The gender wage gap is one of the largest pieces of misinformation that our society perpetuates. When controlled for education, experience, job choice and hours worked, the pay gap between men and women almost completely disappears. Even though countless studies have been conducted on the matter, popular figureheads, like President Barack Obama, keep rehashing the statistic that women make 77 cents for every man’s dollar.
Although that statistic is true, the context is disgustingly misleading. It only looks at raw data, which means the statistic compares the salary of all women to all men without control variables. That’s like trying to compare a Wal-Mart cashier’s salary, which is around $10 per hour, to the Wal-Mart CEO’s salary, who makes around $25 million per year. You can’t compare apples or oranges, bananas to grapefruit, and preschool teachers to petroleum engineers.
In a study commissioned by the United States Department of Labor in January of 2009, with control variables such as occupation, hours worked, number of jobs, and full-time employment accounted for, the gap thins to about 93-95 cents per man’s dollar.
As well, a study by the American Association of University Women (AAUW) found that when comparing men to women with the aforementioned controls from the U.S. Department of Labor study, in addition to undergraduate major and GPA, they found there was about a 7% pay gap between men and women.
On page 34 of the AAUW study, the researchers concluded, “Among recent graduates who made the same education and career choices, women still earned just 93% of what men earned, leaving a 7% unexplained pay gap."
Even though the pay gap is much smaller than what the majority of people make it out to be, there is still a gap. There is the possibility of gender discrimination taking a part in this gap. However, with legislation like the 1963 Equal Pay Act, the 1972 Education Amendments Act, the 2009 Fair Pay Act and the Paycheck Fairness Act of 2014, how can companies afford to discriminate against gender in today’s society?
One popularly theorized reason for this gap falls behind studies stating women are far less likely to negotiate for pay compared to men. In a study conducted by the Stockholm School of Economics in 2012, they found that men were almost twice as likely to negotiate pay compared to women.
On page 10 of the study, the researchers concluded, “28.1 percent of the female participants initiated a negotiation, compared to 42.5 percent of the male participants. The gender difference of 14 percentage points is statistically significant. We thus conclude that male participants are 1.5 times more likely than female participants to initiate a negotiation.”
In another study conducted by Carnegie Mellon University in 2007, researchers found when payment was explicitly stated to be negotiable between the volunteers and the researchers, men were 25% more likely to negotiate their pay compared to women. In the study, 83% of men compared to 58% of women negotiated pay.
That same study also found in another experiment that people who negotiated their pay received on average 7.4% more compared to those who did not negotiate.
Although that percentage can fill the unexplained gap between men and women noted in the AAUW study, explaining the gap with it is far too easy. Although I am a huge proponent of Occam’s razor, which is the belief that the simplest answer is more often than not the correct one, this is a complex topic that needs to be further studied with the controlled statistic, rather than the raw data Obama likes to reference.
