Working for 60 cents on the dollar?

Posted: May 23, 2002 12:00 AM
In the 1980s, the issue of "comparable worth" was the subject of widespread commentary. It was often said that women earned just 60 cents for every dollar men earned, the implication being that sexual discrimination and nothing else was the cause of this gross inequity. Even many conservatives acknowledged that women should receive equal pay for equal work. Among the many problems with this analysis is that the data used for it were very imprecise. Moreover, at the point at which the issue became a hot topic, the labor force -- especially as it affected women -- was undergoing massive change due to cultural and societal factors. As a consequence, details about how particular women in certain occupations at particular income levels and in specific age brackets were blurred or ignored in the many articles discussing comparable worth. The most generally cited data are from the Census Bureau, which annually calculates the ratio of female to male earnings. These data are for full-time, year-round workers. This ratio hit bottom for women in 1973 at 56.6 percent. By the time the issue became hot in 1980, the ratio had already risen sharply to 60.2 percent. Since these data were released in 1981, the implication was often made that somehow Ronald Reagan's policies were responsible for the disparity. Those blaming Reagan for short-changing women seldom noted that the female-to-male earnings ratio rose to 66 percent by his last year in office. It continued to rise throughout the administrations of George W. Bush and Bill Clinton, although it fell in Clinton's last two years from 74.2 percent in 1997 to 72.2 percent in 1999. I don't recall any feminists blaming Clinton for the relapse, as they certainly would have done if a Republican occupied the White House. In any case, the policies of any president have almost nothing to do with the earnings of men relative to women in any individual year or even several years. The really important factors explaining this ratio have to do with long-term factors such as how many women have college educations relative to men, how many women work and how many work full-time versus part-time, and such things as how many women choose to marry and have children in comparison to their mothers. The mid-1970s were a pivotal period for significant changes in these critical factors. The labor force participation rate for women shot up from 43.3 percent in 1970 to 51.5 percent in 1980. It has continued to rise almost continuously to 60.1 percent in 2001. Meanwhile, the labor force participation rate for men fell from 79.7 percent in 1970 to 77.4 percent in 1980 and 74.4 percent in 2001. The flood of women into the labor force was bound to depress women's wages, all other things being equal. This was especially the case since many of those seeking work lacked college educations and had been out of the labor force, due to child-rearing, for some time. Also, many women actively sought work with flexible hours, such as nursing, that tended to drive down wages in such occupations, since demand was relatively fixed. However, these were all short-term phenomena. As time has gone by, young women entering the labor force for the first time have found a profoundly different environment than their mothers faced. According to an article in the March issue of the Monthly Labor Review, young women today are far more educated than their mothers. Thirty percent of women ages 25 to 34 now have four years of college education, compared with just 18 percent in 1975. Young women are also working more hours and are less likely to be married or have children than their counterparts 25 years ago. The percentage of such women working full-time rose from 74.3 percent in 1975 to 80.3 percent in 1999, and those working more than 50 hours a week rose from 45.5 percent to 62.9 percent. In 1975, just 11 percent of women ages 25 to 34 had never been married. By 1999, that figure almost tripled to 30 percent. The percentage of women with children in this age bracket fell from 76 percent to 60 percent over the same period. In short, women were becoming more like men as far as employers were concerned. As a consequence, their employment status and earnings have risen. The percentage of women working in high-paying executive positions increased from 9.2 percent in 1983 to 15.5 percent in 2000, while those working in low-paying clerical positions fell from 30.2 percent to 22.6 percent. This has led to an increase in earnings relative to men from 67 percent in 1979 to 82 percent in 2000 for young women. New Internal Revenue Service data confirm the growing equality of the sexes in terms of income. They indicate that many women now earn more than their male counterparts. As higher-earning younger women displace lower-earning older women, this trend is likely to continue.