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June 05, 2012

Pay No Attention to that Annoying Man with the Calculator!

“Women still earn just 70 cents for every dollar a man earns. It's worse for African American women and Latinas.”
— President Obama, Remarks on Equal Pay for Equal Work, June 4, 2011 (The White House later corrected the president’s statement to 77 cents.)

“Women earn only 77 cents for every dollar men earn, with women of color at an even greater disadvantage with 64 cents on the dollar for African American women and 56 cents for Hispanic women.”
— White House Statement of Administration Policy on Paycheck Fairness Act, June 4


The WaPo calls Obama for using misleading statistics and apples to oranges comparisons to hide the fact that the playing field is a lot more level than is good for grievance politics:

The 77 cent figure comes from a Census Bureau report, which is based on annual wages. The BLS numbers draw on data that are based on weekly wages. Annual wages is a broader measure — it can include bonuses, retirement pensions, investment income and the like — but it also means that school teachers, who may not work over the summer, would end up with a lower annual wage.

In other words, since women in general work fewer hours than men in a year, the statistics may be less reliable for examining the key focus of the legislation — wage discrimination. Weekly wages is more of an apples-to-apples comparison, but as mentioned, it does not include as many income categories.

The gap is even smaller when you look at hourly wages — it is 86 cents vs. 100 (see Table 9) — but then not every wage earner is paid on an hourly basis, so that statistic excludes salaried workers. But, under this metric for people with a college degree, there is virtually no pay gap at all.
This brings us to our larger point: Broad comparisons are inherently problematic. As the BLS points out: “Users should note that the comparisons of earnings in this report are on a broad level and do not control for many factors that may be significant in explaining earnings differences.”

Indeed, economists at the Federal Reserve Bank of St. Louis surveyed economic literature and concluded that “research suggests that the actual gender wage gap (when female workers are compared with male workers who have similar characteristics) is much lower than the raw wage gap.” They cited one survey, prepared for the Labor Department, which concluded that when such differences are accounted for, much of the hourly wage gap dwindled, to about 5 cents on the dollar.

Not only did the White House pick the statistic that makes the wage gap look the worst, but then officials further tweaked the numbers to make the situation for African Americans and Hispanics look even more dire.

The BLS, for instance, says the pay gap is relatively small for black and Hispanic women (94 cents and 91 cents, respectively) but the numbers used by the White House compare their wages against the wages of white men. Black and Hispanic men generally earn less than white men, so the White House comparison makes the pay gap even larger, even though the factors for that gap between minority women and white men may have little to do with gender.

Another day, another victim. Will we womenfolk ever see economic justice?

Posted by Cassandra at June 5, 2012 08:45 AM

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Comments

The compensation schemes at my law firm were pretty transparent. I never would have stood for any pay disparity between me and my male colleagues.

Posted by: Texan99 at June 5, 2012 09:56 AM

That hasn't ever been the case anywhere I worked.

In fact, at most jobs I've held we were expressly forbidden to talk about compensation/reveal what we made. Interesting tactic - can't say it does much for morale :p

I know for a fact that at one job a male co-worker who was less qualified and a marginal performer was getting paid way more than I was because my boss actually told me he was getting paid more b/c he was a man.

[thud]

It got even weirder. He was single, ten years older than I, and living rent free with his parents.

I was married with a child and my husband was in school and also worked part time.

Still, I can't honestly say I've ever spent much time worrying about whether men in my workplace were paid more than I was. The important question to me was always, "Am I getting paid what I deserve, based on my experience and contributions?"

I don't even know how one performs such calculations unless one works somewhere with many people with the same job description and even there I would think there would be intangibles that would be difficult to measure for or isolate and tie to increased/decreased compensation. Using averages (especially of un-normalized numbers) seems awfully simplistic to me.

