That's an old advertising maxim, one that seems to be very much alive and well in the Obama White House when it comes to the myth that women earn on average .77 cents for every $1.00 that men earn.
In one sense, those folks in the Obama White House are correct. The Bureau of Labor Statistics (BLS) report, "Highlights of Women's Earnings in 2012," indicates that full-time wage and salaried female workers had median weekly earnings of $691, compared to male median earnings of $854. That's about 19% less, pretty close to the .77/$1.00 assertion.
However, research conducted by Andrew Biggs and Mark Perry indicates that those folks in the Obama White House have "cherry picked" data from the BLS report to perpetuate the myth. It all has to do with the comparison of "full-time" workers. That's faulty in that what qualifies as "full-time" varies. It's sort of like comparing apples to oranges. To wit:
- Men were nearly 200% more likely to work 40+ hours/week than women. Women were almost 200% more likely to work 35 to 39 hours/week. Yet, those differences were treated as differences.
- Were those folks in the Obama White House to take these data into account would shrinks the pay gap. How much? Women working 40+ hour weeks (not 35 to 39 hour weeks) earned 88% of male earnings.
Hmmmmm...something's just not right here.
Marriage and children make the comparison even more faulty. To wit:
- Mothers oftentimes leave the labor market to have children. When when they return, they have less work experience than men of their age. Less experience equals less pay.
- Working mothers generally seek more flexibility in their jobs than men. That flexibility equals less pays.
- But, in 2012, single, never-married women earned 96% of men's earnings.
Hmmmmm...something's really not right here.
Then, there's some other demographic facts making the comparison yet even more faulty. To wit:
- In college, women tend to major in fields in college that pay less in the labor market.
- Men are 400% more likely than women to negotiate their salaries in the job market.
- Men constitute the majority of the employees in the most dangerous jobs, such as logging. In 2012, for example, 92% of work-related deaths were male deaths. These risky, dangerous jobs pay high salaries in order to attract workers. Men tend to flock to these jobs.
- Men are also more likely to pursue occupations with risky compensation packages, such as finance. To compensate for the risk, the average pay in those jobs tends to be higher.
The "take away"? Those people in the Obama White House cherry picked BLS data in order to perpetuate a myth in hopes that people will believe it. Why? Could it be they want to pit the two genders against one another? "Gender politics" it's called.
Perry and Biggs argue that the data indicate that discrimination isn't producing the pay gap. They suggest examining labor market incentives to get a sense of how mythical the assertion really is. If it is true that women are paid 77 cents on the dollar, then any business looking to maximize its profits would cut its labor costs by replacing its male workers with female workers.
Why are businesses ignoring this opportunity?
Because it doesn't exist.
Let the discussion begin...
To read Perry and Biggs' article, click on the following link:
"The '77 Cents on the Dollar' Myth About Women's Pay."