Why Women Make Less Money

Why Women Make Less Money?

Equality has been the theme of the new America throughout the second half of the twentieth century and beyond. In today’s America, women can do every single thing a man can. According to the National Center for Education Statistics, more women enroll in 4 year universities then men yet for every dollar that a man makes, a women makes only seventy nine cents ceteris paribus (“Digest of Education Statistics: 2007” Table 179). Although this income gap between man and women has narrowed drastically from 59 cents in 1970 to 80 cents in 2004, the gap is still unexplained (Farrell, xix). This is the question most supporters of equality for women, and women themselves, for that matter, ask time and again. Understanding the root causes of this segregation might help us undo the mystery and probably give insights to young college-going women, with what they could do to not be just another victim of this bias and pose a genuine threat for men, when it comes to job hunting. Being a Professional Search Recruiter for 70% of the Fortune 500 companies, I have, first hand, seen this bias in practice in jobs throughout the spectrum. From a Staff Accountant to a Chief Financial Officer, this divide definitely does exist. My personal experience could be just that, but the fact that only 12 Women CEO’s exists in the Fortune 500 companies of 2006, is a universally accepted phenomena (“Women CEOs”). Logically speaking, if the fact that women make less money for the same job, in the same geographical area and all the other variables remain same, why would anyone hire a man to do the work? Would it not be more profitable for companies to hire women and keep the savings as profit? Or is it that the world is full of chauvinist pigs that deny equal opportunity to women? Well the answer to it is more complex then it seems and in some way is more intertwined with our original question “Why women make less money?”

Clearly the easiest baseless argument would be that of discrimination. Men feel insecure by a woman who is better than them in terms of professional achievements and therefore they do not choose to give equal opportunity to the opposite sex. In reality though, men at the executive level, do not see themselves intimidated by women who are successful. These men are rather in search of successful women. These executives hire women in the hopes that they would become successful under their leadership. There is more kudos to a successful team comprised of women team members, led by a male executive then a team of all men. Therefore the decision of not hiring women is motivated by confrontation with an equally successful woman is absurd. Besides most Executives in this capitalist society only care for profitability of the employee. Any other factor is almost negligible. To further prove my point, switch on the TV on a lazy Sunday and browse through all network channels and you will notice that there is heavy sales promotion for cars done by women.

Then there is age old folklore of men holding women back, or for that matter a women boss holding a hierarchical inferior back causing women to make less money than men. However, what happens when a women is self employed or does not have any boss to “hold them back”. In 2004, women who owned their businesses made only 49 cents to every dollar that an entrepreneurial man made (Farell, xxii). As a matter of fact, in today’s world external factors are more conducive for women to own a business then for men. Aerospace companies like Boeing, Northrop Grumman, and Raytheon among others, give preference to minority and women owned businesses, when it comes to spreading out the headhunting contracts for recruiting people on their behalf. This could be attributed to what Dr. Warren Buffet in his book “Why Men Earn More” calls “the high pay formula” and the “low pay formula” where men sacrifice the quality of their personal lifestyle in exchange of the former whereas women are less willing to commit to the same trade off, thus settling for the latter (Farrell, xxi).

Having considered two of the most commonly yet brutally false reasons used to explain the pay segregation, by ignorant yet opinionated people, could there be a possibility that there is a rift in publishing these startling statistics that point towards the gender that earn less for the same job? In his early feminist book “The Future of Marriage” by J. Bernard, he cites a study conducted by the Census Bureau that reflects that even during the pre feminist era as 1950 there was a mere 2% pay gap between unmarried women and men. But what was more stumping was that the single women between the ages of 45 to 54 earned 106% of their single male counterparts. This was before Affirmative Action first used in 1961 and the Equal Pay Act of 1963. It could be possible that the unequal pay is a mere controversy and nothing else.

