The Gender Wage Gap And A Solution To Income Inequality

Equality Between Sexes

How would you feel making 25% less than your peers who do the same work at your same level? I'd be pissed and demand equal pay for equal work.

Depending on which study you read, women earn only around 80 cents to the dollar compared to men. Unless you don't have a mother, sister, daughter or wife, men need to pay close attention as well.

Fight The Gender Wage Gap

In order to solve the gender income inequality situation, we must first understand why there is income inequality between males and females. Here are some theories from various sources as to why:

1) Men are more aggressive at asking for raises and promotions.
2) More people in leadership roles are men because men have had a head start. There is a propensity for men to take care of their own.

3) Men are more interested in more lucrative fields such as finance, private equity, management consulting, and engineering of all types.

4) Society puts more pressure on men to be able to make enough and take care of a family.

5) Men can't give birth.

Slow Improvements In Female Wages

From the chart above, you can see a steep increase in female wages as a percentage of men's wages in the 1980's as dual income households became more common.

In 1985 for example, a female college graduate made roughly $62,000, while her male counterpart made $100,000. By 2005, the female worker made roughly $74,000, a healthy 19.3% increase, but still a 24% income discount to her male counterpart.

More recently, the Bureau of Labor Statistics reported that women earned 82.8% of the median weekly wage of men in the second quarter of 2010, the highest ever recorded. However, a 17.2% gap is still not good enough.

There might be a sinister evil empire out there that conspires against women to earn equal pay for equal work. There's probably some truth to every single one of the five points above that affects pay equality. However, if we strip away all the conjectures, and focus only on fact, there is only one truth: men cannot give birth.

The Gender Wage Gap Is Unfair Because Someone Has To Give Birth

One of my good friends graduated from Harvard business school in 2006 and just gave birth. Before having her first child, she swore to me that she'd be a career woman for life.

She loved the challenges of the corporate world and she was good at negotiating deals. After taking three months off for maternity leave, she came  back for a week only to give her boss her two week notice!  Needless to say, her boss was not happy!

My friend lives in a paid off 4,500 square foot mansion in Hillsborough County, one of the richest counties in all of North America. She no longer wants to work because she doesn't need to work. Her husband is a multi-millionaire. She has a beautiful baby girl at home she can't stand staying away from. I'd quit too if I were her!

Someone has to give birth, and it so happens the role is placed on females. If you are a manager of a start-up, and have two equally qualified 30 year old candidates, one male, another female, you will consider the likelihood of each candidate's ability to work the longest throughout the entire year, for as many years as possible.

Wage Discrimination

Start-up life is cutthroat, and you cannot afford any employee to take off longer than 2 weeks at a time. What would you do as a manager? If you don't have all hands on deck, the limited amount of money in venture funding will run out before you can generate a revenue and then everyone loses.

At the margin, it may be logical to bake in an income that incorporates the likelihood chance of a candidate working for 12 months of the year. If the chances are for 10 months of work a year, then the pay might be offered at 83% of par.

Pay discrimination is wrong, but often it's just business. Unfortunately, it is the woman who suffers from such unspoken calculations when hired. I find this a disturbing reality because I would never want my sister, daughter, wife or mother to not earn what their male counterparts earn for equal work. Hence, I've come up with a logical solution.

Solution To Solving The Gender Wage Gap

The solution to gender income equality is passing a law that requires all companies grant the same amount of parental leave for women AND men.

If a woman gets three months maternity leave, then the father should also get three months paternity leave. We need to start eradicating the term maternity leave, and start using the words Parental Leave so that both the father, mother, partner can be treated equally.

Positives Of Parental Leave

Some of you might think it's not fair that the father who doesn't have to go through nine months of pregnancy and childbirth gets to take the same amount of time off. After all, maternity leave really is considered short-term disability my a majority of firms.

However, a good husband will be there for the mother throughout the entire nine months, waiting on her hand and foot, attending classes, and caring for her every need.

A good father will worry just as much, if not more so because he might feel helpless since he's not carrying the child. A good father would love to spend as much time with his new born as well.

Related: How A High-Performing Employee Can Negotiate A Severance – This is my wife's story after she got unfairly passed over for a promotion.

Fix The Gender Wage Gap

As a hiring manager, once you realize there's now an equal chance both man and woman to be on Parental Leave, you have a lower propensity to discriminate on pay. You may of course secretly discriminate based on whatever other metrics you find justifiable, but at least one of the main points is now the same.

If you're unhappy with your employment situation, then I highly recommend you negotiate a severance. I was sick and tired of working more and getting paid less in 2012, so I negotiate a severance worth six years of living expenses.

