Please Mind The Gap!

No, I’m not posting about the London Underground on this occasion.

I am instead referring to the wage gap between men and women, which continues to make headline news.

Just the other day, the International Business Times reported that the U.S. Census Bureau found no progress had  been made to close the gender wage gap in the United States. It reported that womens’ wages have continued to hover at an average of 77 cents for every dollar earned by a man in an equal position, since 2005. This is despite Obama passing the Lily Ledbetter Fair Pay Act, shortly after taking office in 2009. Whilst the Lily Ledbetter Fair Pay Act may be relatively new in the US, legislation to ensure equal pay has been in place in the Britain for 40 years. Despite this long established legislation, the gender pay gap not only still exists in Britain, but the discrepancy remains among the highest in the EU.

In Britain the full-time gender pay gap between women and men is reported to be 14.9%.  The Fawcett Society report that the pay gap varies across different sectors and regions, rising to up to 55% in the finance sector, and 33.3% in the City of London, with 64% of the lowest paid workers being women. Progress in closing the gap has been slow, and now there are concerns that the wage gap may now widen, as the economy faces difficult times. The US has already seen the wage gap widen: the median income for women working with full-time jobs in 2011 was $37,118, compared to the median of $48,202 for men. In 2010, women averagely earned $38,052 compared with the average male earnings of $48,202.

The poverty rate for women is reported to be considerably higher, particularly among the elderly. The US Census Bureau reports 15.5% of women between the ages of 18 and 64 were living off less that $11,170 per year, meaning that 15.5% of women are officially living in poverty in the US. This is compared with just 11.8 percent of men. 10.7% of women over 65 were living in poverty last year, compared with 6.2% of men in the same age category.

Such a pay gap inevitably translates into a significant economic disadvantage for women in female-headed households, and especially in is the US where women are already reported to be less likely to have health insurance. In 2010, 20% of women between the ages of 18 and 64 are reported not to have had any form of health coverage, according to The Kaiser Family Foundation. Most did not qualify for Medicaid, and did not have access to employer-sponsored plans. This is all the more worrying when one considers that many female-headed households in the US, are thus also less likely to be able to provide health coverage for their children.

In Britain, nine out of ten single parents are women, yet the median gross weekly pay for male single parents is reportedly £346, while female single parents will averagely receive £194.4. Although Britain has the NHS to rely on for free healthcare, a number of single mothers are still, nevertheless, living poverty, and this inevitably effects their children.

There could be a number of factors influencing the wage gap. Feminist theory has speculated that the differences may be due to the discriminatory undervaluing of women, and “women’s work”, but I doubt this is the case. Even if struggling to find work, very few women will actually choose arduous manual labour over shop-keeping, nor will many women choose manufacturing work over a job in the nursing sector. How often will one see a woman laying bricks or operating a digger, rather than claim benefits or work part-time? Although more women may choose a career in engineering today than they may have in previous eras, it is still a case that relatively few women will actively *choose* such a career over the more traditional female dominated careers such as primary school teaching, nursing or secretarial roles, which are generally lower paid than more male-dominated careers in astronautics and space engineering.

A female JCB driver?

It seems unlikely that the reason behind the gender gap is largely due to sex discrimination, when it is actually the women themselves, who so often select the sector in which they choose to work in. That is not to say that sex discrimination is never a factor, of course, as both women and men could potentially be open to experiencing sex discrimination within the workplace. Indeed, there have been reports of an increase in employment tribunal cases where men have been subject to sex discrimination by their female colleagues. Sex discrimination is not exclusive to women.

There is also the factor of a lack of available flexible work opportunities, which means that single mothers who cannot afford childcare, can find it hard to reconcile paid work with family responsibilities. This might result in women working in part-time positions for fewer hours, or taking on a number of different temporary jobs. The so-called “motherhood penalty” could also arguably lead to discrimination in companies. There have previously been a number of employment tribunal cases revealing how employers have been less likely or refused to hire or promote women of childbearing age, for fear the female employees will prioritise pregnancy and childcare  over their commitments at work. One factor which may heighten the case for this argument is that lesbian women are reported to earn higher than their heterosexual counterparts.

According to the research the site pointed to, lesbians make about 6 percent more than heterosexual women when factors like race, education, profession, location and number of children are accounted for. There are other factors to take into consideration as to why the gap exists between heterosexual and homosexual women. One being that heterosexual women may expect their husbands or partners will earn more than they will. As a result, heterosexual women might choose to make career sacrifices, such as rounding a family, and thus choose to invest less effort in making themselves appear more indispensable to employers.

It may also be that employers and employees of either gender are unaware they may be either experiencing or perpetuating a gender pay gap, and so it remains unnoticed. Perhaps the mere knowledge that a male in a similar role at the same company is being paid more, might be enough to trigger a change. As a result the Fawcett Society has long proposed that businesses employing more than 250 people, should routinely audit, monitor, and publicise any pay gap between male and female employees. The 2010 Equality Act also included a clause, requiring companies to carry out gender pay audits if they failed to make enough voluntary progress. Unfortunately, the Section 78 clause was dropped by the coalition in 2010.

