The Incredible Shrinking Wage Gap

Date: April 12, 2016 Last Edit: May 02, 2016

Stop Blaming Employers for Wage Gap

Well it’s
that time of the year again (Equal Pay Day) when the usual suspects for
progressive causes complain about the “wage gap” between men and women and urge
the government to do something about it.

As part of the narrative for the protests and demonstrations held around the country, you can expect labor advocates and anti-business groups to claim that
employers are to blame for the differences in pay between men and women. For
them, the only solution can be more laws and rules such as “Pay Equity” or “Paycheck
Fairness” legislation. 

Advocates of
the elusive concept of “equal pay for equal work” have long lamented the wage
gap between men and women and have looked to big government at all levels (Fed,
state and local) to right this wrong through law and regulation. Even
though equal pay has been the law since John F. Kennedy signed the Equal Pay
Act of 1963, advocates insist that the free market has got it all wrong and
more needs to be done – more government intervention, that is.

However, the often
proclaimed “77 cents on the dollar” difference in pay between men and women is
more the product of creative statistics than reality. A study by the Pew Center
showed that the average gender gap is closer to an 84 cents on the dollar
difference and for younger women with more education it is as small as 93 cents
on the dollar difference. The gap would probably not exist at all but for the
economic downturn in the last decade that suppressed all incomes.

More
regulatory micro-management of employers, especially small business job
providers, is not going to do anything but provide full employment for
government bureaucrats and trial lawyers. Other studies have shown that most of
the differences in pay between men and women can be attributed to education,
hours worked, length of time in the work force and other factors unrelated to
gender.

In fact,
last year an article by the New York Times that claimed that women are
about to overtake men in the middle class earnings category. The Times story
referenced a report that
states that: “The types of jobs that pay middle-class wages — between $40,000
and $80,000 in 2014 dollars — have shifted since 1980. Fewer of these positions
are in male-dominated production occupations, while a greater share are in
workplaces more open to women.”

The real
concern of equal pay advocates seems to be the danger that the market might
correct this problem before they can create a new government agency to regulate
it.

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