Get Paid What You're Worth

The experience was so transformational that I wrote a book about how to do the same thing called: How To Engineer Your Layoff: Make A Small Fortune By Saying Goodbye.

It's the only book that teaches you how to negotiate a severance. In addition, it was recently updated and expanded thanks to tremendous reader feedback and successful case studies.

If you feel you're not getting paid what you're worth, start your own business online on the side! It used to cost a fortune and a lot of employees to start your business. Now you can start it for next to nothing with a hosting company like Bluehost for under $4/month and they'll give you a free domain for a year to boot.

Brand yourself online, connect with like-minded people, find new consulting gigs, and potentially make a good amount of income online one day by selling your product or recommending other great products. Not a day goes by where I'm not thankful for starting Financial Samurai in 2009.

Here is my step-by-step guide on how to start your own website.

Blogging For A Living Income Example: $300,000+
A real income statement example from a blogger. Look at all the income possibilities. CLICK the graph to learn how to start your own site in under 15 minutes.

Updated for 2020 and beyond.

76 thoughts on “The Gender Wage Gap And A Solution To Income Inequality”

  1. Skylar Williams

    Thank you for your tip to start your own online business as a way to fight the gender pay gap. I think I am getting underpaid at my job and I think that is unfair but I’m not sure what to do about it. I wish there was some software that could help.

  2. Hi. I’m not sure anyone is reading this as it is an old post. You did not mention the most likely cause and solution: There is no significant gender gap and thus no intervention is necessary.

    The problem is that many studies compare apples and oranges. As you mentioned, someone has to make babies. You are therefore, for example, not comparing one working who shows up at 8 and leaves at 6 every day for 40 years with another of a different gender. You are comparing one such worker with another worker who takes a 6-month gap in work, then needs more flexible hours thereafter. I don’t remember if it was the Obama campaign or the Hilary campaign, but one of the Democrat campaigns raised this as an issue and when their staff was evaluated it was found that their women were paid much much less than your difference. They countered but the higher paying positions are mostly men and the lower paying positions are mostly women. That is kind of the point that there is no real systemic gender discrimination.

    The obvious conclusion of course, is that if women were paid 80% of what men were paid _for exactly the same work_ EVERY smart manager would hire only women because you were saving 20% on your labor costs. You couldn’t hire a man. They cost too much. This doesn’t happen because the gender gap is an illusion.

    I read a study at some time – and yes I acknowledge that social science studies largely start with a conclusion and the author finds data to back it up rather than how real science works where you start with data and the conclusion follows the data – where when apples were truly compared with apples women made something like 97% of what men made. The author could not find a discrete reason why and that was bothersome, but did find that there was little real discrimination.

    My two cents.

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  5. mysticaltyger

    Parental leave doesn’t solve the gender equality problem. Even if you force men to take off, they would tend to work off the clock. Susan Pinker found in her book, The Sexual Paradox, found that male professors who were given parental leave would come back with a book or other research project completed whereas women usually did not. I think a lot of these differences are biological in nature, and so does Pinker.

  6. Strangely the only experience I have with paternity leave was at a startup! (Go figure) Haven’t seen it since. He was very happy to take the time off. He and his wife went to Europe and stayed with their family there. The rest of the guys in the office were pretty supportive. They were all younger guys.. so that may have something to do with it – the young can adjust to changes better! They did make jokes about his time off as traveling to Europe and having a family look after your kid doesn’t seem like too much work for them!! I am in Canada though. We are entitled to up to 37 weeks’ parental leave (its unpaid). Even though we do many haven’t taken advantage yet..

  7. Just a comment on my experiences.
    I used to work at a store and had to do backbreaking work unloading pallets of 40 – 60lb boxes on a daily bases. This job was always defaulted to the male. The girls in the store would work all the lighter items because it usually would take them 4 times longer to do the heavy job. I wanted money for a cool car and to go out, so i was always volunteering to work extra days and hours. All the women consistently declined any extra work. I never called off, even when sick, even broken toe, lacerations. The women called off for PMS, cough, just feeling ill, kids plays, and all kinds of bs. When we came up for raises guess who got the majority? The Men… Shocker!!!
    When i became a professional there was less discrepancy. But women still didn’t work as much. I have 3 jobs. About 1/3 in my colleagues, that i know of work as much, and all are men. While there is no heavy lifting, the overtime work, days and hours are still horded exclusively by the men. And there is still a discrepancy in sick days. One guy i know came to work with a urine catheter instead of calling off. I have yet to see a women do anything close.
    I know this does not account for all, but there is something to be said about mens psyche and strengths when this topic is discussed. And it always seems to be left out.

  8. You should take a poll of how many fathers would take maternity leave to aide pregnant women. I’m curious to see how many would accept it.

