Economic Inequality Between Genders: A Community Psychology Perspective

Economic Inequality Between Genders

*Note this was originally written in September 2018.

Gender inequality in the economy is not a new problem. One might wonder why the issue is still the political and social status quo in the 21st century. While it has been argued that it is a myth, some disagree but choose to justify the gap. I support the perspective that the gender pay gap does indeed exist in most countries around the world. I, however, disagree that the solution to this injustice is solely in the individual level. We will look at the economic disparities between men and women from a community psychology lens. Community psychology, rooted in values such as social justice and the emphasis on a multi-level ecological perspective, posits that our environments influence our behaviors. In this, it is different than a behaviorist or individual approach. Community psychology examines how humans interact with institutions, within society as a whole, and how both influence each other. This article will focus mostly on the gender pay gap, which is one of the most obvious measurements of the economic inequalities. I begin with detailing the ecological perspective of community psychology and how it pertains to this issue. I continue with national data and the current perspectives on factors that contribute to economic inequality. Pulling from literature from the last few decades, the article discusses different levels of measuring and observing the gender pay gap, as well as justifications for the inequality, which have helped maintain it. Taking more of an ecological perspective, as is expected from community psychology, I explain that the previous explanatory arguments focus too much on the individual and not the macro-level. More recent researchers are beginning to study the complex social factors that extend beyond the individual. In this case, ecological does not refer to the natural science. Instead, the ecological principles refer to Trickett and Birman’s (1989) four principles: cycling of resources, interdependence, adaptation, and succession. We live in dynamic ecosystems with no “one fits all” types of solutions applicable to each context; this is why an ecological perspective is suitable for such vast, complex issues. The community factors that shape us are important to consider.

In the context of the gender pay gap, cycling of resources may refer to how financial resources flow unequally within corporations. For example, when two employees of different genders but same seniority perform the same work tasks but one’s annual income is higher. The resources do not have to be financial, one can also measure the hours of unpaid work that women complete disproportionately to their male counterparts. Women contribute most of the unpaid household work in addition to employment. Interdependence demonstrates how (sometimes even unexpected or unintended) impact on part of the community can result from the vast inter-relationships in the community. We, as a society, are all indirectly or directly connected. Adaptation refers to ensuring that the process of arriving to a reasonable “solution” to the gender inequality suits society; it may be met with resistance from those seeking to maintain the status quo or even the very same women the process intends to help. In an ecological perspective this is significant because the goal is systemic change and not surface-level delivery of a program or service. As defined by Penelope Hawe (2017) succession alludes to “the history of previous innovations and how the timing of the intervention affects its uptake, shape and interpretation. It encompasses how the intervention matures and develops as it interacts with its context over time.” Time itself can be a context, the world today looks and behaves differently than it did a century ago, and so forth. We cannot ignore the strides towards equality for women over the last 50 years, the same way we must recognize that any reform or action must adapt to any changes within its various contexts.

According to data published by the U.S. Census Bureau (2017), the mean annual income for a man working full-time in 2016 is $61,232. For a woman in the United States that same year, the mean annual income is $41,429. In the past couple decades the national gender pay gap has fluctuated very little, with women usually earning 70–80% of what men earn. Without taking into consideration full-time versus part-time employment, level of education, and occupations, this data concludes that women’s mean annual income is approximately 67.7% percent of men’s mean annual income. While this demonstrates a significant gap in income, it is incomplete. For the majority of this article, I will focus on national median earnings for full-time workers, unless indicated otherwise. This is to emphasize that the gender pay inequalities are defined by unequal pay, usually for equal work.

Various factors contribute to gender inequality in economics

The economic inequality between men and women, when working equally or at the same level, is unjust. With values such as social justice, the community psychology perspective begs the question of what can we examine in order to best deal with the root causes and not just the mere symptoms. The social problem is much more than just women needing to negotiate their wages more.

The human capital approach, as referenced by Hilary Lips (2012), argues that the gender pay gap is not due to various forms of systemic discrimination, but rather women investing into their careers differently than men do. One cannot assume that the reason for the long term disparity between men’s income and women’s is merely due to every woman earning approximately 70 cents to every man’s dollar. It is far more complicated than that. Moreover, the width of the gap between wages is not due to low labor force participation. In fact, research shows (Olivetti and Petrongolo, 2008) that in countries where women tend to participate less in the labor force, the pay gap between men and women is actually narrower. This means they both make closer to the same amount of income, but never meeting at the same amount of income.

One of the factors that contributes to the income inequality is discrimination. It is true, and even in journalistic articles on the subject, the diction demonstrates this subtly as well. The earlier literature reflects an emphasis on women’s choice being the cause of the problem. Even just last year, an article in Forbes magazine by contributor Tim Worstall stated,

“The gender pay gap does not exist because men and women are paid less for the same jobs, it exists because men and women tend to do slightly different jobs. When equal jobs being done out there is reached then we will have gender pay parity.”

