Price of Job “Flexibility” for Women: Lower Salaries

Claudia Goldin

Claudia Goldin

Women in professions noted for their schedule and location “flexibility” are shortchanged with smaller paychecks than men in equivalent roles, according to Harvard’s Claudia Goldin.
She analyzed higher-paying occupations, and validated the frequently-cited finding that women earn an average of 71 percent of men’s wages after controlling for age, race, hours and education.

In addition, Goldin found significant differences related to flexibility in work schedule or location or ability of colleagues to substitute for each other.
For example, women financial specialists earned 66 percent of men’s pay in the same field, but women pharmacists earned 91 percent of their male colleagues’ salaries.  Goldin-Womens salaries as percentage of mens

Comparable salaries were reported for male and female tax preparers, ad sales agents and human resources specialists, attributable to workers’ ability to substitute for each other.
Among medical professions, obstetricians and “hospitalists” have introduced “interchangeability” with trusted colleagues.

This difference is explained by higher pay for roles that require longer hours, physical presence for “office face time,” and 24×7 availability, known as “non-linear” occupations.

In these fields, like law and investment banking, women typically work fewer hours and earn less than men:  A lawyer who works 80 hours a week at a large corporate law firm earns more than double one who works 40 hours a week as an in-house counsel at a smaller business.

Francine Blau

Francine Blau

In contrast, women and men in “linear” occupations such as pharmacists, computer hardware engineers, and computer software engineers, report similar number of hours worked and earn equivalent incomes:  A pharmacist who works 40 hours a week generally earns double the salary of a pharmacist who works 20 hours a week, and as a result, the pay gap for pharmacists is one of the smallest.

Lawrence Kahn

Lawrence Kahn

The U.S. reports relatively larger gender-based pay gap than other advanced countries, found Cornell’s Francine Blau and Lawrence M. Kahn, and they attributed this wage disparity to “the very high level of U.S. wage inequality.

Uri Gneezy

Uri Gneezy

Another explanation for this discrepancy was that men in competitive environments improve their performance, but when women’s performance remains about the same as in non-competitive situations with they challenge men, reported University of California San Diego’s Uri Gneezy, Muriel Niederle of Stanford and Aldo Rustichini of University of Minnesota.

Muriel Niederle

Muriel Niederle

In contrast, women’s performance increased when they competed with women, suggesting that women are willing and able to compete, but may not experience the enhancing effect of the workplace “tournament.”  

Aldo Rustichini

Aldo Rustichini

This gender difference in competitive environments may explain women’s under-representation in Science, Technology, Engineering, and Mathematics (STEM) academic programs and job roles.
Supporting this hypothesis is the finding that competition and lack of mentor and peer support are linked to women’s voluntary exit from engineering programs, according to Goodman Research Group’s Irene F. Goodman with Christine M. Cunningham and Cathy Lachapelle of Boston Museum of Science.

Irene Goodman

Irene Goodman

These organizational climate factors have been tied to decreased feelings of competence, confidence, and optimism, reported University of North Carolina’s Beril Ülkü-Steiner and Beth Kurtz-Costes, with C. Ryan Kinlaw of Marist College, and these can undermine women’s work performance.

 Beth Kurz-Costes

Beth Kurz-Costes

Wage parity is more likely for those who optimize performance during cross-gender competition and select roles with a high degree of “interchangeability” and “linearity” between hours worked and salaries.

C Ryan Kinlaw

C Ryan Kinlaw

Another solution for those who prefer to earn more than average for their occupation is to work longer hours and more continuously throughout their careers.

-*How can women increase performance with competing with men?

-*What occupations have a “linear” relationship between hours worked and compensation?

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