  9. Sam,

    I was thinking about your earlier post… more men are unemployed now but in this post it shows men are making more.

    So it means companies are shedding their higher salary people… so woman may make less but have better job security. Not a bad tradeoff…?


  10. I’ve been thinking about this a lot lately. I work in a male dominated field (financial services) and while I don’t plan on having any children for around another decade, I do wonder how my work would react.

  11. Equality all around is a great concept. Our society is filled with biases of all sorts, and both women and men get shortchanged at one thing or another. Sometimes, this can cause a real impact on lives when totally unnecessary and preventable It’s good to have such discussions to bring topics in the open so that they can be looked at intellectually.

    I have heard negative things said about a guy who wanted to take paternity leave some years ago. Along the lines of it implying that he’s not a “real” man, not a true provider, a slacker on the job, etc. It left me thinking that the person suggesting those things was a complete tool. Anyway, I do believe that the guy wanting to take leave did in fact do it.

    1. Stereotypes are real. A man who gets a lot of girls is a player. A woman who has relations with a lot of men is a slut. It’s a real perception. A man is supposed to work hard. Hard as he can. And not complain. If you don’t work so hard and complain a lot, that might not get funny looks in France but here we have different views of what manly is. Different values of different countries probably explain why this country is a lot more productive than, say, France, and why we are back-to-back World War champions.

  12. I LOVE this idea! I don’t necessarily know if I will have kids, but this would definitely make a huge difference.

    You know what would also be cool? If employers had to actually pay money for the parental leave to BOTH genders.

  13. I like the concept of family leave, but i’m still not sure that it would close the wage gap. Obviously, if each took off the same amount of time and did the same work, they should get paid the same, but what if one was a better performer (male or female) or had more experience? Should a wage gap exist in that situation?

    1. Yes, a wage gap should exist if one employee is more qualified than another for sure.

      There will always be a discount or a premium. The point is to narrow it so that it statistically doesn’t really matter.

      Besides, I just want my 3 month parental leave too.

  14. Every single one of my gen-x friends is out-earned by his wife. I think these stats are going to adjust hard as the big money earning boomers leave their positions.

    1. That’s awesome! And I hope you are right! It would be great to get pay equality, and also lessen the burden of men to support the entire family. This could be the dawn of a great era for women and men!

  15. I very much agree. There are many reasons to advocate for fair treatment of all employees. However, don’t under estimate the role of #2 on your list, either. My company does offer parental leave but the good old boys network is still strong (as it is in most firms) and you can see it in the pay scale.

  16. I like the parental leave idea. It could also help with child care costs; mom takes off the first 3 months, dad takes off the following 3 months. Both parents could bond with the baby and not have to worry about day care options until the baby is 6 months old and hopefully can handle germs better. (Day care centers have germs, you know. ;) )

    As for the salary issue, it’s definitely unfair. Even if a woman quits after she has her baby, she was still doing the same job a man would have done in that time. If anything, why don’t companies pay their women the same, but require they pay a “rehire” fee if they decide to quit after having a child. That way the woman earned equal pay, but her manager is reimbursed a small fee for having to go through the hassle of rehiring for her position. Problem solved. Thoughts?

    1. I think that’s a great idea alternating 3 months for the mom, 3 months for the father! It could cause a SERIOUS decline in production output, but hey, that’s equality!

      Taking 3 months off, to only come back and say “I quit” is kind of rough… implementing a reimbursement fee sounds fair if that happens. We have that when companies pay for our MBAs. Got to stay on for 1-2 years or else you must pay back.

  17. You hit the nail on the head with this post. Although people would never admit to it – and legally in the UK can’t – the primary reason for hiring a man over a woman (assuming equal resumes) is the fear of the woman getting pregnant and not returning to work. Controversial topic indeed but good for you saying it how it is!

    I agree with other comments that fathers should get equal rights to paternity leave – the rule in itself is sexist; giving woman longer leave than men.

    1. I hear the UK is incredible AWESOME for employees! 6 month maternity leave, 3 months heads up that you are going to get laid off to use the company resources, etc. Is this the case? Help clarify!


  18. BusyExecutiveMoneyBlog

    Great topic…this is a tough one. I think it is changing but has a very long way to go. We need to get more women into the pipeline for the highest paying jobs. Women on the other hand, have to stick it out to get the experiential exposure. It starts with the men in charge…identify, and challenge women. Given equal coaching they will succeed. I personally have two female leaders that i highly compensate based on results and potential.

  19. It may well vary by country. In my mgmt team in Asia, 80% are all women and women make up the top 3 salaries besides me (who is the boss of the business unit and gets paid the highest, natch). Women also get 8 weeks maternity leave and fathers get 3 days leave.

