GAO: Women Paid Less Than Men

The pay gap comes as a Congressional study finds women generally work less, leave the labor force for longer periods and tend to hold jobs that pay less at the beginning. Taking away these factors, though, the pay gap widens to a 44% chasm, according to data supplied by the General Accounting Office (GAO).

To arrive at this number, the GAO used thePanel Study of Income Dynamics, a nationally representative longitudinal data set that includes a variety of demographic, family, and work-related characteristics, and analyzed data from the period 1983 to 2000. After the original gap was identified (44%), the GAO then employed a statistical model to identify the factors that contribute to this wage disparity.

Key to this gap the GAO found was work pattern. Specifically:

• women have fewer years of work experience
• women work fewer hours per year
• women are less likely to work a full-time schedule
• women leave the labor force for longer periods of time.

As evidence, the GAO reports men work on average 2,147 hours per year, compared with 1,675 for women. In addition, men on average have been in the workforce 16 years, compared with 12 years for women. Similarly, the GAO found 80% of the men in the workforce are full time (compared with 67% of women) and women are out of the workforce an average of three weeks per year to the average man’s one.

However, even with looking at work experience, education, occupation and industry of current employment, and other demographic and job characteristics, the model can explain about half of the difference, leaving an unexplained wage gap of approximately 20%. To which the GAO says, “s ome of the factors that contribute to an earnings difference affect men and women differently, but we cannot explain why.” This was due in part to the “inherent limitations in the survey data and in statistical analysis,” the GAO said.

Discrimination Theory

Overall, the GAO did not offer an explanation for the earnings difference, which has remained about the same over the past 20 years. But it notes some experts think it could be due to discrimination or the decision by some women to choose more flexible, family friendly jobs.

“The report substantiates previous research finding that a substantial part of women’s earnings disadvantage is not related to how many hours they work, whether they are married or have children, or how many years they’ve been in the labor market,” noted Dr. Heidi Hartmann, president of the Institute for Women’s Policy Research (IWPR). “Discrimination is the most likely explanation for this remaining difference.”

The IWPR went on to document that of the 24% difference in earnings that the GAO model does explain, about two-thirds is due to women and men having different characteristics. However, one-third is due to women and men receiving different rewards for the same characteristics. In fact, in the GAO model, most of the difference in rewards is not associated with any specific worker characteristic, but rather with the fact that women and men generally work in different labor markets – they work in different occupations, and the jobs women work in pay less than the jobs men work in, for reasons researchers have yet to fully document, the IWPR found.

A copy of the complete GAO report can be found at www.gao.gov/new.items/d0435.pdf .