But why stop there? American Indian and Alaska native women see the three largest pay differences from equally qualified white men. When you do, you’ll find that your ‘output’ remains the same. Understand what's truly driving the gender pay gap. It’s about the declining relative income of production workers. This is highly reflective of the wage gap in the private sector, which is far larger than that in the public sector. The result is that any relation between ‘productivity’ and wages is tautological — it follows from the definition of productivity. If I select a non-random sample from a population, the properties of this sample need not match the properties of the whole population. The answer is ambiguous — it depends on prices. Mark Dice – Operation Mockingbird – How Media is Manipulated by the Deep State. I’m going to dissect the evidence in Figure 1. First, the labor share of national income has declined over the last 40 years. Follow wage changes of U.S. workers over time. To measure gross income, we multiply the quantity of each commodity sold by its price: To find ‘productivity’, we then divide ‘output’ (gross income) by the number of labor hours worked: When we do so, we find that ‘productivity’ is equivalent to average hourly income: So economists’ measure of ‘productivity’ is really just income relabelled. Among men, the industries where we observe the largest pay gaps compared to equally qualified white men are Construction (Black men: $0.94 RWG), Arts, Entertainment, & Recreation (Black men: $0.95 RWG), and Real Estate & Rental/Leasing (Hispanic men: $0.95 RWG). I’ve already noted that ‘productivity’ is equivalent to average hourly income. The rate has slowed down tremendously and very little gains are being made. (2010). Curiously, the EPI warns against doing so (see the technical appendix here). To get ‘real’ income, we divide ‘nominal’ income by a price index — a measure of average price change: There are many different types of price indexes. A lower court decision in Ledbetter’s lawsuit against her employer (Goodyear Tire & Rubber Co. plant in Alabama) said that she filed her grievance too late and the U.S. Supreme Court agreed. If the price of apples doubles, my income doubles. This seems odd at first. This is a big problem. Please feel free to get in touch using our email casp.editorial@gmail.com. I contrast this with Benjamin Warr and Robert Ayres’ estimate for useful work per labor hour. As a result, each generation faces cyclical injustices that deter people of color from gaining equal footing. It uses the (implicit) Net Domestic Product deflator to measure ‘productivity’ (i.e. Total Cash Compensation: TCC combines base annual salary or hourly wage, bonuses, profit sharing, tips, commissions, and other forms of cash earnings, as applicable. RUNNING HEAD: RESEARCH PAPER 1 Gender Wage Gap Debunked James Leggitt English 1120 February 25th, 2020 In recent years, many ignorant millennials found a study that concluded that women make 77 cents for every dollar that a man makes (Lips, 2016). But this wasn’t quite correct. A mere 5.4 percent of women work in male-dominated fields. Civil service jobs in 2018 were paying men about one percent more than in 2016, €32.81, where women earned an average of €25.69. We can compare Alice and Bob’s incomes directly. They write: “Net productivity” [of workers] is the growth of output of goods and services less depreciation per hour worked. The huge gap between rising incomes at the top and stagnating pay for the rest of us shows that workers are no longer benefiting from their rising productivity. We see this same phenomenon among men. CPI data is from Federal Reserve Economic Data, series CPIAUCSL. Black or African American men at $0.92, a state where 38 percent of the population is black. Improve your chances of receiving a raise when you ask. Printable PDF “The pay gap is closing fast.” In the United States, according to an estimate published by the Institute for Women’s Policy Research, the wage gap will not close at this rate until 2058, which is another generation away for women of today.. The uncomfortable fact, though, is that if we want to create an alternative to neoclassical economics, we can’t use methods that have neoclassical assumptions baked into them. “Women in ‘male’ jobs such as computer programming still face a pay gap compared with their male counterparts.” In 2012, female computer programmers earned 84% of what male computer programmers earned. Because production workers are at the bottom of the income distribution, we expect their income to be below the population average. This increase pulls up the average labor income, causing it to outpace the average income of production workers. Garrett uses the analogy of a growing child. It wants to equate productivity with income when the results suit it — when the analysis shows a productivity-pay gap. Here’s an interesting question. For example, PayScale issued a report entitled: “The State of Gender Pay Gap 2019” based on a survey of 1.8 million wage earners. In a study done by the American Association of University Women, they found that within 10 years of graduating, 23 percent of mothers had left the workforce, compared to 1 percent of fathers out of the workforce. Women’s Soccer Fails To Get More Money, Wage Gap Debunked AGAIN. So a major part of being a heterodox economist is looking for new ways to quantify the economy. Native Hawaiian and Other Pacific Islander. Executives: Employees with the title of vice president or higher. The second rank consists of ‘working supervisors’. That figure rose to 77 cents by 2004 and has increased by less than half a penny every year since. When we control for education, years of experience, occupation and other compensable factors, But the truth is this: when women make the same career choices as men, the pay's the same. During the same time, Bob harvests 5 tons of corn. Using prices to aggregate output seems innocent enough. (Part 2), What if the Government is Just Another Firm? This relabelling of income gives the analysis ideological potency. Neoclassical economists do so explicitly, as I’ve described in this post. For example, at a $0.97 wage gap black women earn $5.46 million over their career relative to white men who earn $5.62 million. The national accounts are based on the principles of double-entry bookkeeping.