    Here it seems like women are better negotiators of salary. In many households women run the budgets and the finances. Somehow the men are content to sign over their paychecks and then go out drinking & playing cards. Funny that.


    1. Such interesting perspective Mike! Gosh… 8 weeks vs. 3 days.. that sucks!

      Guys are simple. Seriously. Cards, drinking, maybe play a sport or something and that’s it!

  20. Here’s the basics- most women don’t get paid maternity leave. They do get up to 3 months leave protected by FMLA after bringing a child in to their family. Men get that exact same protection.
    What women do get that men don’t (usually) is short term disability that pays their salary at 50-66% for 6 weeks after giving birth (or 8 weeks if they have a C section). That’s right, women are considered disabled for 6-8 weeks after giving birth.
    I’m pretty certain that women in poverty stricken countries would be pretty surprised to learn that they are supposedly too disabled to work for 6 weeks after giving birth.
    But wording aside (though I would argue that labels do, in fact, matter) the fact that women are covered under the disability program after giving birth gives rise to two beliefs- that all women have paid maternity leave (nope- covered under the same leave a man would get if he had to have knee surgery), and that women get really long paid maternity leave. Again, the FMLA protection does not require leave be paid, it just requires the person still has a job. However, if you only have to use 33% of your PTO to get your full pay for 6 weeks, that leaves you with 66% of your PTO left to help cover the rest of that 3 months if you want to take it. This means that a women giving birth only needs 320 hours (8 weeks) of PTO to cover a full 12 weeks off at full pay.
    Paternity leave, while protected by FMLA exactly as maternity leave is, does not qualify for disability coverage, so if men want to get paid while on those 3 months of leave, they must have 480 hours (12 weeks) of PTO saved up to to receive their full pay for the entire time.
    I earn 208 hours of PTO every year (26 days- 1 day every 2 weeks). I can store up to 150% of that. If I’m at 150%, I don’t earn more PTO until I start using it. As a woman, that means that if I start at my max PTO and have 6 weeks of disability, I would be able to stay out 11 weeks and 4 working days and still get my full pay.
    If I’m a man, I run out of PTO after 8 weeks and 3 days.

    Now here’s the thing about using disability leave to claim we have paid maternity leave in this country- not only does it imply that women are disabled by giving birth, it also only applies to women who give birth. That means it discriminates against every father and mothers who choose to adopt.
    We call it maternity leave because we know it discriminates against fathers. But it’s not even maternity leave, because we don’t offer it to all mothers. We only offer it to those who are pregnant. In other words, this country has pregnancy leave.

    While I don’t think we need to go as far as the Scandinavian countries (where each parent gets something like 6 months completely paid, can be taken consecutively or concurrently) I agree that we need parental leave in this country. We need to stop calling women who give birth disabled and we need to stop discounting the contribution of parents who don’t give birth.

    I’m lucky in that my company offers 2 weeks child bonding leave, fully paid, without touching PTO for any new parent- no matter how they become a parent (also applies to foster parents when a new child enters their home).
    Now we all know 2 weeks probably isn’t enough to actually adjust to having a new child in the home, but at least it’s something.

    1. Thanks for the clarification on disability, as you are exactly right. Guys get disability too, but of course, since men can’t have babies, they don’t qualify when the wife gives birth. I have no idea, but I am assuming 30 days is generally long enough for a woman to heal?

      Companies can just call disability leave, parental leave for fathers. Or just recategorize all together to just Parental Leave. Can’t it be that simple?

      1. Companies don’t call it disability- the state does. That’s not something companies have any control over. From my understanding, it’s pretty universal- all states have the 6 weeks for a normal birth, 8 weeks for a c-section, but that is state law, not company policy.
        I should also say it’s not “pregnancy leave”, it’s giving birth leave- women who miscarry don’t get the same amount of leave. But birth mothers- women who give their babies up for adoption, do get the full 6-8 weeks. (Please note as a hopefully soon to be adoptive parent, I am grateful to birth mothers, and am not discounting the fact that they’ve given birth. But women’s bodies are made to be able to give birth and then to be able to care for the child starting pretty immidiately. Giving birth does not disable most women.)
        Calling giving birth a disability was done with women’s best interests at heart- it meant that it didn’t matter if employers offered a maternity benefit or not, women were guaranteed some pay and the protection that goes along with temporary disability. It was a gov’t work around from another era.
        As a society, we have progressed to a point where that work around should become a relic. We need equality in parental leave for all new parents.

        1. Yes, it is quite interesting how a parent who adopts a newborn does not get the same parental leave as a mother who gives birth.

          I’d love to hear other women who’ve given birth chime in on how long it took them to recover, and what their thought process is on pay, time off, etc.

