Male and Female Earnings Trends—Posner

The statistics on education and earnings presented by Becker are dramatic, but also puzzling, at least superfically. Why should the sex ratio of either education or earnings change over a relatively short period of time (30 or 40 years)? It is fairly easy to explain the growth over this period in the percentage of women who work full time in the market rather than in the household—improvements in contraception, a fall in the marriage rate (though that is a function in part of women’s higher market earnings potential), a reduction in the demand for children (also, however, in part a function of that higher potential), the shift from a manufacturing to a service economy (and the growing automation of manufacturing), and the growth in household labor saving appliances—all these things have contributed to increased female participation in the labor force, but it is not obvious that they would increase the ratio of full-time female earnings to full-time male earnings. 

It’s not as if there’s been a relative increase in the number of jobs for which women are better suited than men. Women are not as well suited to perform jobs requiring upper-body strength as men are, but men can perform virtually all service jobs as well as women can. So an increase in demand for service workers should draw men as well as women into such jobs, leaving the gender wage ratio unchanged. Similarly, one would expect an increase in the returns to education to affect men the same way it would affect women, so that relative graduation rates would not change and therefore would not affect relative earnings. 

One factor in the increased ratio of female to male earnings is undoubtedly that until quite recently most women who worked full time were unable, unless they were unmarried, or married but childless, to spend as many years working full time as they are able to do today. They would have to take years off from full-time employment to take care of their children, and so would be investing less in their human capital than male workers and therefore earning less. And they would tend to cluster in full-time jobs that involve short work days, notably teaching, and so more of their compensation (relative to men’s) would take the form of leisure, as distinct from pecuniary income, than men’s compensation would. Law, and especially medicine, fields that require protracted education and long hours—and are compensated accordingly—would be unattractive professions for most women. 

Another factor is discrimination. Women were largely excluded from the major professions until the 1960s (in part at least because of expectations that they would become full-time practitioners), and their educational opportunities were limited until then as well—many elite colleges and professional schools did not admit women. Beginning in the 1970s, antidiscrimination laws corrected but also overcorrected sex discrimination, by placing pressure on employers to hire and compensate women at higher rates than justified by labor costs. For, in order to avoid accusations of discrimination, employers began bending over backwards to hire and retain women, even ones who were slightly less qualified than men. And the laws forbade employers to charge higher health insurance or life insurance premiums to female employees, even though they tend to use more medical services than men, and live longer, and so cost more to health and life insurers. 

But all this leaves unexplained why women would be graduating at higher rates from colleges and from graduate and professional schools than men. One possibility is differences between men and women in variance in IQ—the issue that got Larry Summers into trouble when he was president of Harvard. Suppose as he conjectured (with some evidence) that men and women have the same IQ but the distribution of male IQs is flatter than that of women—a higher proportion of men than of women have very high and very low IQs. As graduation from most college and most graduate or professional programs requires a normal or high but not very high IQ, the greater male variance in IQ would tend to truncate male but not female graduation (and hence enrollment) rates: low-IQ males would be underrepresented in higher education, but high-IQ males would be overrepresented in just a few programs, such as high-energy physics, and so would not balance the males who were not admitted or dropped out at high rates. Males would continue to be overrepresented in jobs involving upper-body strength, but these tend not to require a high level of education. 

Cultural factors may also be at work, especially in the black community, where academic performance is disparaged among young men but not young women. For example, 42 percent of black women who graduate from high school go on to college, compared to only 37 percent of black males; and just 35 percent of black male college students graduate within six years, compared to 45 percent of black female college students. This implies that 19 percent of black women who graduate from high school are graduating from college within six years compared to only 13 percent of black males. The overall situation is actually worse, because only 48 percent of black males graduate from high school, compared to 59 percent of black females (implying that the college graduation rate for black females is almost twice that for black males); and the disparity is almost as great for Hispanics. Blacks and Hispanics constitute a sizable fraction of the U.S. population. Nevertheless, there is a gap between white male and white female graduation rates as well; the high school graduation rate for white males, for example, is 74 percent, compared to 79 percent for white females, and the college graduation rate is 43 percent for white males compared to 57 percent for white females.

 

 

 

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Cultural factors may also be at work, especially in the black community, where academic performance is disparaged among young men but not young women. For example, 42 percent of black women who graduate from high school go on to college, compared to only 37 percent of black males; and just 35 percent of black male college students graduate within six years, compared to 45 percent of black female college students. This implies that 19 percent of black women who graduate from high school are graduating from college within six years compared to only 13 percent of black males. The overall situation is actually worse, because only 48 percent of black males graduate from high school, compared to 59 percent of black females (implying that the college graduation rate for black females is almost twice that for black males); and the disparity is almost as great for Hispanics. Blacks and Hispanics constitute a sizable fraction of the U.S. population. Nevertheless, there is a gap between white male and white female graduation rates as well; the high school graduation rate for white males, for example, is 74 percent, compared to 79 percent for white females, and the college graduation rate is 43 percent for white males compared to 57 percent for white females.

