News Intro Text
[Economic Policy Institute, October 20, 2016]
Date
News Item Content
<p>Report • By Elise Gould, Jessica Schieder, and Kathleen Geier • October 20, 2016</p>
<div>
Working women are paid less than working men. A large body of research accounts for, diagnoses, and investigates this “gender pay gap.” But this literature often becomes unwieldy for lay readers, and because pay gaps are political topics, ideological agendas often seep quickly into discussions.</div>
<div>
</div>
<div>
This primer examines the evidence surrounding the gender pay gap, both in the literature and through our own data analyses. We will begin by explaining the different ways the gap is measured, and then go deeper into the data using hourly wages for our analyses,1 culling from extensive national and regional surveys of wages, educational attainment, and occupational employment.</div>
<div>
</div>
<div>
Summary</div>
<div>
Why different measures don’t mean the data are unreliable</div>
<div>
</div>
<div>
A number of figures are commonly used to describe the gender wage gap. One often-cited statistic comes from the Census Bureau, which looks at annual pay of full-time workers. By that measure, women are paid 80 cents for every dollar men are paid. Another measure looks at hourly pay and does not exclude part-time workers. It finds that, relative to men, typical women are paid 83 cents on the dollar.2 Other, less-cited measures show different gaps because they examine the gap at different parts of the wage distribution, or for different demographic subgroups, or are adjusted for factors such as education level and occupation.</div>
<div>
</div>
<div>
The presence of alternative ways to measure the gap can create a misconception that data on the gender wage gap are unreliable. However, the data on the gender wage gap are remarkably clear and (unfortunately) consistent about the scale of the gap. In simple terms, no matter how you measure it, there is a gap. And, different gaps answer different questions. By discussing the data and the rationale behind these seemingly contradictory measures of the wage gap, we hope to improve the discourse around the gender wage gap.</div>
<div>
</div>
<div>
Why adjusted measures can’t gauge the full effects of discrimination</div>
<div>
</div>
<div>
The most common analytical mistake people make when discussing the gender wage gap is to assume that as long as it is measured “correctly,” it will tell us precisely how much gender-based discrimination affects what women are paid.</div>
<div>
</div>
<div>
Specifically, some people note that the commonly cited measures of the gender wage gap do not control for workers’ demographic characteristics (such measures are often labeled unadjusted). They speculate that the “unadjusted” gender wage gap could simply be reflecting other influences, such as levels of education, labor market experiences, and occupations. And because gender wage gaps that are “adjusted” for workers’ characteristics (through multivariate regression) are often smaller than unadjusted measures, people commonly infer that gender discrimination is a smaller problem in the American economy than thought.</div>
<div>
</div>
<div>
However, the adjusted gender wage gap really only narrows the analysis to the potential role of gender discrimination along one dimension: to differential pay for equivalent work. But this simple adjustment misses all of the potential differences in opportunities for men and women that affect and constrain the choices they make before they ever bargain with an employer over a wage. While multivariate regression can be used to distill the role of discrimination in the narrowest sense, it cannot capture how discrimination affects differences in opportunity.</div>
<div>
</div>
<div>
In short, one should have a very precise question that he or she hopes to answer using the data on the wage differences between men and women workers. We hope to provide this careful thinking in the questions we address in this primer.</div>
<div>
</div>
<div>
<a href="http://www.epi.org/publication/what-is-the-gender-pay-gap-and-is-it-real/">FULL REPORT AND MORE>>></a></div>
<div>
Working women are paid less than working men. A large body of research accounts for, diagnoses, and investigates this “gender pay gap.” But this literature often becomes unwieldy for lay readers, and because pay gaps are political topics, ideological agendas often seep quickly into discussions.</div>
<div>
</div>
<div>
This primer examines the evidence surrounding the gender pay gap, both in the literature and through our own data analyses. We will begin by explaining the different ways the gap is measured, and then go deeper into the data using hourly wages for our analyses,1 culling from extensive national and regional surveys of wages, educational attainment, and occupational employment.</div>
<div>
</div>
<div>
Summary</div>
<div>
Why different measures don’t mean the data are unreliable</div>
<div>
</div>
<div>
A number of figures are commonly used to describe the gender wage gap. One often-cited statistic comes from the Census Bureau, which looks at annual pay of full-time workers. By that measure, women are paid 80 cents for every dollar men are paid. Another measure looks at hourly pay and does not exclude part-time workers. It finds that, relative to men, typical women are paid 83 cents on the dollar.2 Other, less-cited measures show different gaps because they examine the gap at different parts of the wage distribution, or for different demographic subgroups, or are adjusted for factors such as education level and occupation.</div>
<div>
</div>
<div>
The presence of alternative ways to measure the gap can create a misconception that data on the gender wage gap are unreliable. However, the data on the gender wage gap are remarkably clear and (unfortunately) consistent about the scale of the gap. In simple terms, no matter how you measure it, there is a gap. And, different gaps answer different questions. By discussing the data and the rationale behind these seemingly contradictory measures of the wage gap, we hope to improve the discourse around the gender wage gap.</div>
<div>
</div>
<div>
Why adjusted measures can’t gauge the full effects of discrimination</div>
<div>
</div>
<div>
The most common analytical mistake people make when discussing the gender wage gap is to assume that as long as it is measured “correctly,” it will tell us precisely how much gender-based discrimination affects what women are paid.</div>
<div>
</div>
<div>
Specifically, some people note that the commonly cited measures of the gender wage gap do not control for workers’ demographic characteristics (such measures are often labeled unadjusted). They speculate that the “unadjusted” gender wage gap could simply be reflecting other influences, such as levels of education, labor market experiences, and occupations. And because gender wage gaps that are “adjusted” for workers’ characteristics (through multivariate regression) are often smaller than unadjusted measures, people commonly infer that gender discrimination is a smaller problem in the American economy than thought.</div>
<div>
</div>
<div>
However, the adjusted gender wage gap really only narrows the analysis to the potential role of gender discrimination along one dimension: to differential pay for equivalent work. But this simple adjustment misses all of the potential differences in opportunities for men and women that affect and constrain the choices they make before they ever bargain with an employer over a wage. While multivariate regression can be used to distill the role of discrimination in the narrowest sense, it cannot capture how discrimination affects differences in opportunity.</div>
<div>
</div>
<div>
In short, one should have a very precise question that he or she hopes to answer using the data on the wage differences between men and women workers. We hope to provide this careful thinking in the questions we address in this primer.</div>
<div>
</div>
<div>
<a href="http://www.epi.org/publication/what-is-the-gender-pay-gap-and-is-it-real/">FULL REPORT AND MORE>>></a></div>