        2. As an interesting side-note on the disability point. Did you know that minimum wage and maximum hour laws got their start in this country because states wanted to protect women? Yup, women because “women couldn’t fend for themselves” or “needed extra protection” states passed these laws. At first the Supreme Court struck these laws down because it was thought unjust to make these assumptions about women – the Court was saying that women were equal to men. Of course you can’t boil down about 40 years of legal history and case law to one or two crass points, but one of the principal changes made to the laws that made it so the court upheld them was to apply them to everyone (the other change was a sudden shift in the way the court did business during the New Deal). The relevance here is that laws which got started based on sexist views about needing to “protect” women sometimes do eventually do get expanded to cover everyone. So it wouldn’t surprise me at all if in the next 5 to 10 years paternity leave laws because standard.

        3. I also expect that in 5-10 years the US will start catching up with Europe when it comes to parental leave. And I know these changes take time, but it always seems silly to me when we use the excuse “but this is the way it’s always been” to prevent ourselves from fixing what is obvious discrimination.
          We’re getting there, as FMLA protects parental leave equally for mothers and fathers, regardless of giving birth or adopting. It’s the state and company policies that use short term disability to cover maternity leave, that are still behind.

          1. I’m not sure catching up is the right phrase. Europe is a lot less productive than we are and are not able to project and protect their interests as we are. It is simply a biologic fact that only women can give birth. And nurse a baby. So far I like America and I think Europe is off track and in the process of failing. Many of us still believe in America and believe we are a power of good. Europe has given up on its self confidence. It has brought too much “multiculturalism” in and is giving up its values to be replaced by others’ values that may not be benign.

    2. Btw, I would be most upset if I was a single woman, or married woman who couldn’t have kids in this case and see a female colleague to take 3 months off every year for multiple years.

      1. Most women don’t have a kid every year. (Your not supposed to be able to get pregnant while lactating, though we’ve thrown off this natural balance by bottle feeding- which I’m not judging. It’s simply a matter of biology.)
        But it is frustrating, as someone who hopes to adopt, to know that I won’t be able to have three months off paid with my new child, even if my child is a newborn I bring home from the hospital because I don’t qualify for disability nor can I use my sick time left over from our old system (I’m actually going to be doing some push back on this) because I didn’t physically give birth. Giving birth does not change the demands a new infant places on it’s parents (both of them).
        I think men have a right to be annoyed- not that women get paid maternity leave (kind of), but that we don’t all have the same parental leave benefits.

        1. Paid time off? I assume you are an employee not an owner. I am a small business owner. I can only pay rent and pay employees when money comes in. If an employee is off for more than negotiated vacations I have expenses but no income. The business will not survive. I bet a large corporation where one person makes little difference does not notice but if I had an employee – or probably if most small businesses had an employee take three months off and I had to pay her, and if I also had to pay equal or more salary for someone to do her job … well that’s something the company could not afford.

  21. Hey Sam,

    Great job on tackling such a controversial topic! I’d be curious to see what actually causes the disparity (if it is subconscious, or intentional). One thing that I always try to remind people is that employers will try to get you at the lowest price they think they can. Employees, in general, will never receive what they are worth in pay, as there would be no financial benefit to a company for hiring them.

    Obviously, there are inefficiencies in the system (such as the lazy guy who works at a mega corporation), but if an employer won’t gain from you financially, then they have little incentive to hire you. Maybe the employers bargain more aggressively with women as they feel less intimidated by them. Either way, it’s a shame. I certainly wouldn’t mind Paternal leave! Good read! :-)


  22. Hello There,

    I would love it if hubby could stay home once we do have a child! I like this Parental leave idea, I’m not sure if employers would go for it though. It’s a very interesting thought. I’ve always been curious how they arrive at the statistics though. If you take the hourly wage into account, then draw that out to an annual salary, you’ll end up with different numbers.

    As an example, I worked at an office where many of the women were chronically out on FMLA because of health issues, but rarely were the men out (to be honest, I can’t recall a single case for men on FMLA). Once sick pay and vacation ran out, the women wouldn’t receive any pay. This fact alone would create a huge discrepancy between the annual income of the men and women.

    I don’t know how those are accounted for in these types of statistics. I agree though, if Men and Women are doing the exact same job at the exact same efficiency, they hourly pay should come out to the same.

    Humbly Yours,
    Humble Laura

    1. Hi Laura,

      Statistics are quite misleading indeed. Given we are in the land of lawsuits, I cannot believe there is much discrepancy on a PER HOURLY wage for the same position. However, for the yearly income total, there might be.

  23. As a father, I love your solution. Only one problem I foresee… The proof of who the father is for the parental leave. Maybe require paternity tests for fathers who choose to take this leave? Regardless, I think this would be the biggest step towards income equality. Perhaps a senator or congressperson will read this post and come up with a bill.

