The myth of the gender wage gap

This is one of those “facts” that has been hammered into our heads for so long that it’s passed into the common knowledge. The sad state of affairs is that women just earn less money than men for doing the same jobs. On average, they are paid 77 cents on the dollar compared to their male counterparts. You already knew that, right? The problem is that it’s apparently a completely bogus statistic. There’s a good article on this at The Daily Beast this week, (no… seriously. The Daily Beast) titled, No, Women Don’t Make Less Money Than Men which explains it.

President Obama repeated the spurious gender wage gap statistic in his State of the Union address. “Today,” he said, “women make up about half our workforce. But they still make 77 cents for every dollar a man earns. That is wrong, and in 2014, it’s an embarrassment.”

What is wrong and embarrassing is the President of the United States reciting a massively discredited factoid. The 23-cent gender pay gap is simply the difference between the average earnings of all men and women working full-time. It does not account for differences in occupations, positions, education, job tenure, or hours worked per week. When all these relevant factors are taken into consideration, the wage gap narrows to about five cents. And no one knows if the five cents is a result of discrimination or some other subtle, hard-to-measure difference between male and female workers. In its fact-checking column on the State of the Union, the Washington Post included the president’s mention of the wage gap in its list of dubious claims. “There is clearly a wage gap, but differences in the life choices of men and women… make it difficult to make simple comparisons.”

Reading through the numbers on this, it becomes clear that old school math doesn’t explain it all away and the reasons for what we see happening are complicated. If you take the total amount of money earned by women in the United States and stack it up against the totals earned by men, then yes… women average 77 cents to the male dollar. But why? The great irony here is that the explanation can be boiled down to one simple word; choice. The academic degree you pursue and the profession you enter will have a huge impact on how much money you make. And while women are now enrolling in and graduating from university degree programs at an even faster pace than the boys, they’re simply not going into the fields where the most money is earned.

In nine of the ten highest paying college major programs (which include Petroleum, Aerospace, Chemical and Electrical engineering) the majority – and mostly very substantial majorities – of the students enrolling are guys. Conversely, female students dominate the ten least profitable majors, such as Early Childhood Education, Human Services and Community Organization or Communication Disorders Sciences and Services.

The real question is, once the students – both male and female – arrive at work with their degree in hand, are employers paying the ladies 23 cents per hour less for the same entry level job? The answer appears to be no. They might be averaging a nickel less, but that’s nearly within the margin of error. This isn’t to say that there aren’t still some individual employers out there who are pulling misogynistic tactics like that, and they should be exposed for doing so. But by and large, it looks like the playing field is considerably more level than we’ve been led to believe. The key to solving this puzzle and getting rid of some of that 23 cent gap isn’t getting more girls into college. It’s good career counseling to help them select better paying fields.

Of course, that won’t wipe it all out. Other choices, such as tough decisions about being stay at home moms and other lifestyle choices will still drive down the average lifetime pay of women, but that’s an entirely different discussion.