The gender wage gap not based on discrimination
Published: Thursday, May 24, 2012
Updated: Tuesday, July 24, 2012 20:07
“Women make less than money than men.” Do they really?
The media will often claim women make less than men, in general, and for equal work. Too bad this doesn’t make sense from a business standpoint.
First, women and men have different tastes. More often than not, men prefer to go into the STEM majors — science, technology, engineering and math. Women on the other hand prefer to enter education and liberal arts. These different majors lead to different careers, and these different careers pay different salaries. STEM jobs generally have higher salaries than do the arts careers.
Right off the bat, some women are choosing to enter lower paying fields due to preferences. There is nothing wrong with this — some people like certain classes and subjects just like certain people prefer black cars or red cars.
But these differences in tastes and majors yield differences in salaries between fields; therefore, comparing all women to all men in terms of pay is a bad indicator of equal pay.
Do all women prefer the arts over the STEMs? Of course not. On the flip side, not all men prefer the STEMs over the arts. And the same applies to these people. Career path plays a huge role in salary.
Second, it doesn’t make sense from a business perspective to pay women less for equal work. Most of us agree that we live in a pretty capitalistic country (disregarding the thousands of laws and regulations we do have that cripple business). We would also agree that the goal of a business is to make as much money as possible, at the lowest cost, in order to maximize profit. The claim that women, or any other group that claims “wage discrimination,” make less money does not hold water in business.
If women could perform equal work in every aspect as a male counterpart, why would a business pay a man more money? It makes no sense.
If the business had any interest in staying in operation, and it’s safe to assume that that’s true, the business would fire any man that is producing just as much output as any woman that is doing it for less pay.
An economist at a university in California created the following scenario: Company A hires 500 white male workers at $5 per hour, while Company B hires 500 black male workers (again, any group that claims wage discrimination can be inserted) at $4.75 per hour. Over one year, Company B will save $250,000.
A quarter of a million dollars is a lot of money that a business can use. It allows the business to allocate the money toward lowering costs, hiring more workers to increase production, advertising more and a plethora of other options to help the business survive.
It makes absolutely no business sense to pay a woman less money, contingent upon her producing the same output as a man. Now, in no way are women less competent than men; therefore, any woman can earn as much as a man. But in order to earn as much, if not more, she must have similar qualifications.
Qualifications for jobs and careers include work experience, education, connections and many others. The most crucial is likely the work experience.
The main place where women lose out on work experience is when bearing children. Women miss work to have the child and care for it after. All this is completely justified. However, in the choice to have a child, and take time off work, work experience is diminished and can hurt pay.
Because of this, we have laws that mandate maternity leave pay. This hurts women even more, making it more expensive to hire women. An employer must pay a woman on maternity leave even though she produces no output at her job.
Moreover, businesses don’t slow down production and are forced to either make everyone else pick up the slack or hire someone temporarily. Both of these options make it more expensive for a business to operate.
Regardless of what we may see and hear, the wage gap makes no sense from a business perspective. Businesses are pretty smart, otherwise they wouldn’t continue their operations.
The reasons for receiving lower pay than a coworker range far and wide, but discrimination is not one of them.
Drew Pells is a junior in business administration. The opinions expressed in his columns do not necessarily represent those of The Daily Barometer staff. Pells can be reached at firstname.lastname@example.org.