  24. I think it may help, but it won’t change people’s thinking in itself. As you pointed out, you have a chance to hire one person from a choice of a man or woman. You will decide against the woman not just because of paternal leave, but childcare issues. We discriminate all the time. I experienced age bias, but it wasn’t considered illegal. Companies did not consider my resume because I was too old (experienced) and expensive.
    Just changing the pay is a good first step, but changing the job may be a good second step. Things like flex hours, working from home or job sharing to accomodate people. It may even make people more effective.

    1. The solution is equal parental leave for men, women who adopt, and employees who don’t have have kids!

      We will crush our productivity, but at least we will all be treated equally.

  25. Sigh. While sympathetic to your concerns, I think you’ve made a critical mistake that almost everyone (including me in the past) has made on this issue.

    If you have four minutes, I highly recommend this video, by Prof Steven Horwitz called Do Women Earn Less than Men?

    In it he rebuts the myth that women earn 75% (or 82.8% as you cite) of what men do because of labor market discrimination. True, women do earn 75% of when men do AS A NATIONAL AVERAGE, but analyzing the data more closely, you finds that women make certain choices, such as degree selection, career selection, and raising children, which tend to result in lower wages than men. When you look at cross-gender comparisons of men and women with the same education background in the exact same career then by and large there is equal pay (about 98%).

    Now, of course, the choices women make (different majors, less well paid careers, leaving workforce for kids) could be the result of personal preferences or sexist cultural expectations for women’s work, but the relative influence of these two factors remains unclear. [Note Horwitz’s follow up post here – – which explains that discrimination or sexism may play a small part of the remaining differences, but that the casual connection between sexism and pay gap is mostly in capital market decisions (college and society) and not in the labor market (the workplace)]

    I second JP @ Novel Investor’s concern about lowering male pay just to achieve equality. It is not justice to cut someone down so that they are equal in size to someone else. If men are standing above women, the answer must always be to raise women up. Instead of tearing people down to the level of the disadvantaged, let us instead only try to lift the disadvantaged up.

    As noted in the video, perhaps we should decide to encourage women to enter the hard sciences and other high salary fields in greater numbers, perhaps we should try to change societal expectations so that men share more of the housework, etc. Or maybe society shouldn’t try to dictate to women what choices to make. If for non-discriminatory reasons they choose certain majors/careers or to spend time at home, etc, and this causes a pay gap, isn’t this an acceptable result?

    If the concern is that women receive equal pay for equal work – then women largely have that (remember for a woman and man with equal education, time in workforce, and same careers it is 98% same). But if the concern is to make women and men identical, then you should recognize that that is what you are trying to do. I would, however, prefer to expand both men and women’s choices on career and work at home, not force everyone to make identical choices. The “75% wage gap” is a statistic comparing apples to oranges. Not only does it tend to denigrate the work done at home (because no value is assigned to that work), but it implies the need for nonsensical policies.

    Further reading:

    1. You’re missing my point. The thesis is that because women are the one’s who have babies, removing themselves from the work force by 1-3 months decreases their pay for the year ceteris paribus. In order to equalize pay, men should also have the ability to take equal amount of parental leave, so the company/boss cannot discriminate as easily.

      1. No, I didn’t miss your point. I just didn’t respond to it the way you would have liked. Largely my point was that nearly all of the gap is explained by factors that are not discrimination. Furthermore, only part of the gap is explained by leaving the workforce for childcare purposes (others parts are degree selection, etc). Thus, even if you force employers to give men the same ability to take leave, this does not mean that wages will equalize. At best it means that portion of the gap attributable to childcare duties will go away. And even that is a dubious assumption because it isn’t likely that men will take the leave at the same rate as women or for the same time, because of society’s expectations regarding who should stay home to do child reading.

        Lastly, I know that you think that its unfair for a boss to pay more to a man than a woman solely because she might leave the workforce to have a baby and I’d say you’d have a great point if that was true, but the data I was giving you states that today, men and women entering the workforce with have equal pay IF they make the same choices. That means a woman who chooses to stay in the workforce and does not have children will have the same salary as her male counterpoint. That means the difference in pay in that scenario is not based on gender discrimination, but rather on discrimination between two choices (to have a kid and then stay at home with them vs not doing so). Merely mandating that employers offer paid paternity leave is simply not going to drastically reorder societal expectations. Your proposal *might* make changing societal expectations easier but you are left with conundrum that you WILL have to do that (on both child rearing and other issues) to completely erase the wage gap. I am not saying that expectations shouldn’t be changing in society, but simply passing the parental leave law won’t make the magic employment fairy wave her wand and fix all causes of the gap.

