Tag Archives: Claudia Goldin

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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Women’s Branding – Impact of Rebranding at Marriage, Divorce

Oscar Wilde

Oscar Wilde

Playwright, esthete, and bon vivant Oscar Wilde anticipated current attention to personal branding in his comment, “Names are everything.”

It is well-known that women who change their names at marriage are more difficult to find and connect to their pre-marriage professional accomplishments.
This is a “Brand Equity Risk,” and may result in reduced “personal brand value.

However, “rebranding” at marriage was prevalent among about 19,000 women who married in 2012, surveyed by TheKnot.com and www.WeddingChannel.com.
A significant majority – 86 percent – changed their birth names to their husband’s surname, with just 14% choosing another option such as:

  • Retaining their original name (<8%),
  • Hyphenating both partners’ last names (6%),
  • Creating a new surname, often from parts of each partner’s name.
Brian Powell

Brian Powell

Just three years before, Indiana University’s  Brian Powell and Laura Hamilton of University of California – Merced, found that that significantly fewer respondents – 71 percent of 815 survey participants – believed a woman should change her name at marriage, and half of those said it should be legally required.

Laura Hamilton

Laura Hamilton

This suggests that there is an increasing sentiment toward rebranding at marriage.

Richard Kopelman

Richard Kopelman

However, Baruch College’s Richard Kopelman, with  Rita Shea-Van Fossen of Ramapo College, Eletherios Paraskevas, Sacred Heart University’s Leanna Lawter, and David Prottas of Adelphi University, reported significantly decreasing incidence of women changing birth names at marriage from the 1990s to the 2000s. 

Claudia Goldin

Claudia Goldin

Likewise, Harvard’s  Claudia Goldin and Maria Shim, found a similar trend in their evaluation of  New York Times‘ marriage announcements, Massachusetts birth records, and Harvard alumni records: Fewer college-educated women kept their birth names in 2004 than in the 1970s and 1980s.

Maria Shim

Maria Shim

They noted that older brides and those who graduated from elite educational institutions were more likely to retain their original names, as were  those with occupations in arts, writing, and media.

Rita Shea-Van Fossen

Rita Shea-Van Fossen

Wayne State University’s Ernest Abel and Michael Kruger echoed Goldin and Shim’s finding that older brides are more likely to retain their original “brand.”

Ernest Abel

Ernest Abel

Women who married between ages 35 and 39 were six times more likely to keep their original names than women who married when they were 20 to 24 years old, reported Abel and Kruger in their analysis of 2575 wedding announcements in the New York Times.
They found that women who married in 2007–2008 were three times more likely to retain their birth names than those married in 1990–1991.

Stephanie Coontz

Stephanie Coontz

Diana Boxer

Diana Boxer

Stephanie Coontz of Evergreen College said that many of the women who changed their names in the 1970s did so as a counterpoint to marital inequality in obtaining credit, renting an apartment, and owning real property.
Other cross-cultural gender-specific identity practices were outlined by University of Florida’s Diana Boxer and Elena Gritsenko’s Women and surnames across cultures: reconstituting identity in marriage.

Education, age, religious affiliation, cultural traditions, and sentiment seem to over-ride typical advice for building a brand:  Repeated exposure to a consistent message over time.
Brand strategists who consider threats to corporate brand value could contribute to post-marriage rebranding decision-making by quantifying the potential long-term financial impact of women’s  nominal changes after marriage and marital dissolution.

-*What are the benefits to personal brand value of keeping or changing original names?

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Women’s Post-Business School Work-Life Issues

Claudia Goldin

Harvard Business School’s Claudia Goldin and Lawrence Katz showed the high price women pay if they choose careers in finance

Goldin and Katz’s survey of 6,500 Harvard and Radcliffe graduates from 1969 and 1992, found that women who had earned an M.B.A. were less likely to be employed and have children (30%) at their fifteenth class reunion than were female who earned M.D. degrees (45%).

Lawrence Katz

They concluded that female M.B.A.s with children select professions with shorter hours, compared to their male peers with children and childless peers of both genders.

The financial impact of this choice is significant: Goldin and Katz found that even after correcting for the amount of time out of work, female M.B.A.s who took a year and a half off made 41 percent less than their counterparts who had worked continuously.
The pay gap was somewhat less for J.D.s (29 percent) and M.D.s (16 percent).

Marianne Bertrand

Goldin and Katz collaborated with University of Chicago economist Marianne Bertrand on another survey of 2,500 male and female University of Chicago M.B.A.s graduating between 1990 and 2006, considered women M.B.A.s involvement in finance roles.

They found that only 8 percent of respondents working in venture capital were women, half the rate of women in investment banking.
In contrast, 59 percent worked in advertising and 71 percent held roles in human resources.

Again, this choice has a significant financial impact for women: Nine years after graduating, the Chicago M.B.A.s working in investment banking (both male and female) were making, on average, $700,000 a year (median was $470,000), compared to an average income for all respondents of $370,000 (median was $190,000).

Occupations with the highest numbers of men also had the highest average number of hours worked, with investment banking averaging 74 hours a week, and consulting averaging 61 hours per week.

In contrast, occupations with the highest numbers of women had the shortest hours: Human resources averaged 51 hours per week and advertising averaged 52 hours a week.
These occupations tend to have lower average pay in addition to requiring fewer average hours of work.

This trend was replicated in medical specialties, in which those with shorter and more predictable hours tend to have more females.
Women now make up 41 percent of new M.D.s in the U.S., but fewer than 30 percent of physicians under the age of 35 practice emergency medicine or general surgery, but 70 percent of gynecologists and nearly 60 percent of dermatologists in the same age cohort are women.

These studies demonstrate the relationship between income, hours worked, and gender-based occupational role choice.

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