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Are women really paid only 77 cents for each dollar men are paid?

Posted By Miranda Marquit On 10/14/2013 @ 2:30 pm In Career | 7 Comments

It’s fairly common to hear that women are only paid 77 cents for each dollar that men earn. While this number comes from the Census Bureau and is based on solid data, it’s important to understand that it doesn’t account for factors such as education and experience.

Indeed, when you start digging into the data a little bit, you find that there are a number of causes that influence the pay gap between men and women. And, while it’s definitely there, it might not be as big — or quite as sinister — as we think.

Why are women paid less than men?

In a paper [3] published a few years ago, Cornell University┬áprofessors Francine Blau and Lawrence Kahn, who’ve been studying and writing about this issue for more than two decades, broke down different factors influencing the difference between compensation for men and women.

The biggest reason for an overall gender pay gap (other than the “unexplained” catch-all, which was 41.1 percent) is occupational category. Women are more likely to be employed in lower-paying jobs, such as secretaries, teachers, paralegals, and work in the social sciences. Men, on the other hand, traditionally work in higher-paying fields [4], like engineering, math, science and technology.

Occupational category accounts for 27.4 percent of the gap, according to this research. Industry category, which is also related the types of chosen by women and men, accounts for 21.9 percent of the gap. When you think about a difference between what women and men are making, career field plays a huge role.

Other factors that influence the pay gap include union status (3.5 percent of the gap), since men are more likely to be a part of unions and receive wage protection, and race (2.4 percent of the gap). Labor force experience also accounts for a hefty chunk of the gap, at 10.5 percent. Speculation is that women are more likely to take time out of the workforce [5] to raise children or care for aging relatives. The fact that women are more likely to work part-time, or drop out of the workforce for years at a time, means that they see decreased earning power.

The researchers noted, however, that women have been closing the experience gap since the 1980s. And, by now, the education gap has been largely closed, since more women than men now earn degrees [6].

So what’s the result of all of these factors contributing to the gender gap? According to the study, once all of these factors are accounted for, the gender pay gap shrinks to the point that women earn 91 cents for every dollar that men make, when you actually consider women truly doing the same work, at the same level, as their male counterparts.

Even if Blau and Kahn are right, though, the fact remains that women still earn less than men — even when they do the same work. What do you think of this assertion? Do you think that the gender pay gap is closing?

(Photo: Flickr user daveynin)


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[1] Tweet: http://twitter.com/share

[2] Email: mailto:?subject=http://www.bargaineering.com/articles/gender-pay-gap-really-23-cents-dollar.html

[3] paper: http://www.stanford.edu/group/scspi/_media/pdf/key_issues/gender_research.pdf

[4] higher-paying fields: http://www.bargaineering.com/articles/how-to-get-the-best-bang-for-your-student-loan-buck.html

[5] take time out of the workforce: http://www.bargaineering.com/articles/optout-moms.html

[6] more women than men now earn degrees: http://www.nber.org/digest/jan07/w12139.html

Thank you for reading!