness Act died in the Senate last November...)
Supporters of the Act have argued that this piece of legislation has the power to end the gender pay gap - and gender pay discrimination - once and for all. Unfortunately, the Paycheck Fairness Act is destined to fail when it comes to delivering on this promise.
The problem with magic bullets is that they address the symptoms of the problem, but not the underlying causes. While the fresh-smelling body spray may mask the underlying problem of questionable hygiene, let's face it - you're not going to get the girl if you only bathe once a month. Magic bullets for weight loss might work in the short term (perhaps with some negative consequences for your overall health), but long-term weight management requires looking at diet and exercise.
The same is true for the gender pay gap. Most of the discussion on the gender pay gap focuses on a general statistic that says women earn 77 cents for every dollar men earn. This is a symptom that has been mis-measured and misinterpreted; the truth is, we don't fully understand the cause of the gender pay gap. Even the federal government has admitted that they don't fully understand the gender wage gap. One of the "persistent challenges" identified by President Obama's National Equal Pay Enforcement Task Force is the government's ability to understand the full scope of the wage gap and to identify and combat wage discrimination.
It's at this point of the Paycheck Fairness Act infomercial where the clever sales pitch comes in - the Act would enhance the collection of information on the wages of men and women in order to better understand the reasons for the gender wage gap.
AHA! The Act WILL work! More data = better understanding, right?
Nope. While the Act would give us a lot more data to look at, it will essentially be focusing on the same kinds of data we've been looking at all along - earnings by occupation, industry, etc. We already know that industry, occupation, work experience, race, education and union stats account for almost 60% of the gender pay gap. What we need to focus on are things we haven't yet looked at, but are likely to explain the remaining differential - things like hours worked, career interruptions, differences in compensation expectations, willingness to engage in salary negotiations, and what drives the choices people make about their employment and compensation. Right now, it doesn't look like the Act will collect any of these other pieces of information.
The truth is, magic bullets don't exist. There are no quick and easy solutions to problems that really matter. It takes critical thinking, some creativity and a lot of hard work to put together a long-term solution. There is no one-size-fits-all answer to what causes gender pay gaps. Legislation won't eliminate pay discrimination (if it would, the Equal Pay Act should have already taken care of the problem). The real question we need to asking about the Paycheck Fairness Act is whether or not it will really achieve what we think it will achieve. I have to question whether any solution can truly correct a problem that we don't fully understand...
Stephanie R. Thomas is an economic and statistical consultant specializing in EEO issues and employment litigation risk management. For more than a decade, she's been working with businesses and government agencies providing expert analysis. Stephanie has published several articles on examining compensation systems with respect to internal equity, and has appeared on NPR to discuss the gender wage gap. She is the host of The Proactive Employer, and is the founder of Thomas Econometrics. Follow her on Twitter at ProactiveStats.
Excellent post, Stephanie!
Thank you for staying on top of this issue which is so fraught with misinformation!
I find it terribly ironic that the government admits it does fully understand the numbers on gender equity, but yet are quite willing to enact legislation assuming there is a problem.
Posted by: Paul Weatherhead | 04/23/2011 at 08:54 AM
CORRECTION:
Excellent post, Stephanie!
Thank you for staying on top of this issue which is so fraught with misinformation!
I find it terribly ironic that the government admits it does NOT fully understand the numbers on gender equity, but yet are quite willing to enact legislation assuming there is a problem.
Posted by: Paul Weatherhead | 04/23/2011 at 08:56 AM