Posted by: Cass at June 5, 2012 10:09 AM

MAN HATING FEMINAZI!!!

lol

My office used to try the "if you discuss your salary, that's a fire-able offense." Until someone pointed out that you cannot prevent employees from discussing salaries under Georgia labor laws (and for this very reason). The funny thing happened when one of my (male) co-workers was asked by a (female) co-worker how much he made, since she was sure there would be a gender based difference. There was. Just not in the direction she had assumed. She never told him what she made other than, "a lot more than that."

Posted by: MikeD at June 5, 2012 11:06 AM

The funny thing happened when one of my (male) co-workers was asked by a (female) co-worker how much he made, since she was sure there would be a gender based difference. There was. Just not in the direction she had assumed. She never told him what she made other than, "a lot more than that."

*snort* :)

FWIW, I have found that years when I do a better job of tooting my own horn, I get a far bigger bonus. I used to sort of assume my company knew what I was doing but that's really not a good assumption. I was suffering in silence, for which I really blame only myself.

You need to list it for them and remind them, and that's something that many women (me included) feel very uncomfortable about doing.

Now that I'm managing people, I make sure updating that list is part of the review process and at the end of the year I pass a one pager on to the folks with the huge pulsing brains who determine bonuses. The other thing I like about this is that it makes it easier for them to track their workload over time and keep their resumes current (not that I want them to leave, mind you!).

Posted by: Cass at June 5, 2012 11:20 AM

Before ruining my life by becoming a lawyer, I was for many years a productive member of the private sector. Although I’m told that the practice of paying employees in pelts, shiny rocks and clams has (apparently) gone out of style, I believe that the same management principles that I once learned at Og, Org, Ally & Oop., Ltd., still apply. Namely, management will not pay any employee more than the absolute minimum it can get away with without losing the employee to a competitor. That's how you get to be a manager.

Now here’s what I noticed as a manager of untold millions of humans: All other things being equal between a female and male employee ding the same job, the guy is about 10 times more likely to get paid more than the gal because he is also ten times more likely to ask his boss for a raise.
Of course, the guy is also ten times more likely to get turned down for a raise, but he's improved his chances immensely. Just saying.

Posted by: spd rdr at June 5, 2012 12:20 PM

There is a gender gap of serious proportions in my house. My wife makes a ton more money than me, even though I have all 5 of Cisco's baby certs, and she's got one. But she has actual experience doing that stuff, and I have actual experience laughing all the way to the bank and back.

It got even weirder. He was single, ten years older than I, and living rent free with his parents.

I was married with a child and my husband was in school and also worked part time.

Sounds reasonable to me. He could be relied on to report for work promptly every day, and he was approaching retirement. You, on the other hand, had a working husband and could be relied upon to call in sick every time you got the vapors or the little rascal scraped a knee....

[diving for cover]

Eric Hines

Posted by: E Hines at June 5, 2012 12:20 PM

My office used to try the "if you discuss your salary, that's a fire-able offense." Until someone pointed out that you cannot prevent employees from discussing salaries under Georgia labor laws (and for this very reason).

This creates a different problem though. As managers cannot talk about the salaries of their direct reports except to that direct report.

You as a manager cannot respond to an employee complaining to you of gender discrimination that not only is she the highest paid person in her job grade, but the highest paid person in the next job grade is *also* a woman.

That did not end well for anyone.

I am of the firm opinion that no good ever comes from openly discussing your pay with coworkers.

Posted by: Yu-Ain Gonnano at June 5, 2012 12:27 PM

here’s what I noticed as a manager of untold millions of humans: All other things being equal between a female and male employee ding the same job, the guy is about 10 times more likely to get paid more than the gal because he is also ten times more likely to ask his boss for a raise.
Of course, the guy is also ten times more likely to get turned down for a raise, but he's improved his chances immensely. Just saying.

Well, maybe just 8 times more likely to get turned down :p

Seriously, I've read studies that show the same thing. Doesn't surprise me at all.

I read a study a while back about women, math skills, grades, and teacher perceptions of their ability level.

Even when the study controlled for test scores, females rated their own math ability/competence far lower than males with the same grades. That doesn't surprise me.