Having taken into consideration, most scenarios’ that may explain the wage discrimination, or question its existence, there are at least two solid reasons that do explain the “wage discrimination”. Call it misfortune or destiny, but studies show that the most productive years for an employee in his or her career are between the ages of 25 to 45 – overlapping the child bearing years for women. More women at least until 2004 chose the latter than the former. It is a known trend that more women look for careers that are more fulfilling, safe and flexible. Demanding careers like Medical Doctors, Pharmacists, University Teachers, Engineers, CPA’s require at least 8 years of education post high school coupled with a few years of demeaning internship with miniscule pay. Fate also has it, that these careers that pay the most and collide with the child bearing age of 25 – 35 years for women. Therefore most women chose careers that are less demanding and more satisfying while giving them room for bearing a family. This can be further proven by equaling the playing field and taking into consideration Dr. Farrell’s “20 Lowest Paying Jobs” that do not require a considerable amount of education. Positions like Counter Attendants in Retail, Cafeteria or McDonald’s et al. have the least wage discrimination for men and for women alike. Men made a measly $14,872 while women made a pitiful $14,092; with the difference being 5.25%, yet this profession has 64% women. “Wage Discrimination” for Cashiers is 7% with women dominating the industry at 75%. The same stands true for Housekeeping where the difference is at 12% and women represent 78% of the industry (Farrell, xxxi). There is such minimal segregation in wage because these positions are ultra flexible. Women can take extended leaves from the industry to bear a family and comeback with the same or a little higher inflation adjusted pay rate. These unskilled positions are not known to buy performance related salary raises and bonuses and therefore while the women may take a break, she could still command the same salary as men who did not take breaks during the same period.

Women also tend to pick jobs that are safer for several reasons. The most important being, she considers herself as the most important ingredient in the growth of her children. For non child bearing women, it is socially unacceptable to be a Lumberjack or alike. After all how many “Lumberjill” women attract men. The ‘Prisoner’s Dilemma’ for men is to get the love of the family by separating himself from the love of the family. Men also cannot complain about the quality of the job because men are born with numbers around them. They grow up with the average steals per ball game; average points per basketball game etc. so in their minds, they will do whatever it takes to bring in the dough. Besides the manlier the job, the more he can convince himself of his manliness. After all how many of us remember the news coverage that one farmer got because of the responses he got for posting a singles AD on Craigslist! Women desire men that are … men. Some of the male dominated professions like Stationary Engineer (98%), Sheet Metal Worker (96%), Carpenter (99%), Boilermaker (100%) etc. are careers that may not require a lot of education, but are certainly more life threatening than an Administrative Assistant or HR Generalist (Farrell, xxxii).

Thus from ignorant assumptions to incomplete studies to valid statistics, there are several reasons that prove the existence of the wage gap. However there is something that women can do to minimize this on a personal level. In the early 20th century, women bore family at age 20 through 25 because the average life expectancy for a man was less than 50. Today the average life expectancy for men is 78 years and for women is over 80 years, with the child bearing age all the way up to 35. If women could put themselves through the rigors of education beyond a Bachelor’s degree post age 23 they would place themselves in a very strategic position right next to that of a man, earning a dollar for a dollar on the one hand and giving men a run for their money on the other. However in the grand scheme of things, statistics may show a more bias towards men, when it comes to paying the “man” for the job, there are exceptions to every rule and what separates women who make more than men and thus become exception to the rule, is their drive and desire to make more than men. Their commitment to success is much stronger than that of normal women who tend to succumb to peer/social pressure more often than not. Success, they say, is a choice.

Works Cited

Farrell, Warren. Foreward. Why Men Earn More: the Startling Truth Behind the Pay Gap – and What Women do about it (New York, New York: AMACOM, 2005. i-xxxii)

Berkowitz, Robert, What Men Won't Tell You But Women Need to Know (New York: Morrow,
1990)

Chaykowski, Richard P., and Lisa M. Powell, ed., Women and Work (Ontario, Canada: McGill-Queen's University Press, 1999)

Cose, Ellis, A Man's World (New York: Harper Collins, 1995)

Bureau of Labor Statistics. National employment and wage data for the 10 largest occupations by industry from the Occupational Employment Statistics Survey, May 2004.
(Washington, 2004)

United States. U.S Department of Education. Institute of Education Sciences. Total fall enrollment in degree granting institutions. Table 179. Washington: GPO 2007.

“Women CEOs”. Fortune. 5 May. 2005: 26-27