[Ashburn Dentist]

I was just reading another article similar to this one and a key point was: "Almost a third of working women nationwide now out-earn their husbands. It was inevitable, really. With more women than men going to college, with women taking less time out from careers to raise children, with more women choosing careers that only a few years ago were the province of men, better jobs and better money have become available to them."

[charles pace]

Not long ago, I was working on an issue for a southwestern tribe, which required some analysis of the labor force over time. I found it interesting that WWII had a dramatic impact on post-war earnings and employment of the male work force in pueblos. Apparently, because ownership of wealth (land) was matrilineal, when the men returned from overseas, many sought employment off-Reservation rather than returning to their traditional role of planting, tending crops etc. Perhaps Veblen's "barbarian status" critique is reversible.

Also, as an aside, is it axiomatic that women and men are equally capable in the service industry? Several years I was involved in negotiations with reps of four states, 13 tribes and numerous federal agencies. One time it just so happened that all the female representatives were present in the room and all the male representatives were on the phone. Without exception, all the male participants were struck by the extraordinary effort the female representatives devoted at the beginning of the meeting to establishing a context for their interaction, outside of the context of the meeting. It left us (males) scratching our heads.

[M Hoffman]

This "analysis" is so superficial it is nonsensical. One need only read the articles by Becker and Posner, both men, to note how badly men have slipped in their intellectual abilities compared to the fairer sex. Maybe it is an excess of testosterone. Maybe it is the prevalence of hormones in our food chain. Or, could it be the EXTREME emphasis placed on "athletic" competition for our youthful males. While female students are concentrating on their studies, the boys are "studying" baseball or some other glorified sport and playing military war games promoted by the federal government. Be all you can be. That equates in the Madison Avenue agenda promoted by our government as bulking up like Arnold, carrying a gun, and behaving like a moron. As an example, my son, a person with a high IQ, spent much of the time of his youth in sport, playing these antisocial games and falling for this image promoted by our government and society. Fortunately, as he neared graduation from high school, he began to mature and recognize his delusions. Meanwhile his sister was ahead of him. It took a few years of junior college for him to catch up. Why are women earning more? They are typically more reliable, responsible, socially more adept, and caring than the men WHO RELY upon their services. As an example, it is very likely that both Posner and Becker rely upon women. Am I correct? In my profession, without women staffing the offices we would be helpless. Maybe society is finally beginning to recognize the worth of women who occupy the most critical positions in many of our professional areas. As an example, how would the hospitals operate without the RNs and other staff, primarily women? There are countless other examples. Women, I love them. Men, my sex, not so great these days.

[Jimbino]

I can't take the equality of women seriously until I see a few excel at chess, economics, math, physics, cabinetmaking, auto mechanics, welding, haute cuisine, haute couture and filmmaking.

But I can't wait until bars start featuring "Gentlemen's night."

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[Chuck Matthews, SPHR]

To examine one model, you could run the timeline indefinitely. Eventually, with current stats, women will overtake men due to simple social and incarceration percentages that are unlikely to change very soon.

My concern lies more with what is happening today in the legal context with regards to fairness to employers, i.e. OFCCP/EEOC issues.

[Christopher Graves]

Women, on average, naturally have greater linguistic skills, an ability to read other people's facial expressions as they pick up others' emotional reactions on the fly, are more empathetic and nurturing, and have an innate ability to integrate diverse material more quickly than men. There are studies that support these claims. For example, see anthropologist Helen Fisher's *The First Sex: The Natural Talents of Women and How They Are Changing the World.*

http://www.nytimes.com/books/first/f/fisher-first.html

These natural strengths give women an advantage in certain areas of the contemporary economy especially where they must work with others in face to face relationships, where communications are vital, where new and complex information much be processed and applied quickly. These skills are especially valuable in communications and service industries.

Here's the rub: these natural talents allow women to be uniquely qualified to be wives and mothers who have traditionally been at the center of the home. If women, as a rule, are not directed into the home, then who will take up these roles that lie at the heart of the family since men are not naturally suited to fill the demands of being a homemaker and primary care-giver to children? Helen Fisher makes the point that women, due to the influence of their biology, will always be the primary caregivers of small children.

We are already seeing the problems inherent in the "emancipation of women" from their traditional roles emerging as we find populations of developed countries shrinking, in part, as women choose to delay marriage and end marriages much more frequently than do men and to have fewer or no children. Not only is society suffering from the fallout from gender equality but so are individual men and children. Paradoxically so are the bulk of individual women since women find more satisfaction in relations than achievement and find that familial satisfaction in more traditional marriages rather than egalitarian marriages. Consider the research on this matter by University of Virginia sociologists W. Bradford Wilcox and
Steven L. Nock.

http://www.virginia.edu/sociology/peopleofsociology/wilcoxpapers/Wilcox%20Nock%20marriage.pdf

[Christopher Graves]

Link problem. When I checked the links, the first one required signing in on the NY Times website to access the article. Try this link to see a summary of Helen Fisher's research on sex differences. I hope this one is more easilyh accessible.

http://www.helenfisher.com/downloads/articles/07leadership.pdf

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