        1. OK, glad you didn’t miss my point.

          Mandating employers provide equal parental leave for fathers is the single biggest step to equaling the wage gap imo. I can’t think of anything else that will be as impactful, and as immediate. It will help eradicate the fear employers have of only women taking time off.

          Do you have a concise suggestion?

    2. A non-parental leave note on the pay gap:
      It would be so nice to say “oh this isn’t a problem. women just choose lower paying careers, or less lucrative degrees.” Nice, neat,simple and a load of BS.
      The most recent studies account for those things. What they still show, over and over again, is that women coming out of the same college as her male counterparts, with the same degree, and the same grades, will be paid less to start. And as the years go by, and raises are given as percentages of pay, that gap widens.
      This is not to say degrees and self selecting aren’t part of it. The most nuanced report I know of is a text book (The Economics of Women, Men, and Work) and it shows that the self selection accounts for about half of the wage gap. 10% is accounted for by other factors (like women not negotiating and having babies), but that around 40% still can’t be explained by anything other than discrimination.
      The problem isn’t just about employers valuing women less. It is about us as a society and what we teach our daughters. There’s a wonderful book called “Women Don’t Ask” and it’s about how women don’t negotiate for ourselves. If you tell us we’re negotiating on someone else’s behalf, we are as good (or better) at it than men. But for ourselves- we’ve been told that good little girls don’t ask for things, that good little girls take what they are given and are happy with it. We are told that girls who ask are pushy, are nags, are bitches.
      Funnily enough, boys who ask are natural leaders, go getters, and ambitious.
      I am a flaming feminist- a flaming equal rights-ist really. And the pay gap can’t be solely explained away by degrees, job choice, or even having kids (though they all factor in to it in one way or another). The pay gap is can only be fully explained by accounting for the different ways we value women and men’s contributions to society.

      1. 2 comments:

        1) You said “The most recent studies account for those things. What they still show, over and over again, is that women coming out of the same college as her male counterparts, with the same degree, and the same grades, will be paid less to start. And as the years go by, and raises are given as percentages of pay, that gap widens.”

        Can you actually provide any of those studies. The professor I linked to has a wealth of information and the most recent studies I have read state the opposite of what you state: that women and men coming out of the same college with the same degree and grades have virtually identical pay at start today.

        Also, you mention the textbook says that 40 % of the gap is unexplained, but the info I referred to shows that less that 5 % cannot be explained by degree and self selection and the other factors you mentioned (negotiation, babies, etc). That is a huge discrepancy between those numbers!

        2) You said “It is about us as a society and what we teach our daughters.”

        That’s exactly what I am saying! I agree. But societal expectations are not the same thing as invidious discrimination by employers. And if expectation are the root cause, then logically the solutions rest mainly with changing what we teach our daughters and not in forcing employers to comply with new laws which don’t actually address the causes (at best the address a symptom).

        Also, you finished “The pay gap is can only be fully explained by accounting for the different ways we value womens’ and mens’ contributions to society.” True, but I would add that the problem is also partly that we devalue the work women provide when they raise children or stay at home. Since no monetary value is given to that work, a measure of wages cannot capture the value of that work. Personally, I think the work performed by mothers and homemakers is far more valuable that much of the work performed by those with high wages. Perhaps choosing to measure an individuals value to society solely based on the wages they earn isn’t the best way of measuring at all.

        1. Here’s one study from Feb 2011, specifically about the pay gap in physicians which appears to be growing, and can’t be accounted for by specialty, hours, etc.
          This article from Time in 2010 talks about how even in female dominated fields (like secretarial work) women earn less than the men who are in the field,8599,1983185,00.html. It does say that when accounting for things like “men’s” fields paying more than “women’s” fields (which really is a problem in and of itself that we think of jobs like that, and that we assume women’s work is worth less) the pay gap has women earning 91% of what men make.

          And this article (sorry, can’t find a date on it) talks about all the different excuses we give for women earning less and in general debunks them

          Sadly, I can’t find the reference to the study I remember reading last year that talked specifically about women from the same universities/same degrees, but I will keep looking and post it if I can find it.

      2. One problem I find is that where real science collects data and the data lead to a conclusion, social science starts with a conclusion and looks for data to support it. Will one in five women in college be raped? Of course not. That’s absurd. And yet it is common sense now. If you name any issue in social science, I can tell you what the conclusion will be based on if the writer is right wing or left wing. That is not how real science works.

  26. I love the concept of parental leave although most of the companies I’ve worked for DO offer paternity leave–I’m nbot sure if it’s three months though. I know my husband’s company gives him 3 months. and honestly during those first three months, i would love all the help I can get.