Whilst the Fawcett Society reported that the wage gap is even bigger in certain professions, such as financial management, a similar picture is mirrored in the findings of a recent study published in the Journal of the American Medical Association. The study conducted at University of Michigan in Ann Arbor, found that male doctors reported making an average of slightly over $200,000 per year, whilst women earned about $168,000. However, the study researchers found women were more likely to work in lower-paying specialties such as paediatrics and family medicine. Female doctors also tended to work slightly fewer hours – an average of 58 hours per week, compared to mens’ average of 63 hours. Although such differences were responsible for some of the salary gap, Dr. Reshma Jagsi, the lead author of the new study, found that despite factors due to career and life choices, women still made about $12,000 less than men doing the same type and amount of work.

The finding of the study does not reveal the underlying driving force between the salary differences between men and women. In this instance, perhaps female doctors accepted slightly lower pay in return for less time being on-call to spend time with families.

One significant explanation is that women are less aggressive about negotiating for pay. Indeed, a report by Shuchita Kapur in Emirates 24/7  reveals how experts believe the gender gap to be a result of female unwillingness to negotiate.

The article points to the suggestion that companies will generally present every employee with a low starting offer, and it is usually up to the individual to negotiate any salaries rises. Professor Horacio Falcao who specialises in Negotiation at INSTEAD has suggested that men are much more likely to negotiate pay than women: “Research actually indicates that in many countries around the world, women are more likely to accept the first salary offered than men. This usually results in men entering the company with a higher pay than women and then making more money in the future as raises tend to be percentage increases relative to the base pay.”

The opinion of Grainne Fitzsimons, Associate Professor of Management at Fuqua School of Business, also coincides with Falcao’s, and stated that: “Research suggests that women are less likely to negotiate salary, because women feel uncomfortable in that role and worry about the impression they will make if they ask for more money. In fact, research suggests that this unwillingness to negotiate is extremely costly for women, and leads them to be underpaid in a number of domains,” she told Emirates 24/7.

A research study by Carnegie Mellon University in the US, revealed that while 51.5% of men negotiated their initial offers, only 12% of women did.

So, ladies; perhaps the moral of the story (at least in part) is: If you don’t ask; you don’t get.

More to the point, whilst a job providing the benefits of full-time pay with flexible hours, may be ideal for working mothers, the truth is, we cannot have it all. Nor should any of us expect it. Salaries should be based upon merit, hours of work, and dedication. Until modern medicine discovers a method in which men can give birth and become mothers, women cannot realistically expect the salary statistics to match those of men.

Given the subject of ” Please Mind The Gap”, I decided to include this rather wonderful photo of Hannah Dadds, who made history by becoming the first ever London Underground Tube driver, in 1969. Story can be found here.

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4 thoughts on “Please Mind The Gap!

  1. Dark Puss says:

    I think there is some evidence that before applying for promotion women are likely to wait until they fulfill all of the criteria for the job where as men are more likely to go for it if they satisfy the main criteria.

  2. Dark Puss says:

    I thought this article from the Centre for Creative Leadership was interesting: http://uwww.ccl.org/leadership/pdf/research/ManagerialPromotion.pdf

  3. lookatmyemailaddress says:

    The problem with the wage gap as it is discussed in most of the media is that it’s a leap of faith: Difference does not imply discrimination. Taking into account as many influencing factors as possible, leaves is a so called “unexplained wage gap” which lies somewhere below 10% depending on the population. But “unexplained” does not mean “caused by discrimination” which is how it’s typically interpreted.
    For all we know, discrimination is preventing the wage gap from being even greater. Meaning, discrimination could be working more in women’s favor and removing it might widen the wage gap.

    What we do know is that men and women are physiologically different and this affects our behavior and the choices we make in life which will inevitably affect the outcome in statistics comparing men and women. We just don’t know how much is explained by that but the safest assumption is that it accounts for most if not all of the “unexplained” wage gap.

    In any case, any kind of affirmative action will not only fail to fix the cause, but will add new ones. Large groups of the population like “all men” are always going to include many minorities that deviate from the standard and they will be treated even more unfairly than the average member of either group under affirmative action. Example: Some men are as shy and sensitive as any woman which already works to their disadvantage when everything is fair. Implementing affirmative action will make things even worse as they are legally treated as the “confident gender”.

    For reasons like that, it’s never good to try to forcefully redistribute prosperity based on broad sweeping generalizations such as affirmative action. It’s impossible to do that without making it more unfair for people who are in a too small minority to have a lobby and therefore no way of getting political representation (unlike the women’s lobby). It creates a system in which the bigger stronger groups get more privileges because of more lobby action. That’s precisely why female quote exist in their current form: the women’s lobby is very influential and the men’s lobby is not.
    If it really was about equality, then there would also be male quota for veterinary medicine for example.

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