Why the Gender Wage Gap Persists

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By Rachael Andrews

Why does the gender wage gap persist despite numerous different pieces of legislation that sought to close it? The American Association for University Women recently released the Spring 2017 report on the gender pay gap in the United States, and the report doesn’t stop at the simple statistic that women make 80% of what men do; instead, the report breaks down the pay gap by age, race, sexual orientation, gender identity, and education level.

Apparently, the rate of closing the gap has slowed since 2001, and if it continues at that rate, women will not reach pay equity until 2152. That is, of course, the median earnings of women compared to the median earnings of men. When broken down by race, that reality is much bleaker. In the graph below, we can see that the median earnings of white women compared to men are much greater than those of women of different races and ethnicities. Asian women make slightly more than white women and the gap is slightly narrower. However, white women do have the largest gap compared to white men, with white women making 76% of what a white man makes. Hispanic/Latina women have the smallest gap with those women making 92% of what a Hispanic/Latino man makes, despite the median earnings being much lower than that of whites.

The AAUW details some solutions for policymakers – and individuals and corporations as well – to help close the wage gap. The report asserts that “The Paycheck Fairness Act would improve the scope of the Equal Pay Act, which hasn’t been updated since 1963, with stronger incentives for employers to follow the law, enhance federal enforcement efforts, and prohibit retaliation against workers asking about wage practices.”

The Paycheck Fairness Act would expand upon the Equal Pay Act of 1963 and the Fair Labor Standards Act of 1938 to put the “justification burden on employers as to why someone is paid less and allows workers to sue for punitive damages of wage discrimination,” along with instituting programs to train women to better negotiate for increased wages.

So, why does the gender pay gap persist if there are already laws on the books to prevent it? Why does the AAUW believe we need another act to address it? It all depends on who you ask.

Source: Pittsburgh Post-Gazette
Source: Pittsburgh Post-Gazette

After former President Obama passed the Lily Ledbetter Fair Pay Act of 2009, many were quick to analyze its effects on the pay gap. As evidenced by the recent AAUW report, it did not do much. Some would say that the wage gap persists because women are more likely to take time off work for child care, or that women are more likely to take lower paying job, a situation known as occupational segregation. However, the women’s research group, Catalyst, controlled for those variables in a longitudinal study of MBA graduates. The study found that even when women had no children, the pay gap persisted, which Ilene Lang, the head researcher, contributed to age-old stereotypes. Basically, the stereotype is the assumption that all women will eventually leave the workforce to care for children, while their husbands will continue to work. Obviously, that just isn’t true.

Returning to the original legislation, the Equal Pay Act only contends that it is illegal to pay employees different or lesser wages for equal or very similar work. Indeed, “equal pay for equal work” is the simplified mantra of the Equal Pay Act. However, cases that successfully appeal to the Equal Pay Act are pretty rare, especially in higher level positions where courts generally require the plaintiff to identify a particular employee who has a similar title and is being paid more. Finding a close enough comparison in white-collar jobs is more difficult than in blue-collar jobs. The Act also does not address the underlying gender assumptions that may justify the disparities in wage discrimination; specifically, wage discrimination would need to be brought under Title VII of the Civil Rights Act. Title VII is a part of the Civil Rights Act of 1963 that prohibits employers from discriminating against employees on the basis of sex, race, color, national origin, or religion. Lily Ledbetter (Ledbetter v. Goodyear) was brought under Title VII, but the Supreme Court ruled that there was a statute of limitations as to the time frame that the case could be brought within. They ruled it had to be brought within 180 or 300 days from the initial pay decision. Obviously, many women may not even realize they are being paid less within that time frame, leading to the Lily Ledbetter Act.

Despite these pieces of legislation, the wage gap is not going away because the fact is that no one explanation or factor explains the wage gap fully. In some cases, it could be that women do take more time off work for child care. Interestingly, it is important to address why women, and not men, are taking time off for child care and what can be done to ease that particular burden. It could also be job segregation, and, if so, why are “pink-collar” jobs – those occupations that are generally dominated by women – valued less within the market? Or, women may work in lower-paying jobs, part-time jobs, or jobs with little to no benefits. Again, it is important for future policies to investigate these issues. Loopholes in current legislation and the burden of proof on the plaintiff, coupled with underlying discrimination could also account for the wage gap.

Future policymakers should consider different steps to close this gap. The underlying reasons for job segregation, child care responsibilities, legal loopholes, and discrimination are all insidious factors that continue to contribute to this issue and are consistently left out of serious policy discussions. The persistent wage gap is not explained by a singular, simple explanation. It is subversive and complicated and it is not going away on its own.

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