What did, more than a bit, was that instructors also rated female students at the same level of performance to be "in over their head". That is kind of depressing, as it implies that even when teachers have an objective performance measure like test scores to work with, they rate female students who get the same test scores lower than male students.

I'm not surprised females assess their own skills more harshly. A whole slew of studies have consistently shown that guys overestimate their competence, knowledge, and even attractiveness to women. It just goes to show you that what I told my boys was true:

Most people really aren't paying attention to anything that doesn't directly impact them. Thus, they are more than happy to take you at whatever value you place on yourself. So if you're overconfident, you'll usually be thought of as more competent than you are and the reverse is true as well.

Interestingly, studies of male leaders show the same phenom: a signal characteristic of male CEOs is that they are markedly more optimistic about their chances of success than the general public. What fascinates me about this is that this doesn't actually result in better than average success rates :p

Confidence, even if it is utterly unsupported by fact, matters in leaders. That's a human trait - it just happens to impact women more than it does men. But it absolutely impacts men as well!

Posted by: Cass at June 5, 2012 01:22 PM

I am of the firm opinion that no good ever comes from openly discussing your pay with coworkers.

Oh, I totally agree. The same applies to discussing test grades in college. In most of my classes, I got the highest test grades about 95% of the time. This was truly more a function of the number of hours I put in as an adult student and probably maturity (I was usually also the oldest student in the class - so much for smarts!).

I never revealed my grades to anyone who asked, but some of the more annoying profs would post the grade distribution on the board and then, when someone asked who got the highest grade, would either look right at me or tell the class outright.

And you're right - no good came of it.

Posted by: Cass at June 5, 2012 01:26 PM

Oh, and Eric....

WHAP WHAP WHAP WHAP WHAP!!!! :)

Posted by: Cass at June 5, 2012 01:27 PM

This is why I love the consulting business.
Performance Review: the check shows up after I send an invoice in.
Salary: whatever they're willing to pay, and I'm willing to take.
Benefits: whatever I pay for.

Posted by: Allen at June 5, 2012 02:16 PM

The grades at my college were pretty transparent, too, in addition to which it was hard to miss whether someone made cum laude or Phi Beta Kappa. GPAs were universally known at my law school as well.

I never discussed the specifics of my salary outside my firm, but within my firm the base salaries were fixed by year of hire, while the merit-based bonuses were on a standard scale and published. When I became a partner, every partner naturally knew how many "points" every other partner had. Anyone not on the high end of the scale knew he was receiving a not-very-subtle hint that he should be thinking about a move. What's more, the national law magazines had a pretty accurate grasp of what everyone was making at the major firms and published it a couple of times a year. Lateral transfers were common, and salary negotiations were efficient. There was a lot of insecurity and uncertainty, but never about the payscale.

Salary negotiations aren't about fairness, they're about leverage. The way to get leverage is to work for people who want you to stay, and to make it clear to them that you're ready, willing, and able to leave if you can't strike a mutually acceptable deal.

Posted by: Texan99 at June 5, 2012 02:22 PM

Salary negotiations aren't about fairness...make it clear to them that you're ready, willing, and able to leave if you can't strike a mutually acceptable deal.

You--you--capitalist!

Eric Hines

Posted by: E Hines at June 5, 2012 02:50 PM

OT: The Venusian transit has begun.

Eric Hines

Posted by: E Hines at June 5, 2012 06:58 PM

"I am of the firm opinion that no good ever comes from openly discussing your pay with coworkers."

My parents taught me that asking these questions:
How much money do you make?
How old are you?
How did you vote?
were not only strictly verboten, but would result in not only getting the "Look" from both parents but also a stern lecture once I was sequestered away from any potential witnesses.

Posted by: DL Sly at June 6, 2012 08:53 AM

My parents taught me that asking these questions:
How much money do you make?
How old are you?
How did you vote?

And yet my parents often asked me, "Just who do you think you are!?"

Eric Hines

Posted by: E Hines at June 6, 2012 12:48 PM

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