« How to Determine Equity Grant Sizes (it’s probably not what you think) | Main | In the Beginning . . . »



Feed You can follow this conversation by subscribing to the comment feed for this post.

A 9% pay gap sounds right to me. The gender pay differential for ACA members (WorldAtWork used to be the American Compensation Association) back in 1981 when Howard Risher, PhD, took all those variables into account was 14.3%. That research and more was cited in my "pro" Comparable Worth article in the July 2010 Workspan. Today, college women have out-graduated men and we have experienced a feminization of the professional work force, so a lot more women have entered those highly paid "male" jobs. All else held equal, women earning 9% less than the male full dollar makes sense.

Not much has changed since I first posted that comment back in 2010, except that Howard has become an occasional guest contributor here. It is still an accurate, timely and important article!

But Jim, if that were the case, a smart profit-oriented employer would hire an all female workforce (of presumptively equal capability) and enjoy the competitive advantage of 9% lower labor costs.

That this just doesn't happen has always struck me as the most convincing refutation of gender-based pay discrimination.

This is certainly not to say that there isn't an earnings gap, but that's a different discussion.

One cartoon parody of the older ratios that ran from 60% to 70% joked, "Don't hire a man, hire two women!" I believe those who think that way are some of the ones who actually drive female pay lower when they do indeed follow the temptation to low-ball women with rates that would insult a man. Haven't you seen that happen, Tony?

I have never seen women low balled on salaries. Actually, I have seen the opposite---a conscious effort to pay women the same to avoid any claims of discrimination.

What is the title of the 2007 study by Blau and Kahn referenced above? Couldn't find it. Thanks.

I believe this is it -

More or less dittos to Ross. I have never seen a lowball offer to a female candidate merely because of her gender. I have seen budget-constrained lowball offers made to (and rejected by) candidates regardless of gender.

I also have seen women (and men, for that matter) promoted into "stretch" situations for which they are paid less than a (fully qualified and experienced) external hire would be. And, as we all know, an external hire of any gender will typically require a risk premium for changing employers.

Thanks for sending the reference to the article quoted, Ann. Generally speaking, I believe that it is dangerous to cite one study to substantiate a major idea in human resources, such as the one proposed here...the gender pay gap is really just $.09 per hour.

Other research studies are necessary in my opinion to confirm or refute this finding, as I have found that when different methods, samples, and time periods are used, the results of research studies can vary substantially.

I would be most convinced by a study involving an in-depth examination of personnel records and interviews with HR professionals who did the hiring in a random sample of organizations of all types.

Hi Ross - Thanks for your comments. Blau and Kahn have done a number of different studies using Census and Bureau of Labor Statistics data, and their results are consistent time and time again, and are also consistent with what other researchers looking at the same questions are finding / have found.

Looking at the detailed HRIS records for a sample of organizations would be an interesting project! I suspect that when one controlled for organization, the estimated differential would be smaller, since we would be nearly eliminating the industry differential, and and occupational differences may (or may not) be smaller. Differences in the cash-benefits tradeoff, flexible scheduling, etc., would also likely be reduced since we would expect the same employer to offer the same kinds of benefits to all employees irrespective of gender.

I agree with Ross and Tony in that observed wage differentials by gender in the workplace are not necessarily attributable to discrimination, and that the 9 cent differential is likely explained by a variety of other factors (hours worked, cash/benefits tradeoffs, skills/abilities/qualifications, "stretch" versus "non-stretch" assignments, etc.)

From my perspective, it's dangerous to perpetuate the "77 cents" statistic that aggregates everyone by gender and ignores real differences between individuals that are meaningful to the compensation choices organizations make.

In their latest research (2016 report), Kahn and Blau concluded this about the wage gap:

A decrease in the unexplained gap over the 1980s contributed to the robust convergence in the gender wage gap over that decade, with the unexplained gap falling sharply from 21-29% in 1980 to 8-18% by 1989. However, the unexplained gap did not fall further subsequently, remaining in this range over the succeeding 20 years.


A bit more from the 2016 report that continues from the above quote and appears important:

We also found that both the raw and the
unexplained gender pay gap declined much more slowly at the top of the wage distribution that at the middle or the bottom. By 2010, the raw and unexplained female shortfalls in wages, which had been fairly similar across the wage distribution in 1980, were larger for the highly skilled than for others, suggesting that developments in the labor market for executives and highly skilled workers especially favored men.

The comments to this entry are closed.