What is the truth behind the gender pay gap? There is without a doubt that there exists an overall difference in the money that men and women get compensated for the work they do. Anyone who denies this can do their own analysis of the numbers and see for themselves that there is indeed a gap in the overall numbers. The latest figures show that women make approximately seventy seven cents to every dollar that their male counter parts make.
These numbers are constantly bandied about as people continue to make the case for more legislation to address this issue of unequal pay that exists between the sexes.
It is a hot button issue that generates a lot of passion and emotion from the proponents of those who wish to see the issue addressed legislatively. They say that as a country we cannot simply leave it to chance and trust that the problem will correct itself. They argue further that in the twenty first century there is no reason that women who have proven they are just as capable of doing any job that men do in the workforce are still dealing with this issue of blatant inequality, and more than that; it is a stain and an embarrassment to us as the most advanced nation in the world.
Presidential Candidate Hillary Clinton alluded to the gender pay gap in one of her most recent stump speeches, she said “it still is an outrage that so many women are paid less than men”.
Study finds an undeniable gender pay gap in Glassdoor pay data, both in the U.S. and around the world.
Men earn more than women on average in every country we examined, both before and after adding statistical controls for personal characteristics, job title, company, industry and other factors designed to make an apples-to-apples comparison between workers. In the U.S., men earn on average 24.1 percent higher base pay than women in Glassdoor salaries. That amounts to women earning about 76 cents per dollar earned by men. However, once we compare workers with similar age, education and years of experience, that gap shrinks to 19.2 percent. Going further, when we compare workers with the same job title, employer and location, the U.S. gender pay gap is about 5.4 percent. This amounts to women earning about 94.6 cents per dollar earned by men. At today’s real median earnings for full-time working women of $39,621, that is a pay loss of $2,140 per year or more than $64,100 over a 30-year career. For those who earn more than median wage, they could be losing a lot more each year.
For example, if a woman earns $100,000 per year, she loses about $5,400 per year or more than $160,000 over the course of a 30-year career. Not only do women make less each year, but they start making lifetime earnings are much, much lower than their male counterparts’. According to Claudia Goldin, one of the leading economists studying the gender pay gap, “Women aren’t choosing to make less,” Instead, they’re buying the flexibility to handle responsibilities outside of work, said Goldin. Data she’s analyzed shows that lawyers and women with graduate business degrees start out relatively equal to men when it comes to pay, but the gap widens as women get older — when life and babies intrude on career goals. The same pattern persists for women with graduate-level business degrees.
As Goldin writes in a 2006 paper, “The Cost of Workplace Flexibility for High-Powered Professionals”, the penalty for M.B.A.s is higher than in any other profession she’s looked at. A high percentage leaves the highest paying jobs just after a few years. Some would look at this information and conclude that it’s a fair tradeoff, less work and more family; no big deal. Some jobs require everything, to be sure. But many, many jobs do not. In consulting, workers are rewarded for putting in 100-hour weeks with promotions and partnerships. The cultural requirements are so tedious, that one study found that male consultants simply pretended to work long hours. They were still rewarded with advancement. One lesson from that analysis: The men didn’t need to put in the work.