Obama’s 77-cent exaggeration
Ad makes false claims on women's earnings
A TV spot from the president’s re-election committee says women are “paid 77 cents on the dollar for doing the same work as men.” That’s not true. The ad falsely states that the pay gap is for doing “the same work.” It also implies that discrimination by employers is responsible for the difference. That’s an exaggeration.
The main point of the ad is to tout Obama’s signing of the Lilly Ledbetter Fair Pay Act in 2009. It was the first bill he signed into law, just nine days after he took office. The ad’s title is “First Law.” The legislation relaxed the statute of limitations governing when women could sue employers over alleged pay discrimination.
How wide a gap?
The ad cites the most recent annual Census Bureau findings on median annual income, released last September. And indeed, Census concluded that in 2010, “the earnings of women who worked full time, year-round were 77 percent of that for men working full time, year-round.”
But that’s the median (midpoint) for all women in all jobs, not for women doing “the same work” or even necessarily working the same number of hours. Furthermore, the raw gap for all women is not quite as large when looking at weekly earnings rather than yearly earnings.
Last year, looking at weekly earnings, the Labor Department put the figure at 81 cents on the dollar for 2010. It found that the median weekly earnings for women working full time at jobs paying a wage or salary was $669, compared with $824 for men. And although all these workers had normal work weeks of at least 35 hours (the minimum for “full time”), the Labor Department study noted that, for whatever reason, “men were more likely than women to have a longer workweek.”
And things have improved a bit for women since then. The median weekly figure was 82 cents for the first three months of this year, continuing a long trend to a narrower gender pay gap.
Breaking last year’s figures down by occupation, the Institute for Women’s Policy Research showed women doing the “same work” (that is, within the same occupational groupings) often make much more than 77 percent of their male counterparts’ median weekly earnings. The IWPR is affiliated with the graduate program in Public Policy and Women’s Studies at the George Washington University and says it seeks “to address the needs of women.”
The IWPR study found that “median earnings are lower than men’s in nearly all occupations.” But for the most part, the gap for “the same work” is not as wide as Obama’s figure suggests. Of the 36 different occupational categories in the study, in only seven were women paid 77 percent of the pay of men or less.
Female bookkeeping clerks and stock clerks actually made slightly more than their male counterparts, for example. Registered nurses made nearly 96 percent, elementary and middle school teachers made 91 percent, secondary school teachers made 94 percent, and police officers made 99 percent.
There’s wide variation, to be sure. Female chief executives still make only 69 percent, and female financial managers make just 66 percent, of their male counterparts’ earnings. And this study didn’t find enough female electricians, construction workers, grounds maintenance workers, carpenters or auto mechanics to make a valid comparison.
How much discrimination?
And however wide or narrow the gap, discrimination by employers isn’t responsible for all of it. In fact, a women’s pay specialist in Obama’s own Department of Labor — even as she was arguing that pay discrimination is not a “myth” — said research shows discrimination accounts for less than half of the raw pay gap.
Pamela Coukos, a senior program adviser at the Office of Federal Contract Compliance Programs, wrote in the Labor Department’s “official blog”:
Pamela Coukos, June 7, 2012: Economists generally attribute about 40% of the pay gap to discrimination – making about 60% explained by differences between workers or their jobs.
Similarly, an economist and a researcher at the Federal Reserve Bank of St. Louis said last year that the economic literature indicates the actual pay gap between men and women with similar characteristics is “much lower” than the raw gap. Despite the gains in recent decades, they wrote:
Natalia Kolesnikova and Yang Liu, October 2011: Men are more likely to be lawyers, doctors and business executives, while women are more likely to be teachers, nurses and office clerks. This gender occupational segregation might be a primary factor behind the wage gap.
Economists have identified a host of factors — other than discrimination by employers — that lead to lower earnings for women. These include such things as women choosing to work fewer overtime hours, choosing jobs that offer more “family friendly” fringe benefits in lieu of higher pay, and choosing to leave the workforce for years to rear children. Whether these choices are voluntary, or unfairly forced on women by society, is a good question. But they are not discrimination by employers.
How much of the gap is due to outright employer discrimination continues to be a subject of lively debate, which we won’t presume to settle here. Even a study prepared for the Bush administration’s Labor Department, and released the week before Obama took office, stopped short of concluding that discrimination isn’t holding down women’s pay at least somewhat.
That study, by CONSAD Research Corp., concluded that it wasn’t possible to say precisely how much of the raw pay gap is explained by factors other than discrimination. But it added:
CONSAD study, January 12, 2009: Nevertheless, it can confidently be concluded that, collectively, those factors [not due to discrimination by employers] account for a major portion and, possibly, almost all of the raw gender wage gap.
So whether factors other than discrimination account for 60 percent of the gap, as the Obama administration official states, or “almost” all of it, as the Bush-era study concluded, the research points to some remaining anti-female bias by employers.
But the president was flatly wrong to say that women are paid 77 percent of the pay of men for the “same work.” And the fact that women’s median annual earnings are 77 percent of men’s isn’t all or even mostly due to discrimination, as the ad implies.