  27. I’m kind of with Jason here — mothers aren’t required by law to take all the maternity leave available to them. If you want to come back to work after 2 weeks, you can. Having given birth three times, I can tell you I’m reasonably functional at 2-weeks after. It’s just that most women don’t want to. Some companies (not many but some) do offer a reasonable length of paternity leave. A lot of men don’t take all of it because…there’s the ambition issue. You want to be seen as a go-getter, and as a man, taking off 3 months to care for a child doesn’t send that signal. I don’t think that’s right, but it’s also business. I tend to think that a big chunk of the gap stems from women not being raised to think that they need to earn enough to support a family. Boys grow up thinking they need to support a wife and kids, even though most women work for pay. Women assume their husbands will work and that their income will be extra. Even though this is no longer the case for many families. Attitudes change slowly. A guy thinking about supporting his kids is going to negotiate hard for a raise. A woman who is told by society that she shouldn’t be away from her kids at all may not negotiate that hard. Of such things is the pay gap made.

    1. Hi Laura, good to see you here. Didn’t realize you read my little slice of the sphere.

      I’ve asked around 10 male friends about parental leave for them, and they said 1-2 weeks MAX. Never heard of more.

      Let’s just level the parental leave playing field shall we?

  28. If maternity leave is the primary reason for the pay difference, your solution would give companies a reason cut male salaries in response to the law. Just a guess, but some families and a lot of single men might have a problem parting with 25% of their income. Is taking a 25% pay cut over the life of a career worth having paternity leave?

    1. It obviously is, because there are thousands, if not hundreds of thousands of women out there fighting for equal pay.

      And, if male salaries are cut to equal female salaries, is that not equal pay and justice?

  29. Dollar Disciple

    Paternity leave is something our HR manager is pursuing right now. I hope she pulls it off since I will likely be using it in 2013 :)

    I think you are right, and that pregnancy is probably the single biggest reason for the gap.

  30. Liquid Indepdendence

    We’re also seeing more stay at home dads now so like the idea of just having ‘parental’ leave regardless of your gender. It’s only fair. “Nobody gets pregnant just so they can get time off.” Lol, so true.

  31. I love the idea of parental leave. That could be one thing that helps equalize the playing field. I hope as my children enter the workforce things will be more evened out. That’s about 15 years away, but it does seem that we are slowly but surely moving in the right direction.

  32. As a female it gets under my skin that women are stil paid that much less on average. I’ve openly asked for raises and promotions so my managers were aware that I was committed to working for the firm and wanted to be rewarded for my performance. It made a difference but I sti have no way to prove if my male counterparts are making more than me or not.

    I like your proposal on making companies grant parental leave. I was looking through my company handbook and for my firm it says 1 week of parental leave. That just doesn’t seem anywhere near long enough for fathers! The maternity leave length depends on how long you’ve been at the company and if more time is needed I believe that then falls under short term disability.

    It’s hard when anyone is out of the office for an extended time but I think both parents should get the same time off if possible. I know I’d want my DH to be able to be at home and help me and the baby if we had a child.

      1. Why would it be fair for a woman toget paid parental leave for 3 moths and a guy to veto ZERO pay during his parental leave? That probably hurts women’s incomes if this is so!

        1. Money Infant

          Yep its so, I took a month off when my daughter was born. My wife took the full 3 months, went back to work and…quit lol. Of course now its me who is staying home and her that is working, but I see your point about equality in every aspect. Funny how this has been an ongoing struggle for over 50 years now in the US. When will things become equal…I don’t know.

  33. Parental leave won’t fix it because most men won’t take the entire allotmen

    A bigger indicator of statistical differences later in their respective careers is if there was maternity leave taken. It’s not technically a motherhood penalty, but rather, a recognition of the fact that missing 25% of your work year means you lose out on networking, promotion opportunities, cyclical raises, and pure face time. A chronically ill man has the same losses.

    It’s also a strong argument against working from home.

    1. I agree that this won’t fix it. The employer was pissed because she quit, not because she took the parental leave. Whether her husband also takes parental leave or not, she still would have quit. And both parents won’t quit, obviously, because someone needs to make money. Historically, it has been the woman who stays home, but this has gradually been changing somewhat.

      Also, @Sam – are you sure you would take parental leave in a heartbeat? Most parental leave is unpaid, for one thing. But you do know that parental leave is not about long lunches and afternoon tennis matches, right? :) It’s about 24-hour care-taking of an infant, which is wonderful, but you won’t experience the type of accomplishments which keep you going at work. You may go days without a shower, smell of spit-up, be exhausted, but can’t for the life of you think of what you did that day!! A lot of men (and women) are very eager to get back to work just to get a break!!

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