Worstall’s perspective is aligned with previous literature, and places blame on women for not choosing the same occupations as men. He goes as far as to argue that if the gender pay gap were due to inequality, then there would be an enormous amount of subsequent lawsuits and “we’d never be able to use the courts for anything else. Half the legal profession would be taking such cases on contingency fees.” The fact that a major biweekly media company published this in 2017 demonstrates that Worstall may not be alone in his views. Later, we will discuss what contributes to this illusion that the gender inequality in the economy is a myth or not a current injustice. The Forbes article is an example that, though the latest research is advancing, the messaging and awareness has not caught up yet. To assume that the gender pay gap is at the hands of individual women throughout the country would be an oversimplification.

A community psychologist would make the claim that it is important to observe the multitude of external factors that affect both men and women which contribute to the gap. The discourse sometimes simply makes the case that women are not negotiating their pay, and that it is their fault. Some articles, like the aforementioned Forbes article, stated that the gap was primarily by choice and did not elaborate in further detail and just deliver descriptive data. Despite sharing credible graphs from multinational credible organizations, some articles held the assertions that women “need to speak up more” and negotiate their salaries . Furthermore, to be fair, more women work part-time than men. What is significant, but at times overlooked, are the factors that are influential to the disparities.

If the gender wage gap were solely a result of individual women’s choices, would income between both genders align better if they worked in the same field? What if researchers controlled for education, in addition to time worked? The “blame” placed on women, coupled with the continued gap despite controlled data, further demonstrates the value of investigating further and choosing to focus on adjusted data that takes into account educational level and differences within occupation choice.

Educational attainment pertains to one’s highest level of completed education. In a meritocracy those with most talent or achievement have the most power or wealth vested upon them. It is a widely accepted notion, if you earn a higher degree, it is correlated with higher wages. If referring back to data collected from the U.S. Census Bureau, findings will not corroborate with assumptions about level of schooling. By the year 2007 women surpassed the number of men completing college degrees and beyond. The number of women earning degrees continues to proliferate, with approximately 38.9 million women in the United States with at least a bachelor degree compared to 35.1 million men.

From the full report of the same census data, it was revealed that the mean annual income for all adult men (ages 18 and up; regardless of race or ethnicity) in 2016 is $82,089. That same year, the mean annual income for women was only $52,461. In the past decade, increasingly more women than men are pursuing higher education than ever before. Notwithstanding the correlation of educational attainment and annual income, the gender pay gap remains. When examining it further, men with advanced degrees beyond a bachelor’s earn an average of $116,617. That’s a whopping increase of over $34,000 a year after pursuing graduate degrees. More women are completing advanced degrees, but the annual mean income of women in 2016 is shockingly only $74,656. The gender wage gap actually widens the higher the level educational attainment. It is not a matter of school performance, since women on average graduate with higher grade point averages (GPA) than men; women are more likely than men to graduate with a 3.75 GPA or above.

In 1991, Lawrence Summers, chief economist at the World Bank, stated “Investment in girls’ education may well be the highest-return investment available in the developing world.”

Indeed, occupational choice matters, an overwhelming number of men are in high-paying science and math roles. Nevertheless, more women in science and math careers is not the only answer. Social psychologists have found that, when controlling for major studied, men still earned more in comparison to corresponding females whom were also working full-time.

Stephanie Pincus, founder of RAISE project program of the Society for Women’s Health Research (SWHR), agrees that subtle socialization is a large culprit to the gender inequalities. The RAISE project was designed to “increase the status of professional women through enhanced recognition of the achievements of women In Science, Technology, Engineering, Math and Medicine (STEMM).” Wang and Degol (2016) state that gender-related stereotypes and biases are just one of six explanations for the underrepresentation of women in STEM careers. They cite cultural pressures as being one of the barriers for women.

An additional popular excuse for the gender pay gap regarding women’s choice is problematic as well. Law careers are considered prestigious and relatively well-paying occupation choice. Within the legal profession, the gap is evident, though showing decrease. According to the Bureau of Labor Statistics, in 2015 a female lawyer’s weekly salary is 89.7% of what her male counterparts earn in a week. When examining data from Miami-Dade County, Dr. Maria Ilcheva of Florida International University observed that within disciplines and fields, women do not advance as far as men. She noted that within the legal field, more men were lawyers while more women were paralegals. To further illustrate controlling for occupation choice: even in low paying jobs, in which women dominate in terms of participation, men still earn more. About one out of six women who work full-time work in service occupations. In the service industry, men earn about $543 per week on average; women only earn $423 per week.

Observing the societal factors is still much needed. However, in Bridging the Gender Gap: Seven Principles for Achieving Gender Balance, the authors Lynn Roseberry and Johan Roos (2014) are trailblazing for other researchers to look at the social issue from a more ecological lens. In chapter 9, the authors conclude that it is not up to the judicial system to resolve gender discrimination. Numerous applications from courtrooms and studies on gender are compared to make a convincing yet dispiriting argument. What may be equally, or more important, is to scrutinize the research more closely on whether findings deliver more context about why women often remain silent when facing discrimination. The workplace is no different, and Roseberry & Roos highlight how discrimination is complicated and not always the result of “bad behaviour” from men or women with malignant intent.

The pressure for women and minorities to not speak up, and to not question their pay nor treatment is subtle but exists. In a meeting of 25 female professors at a large University in Europe, they met to discuss the potential reasons that male colleagues were advancing quicker than the women. In some of their responses, one can infer that there was fear. All 25 faculty agreed that it was challenging to tell their male colleagues they disliked being objectified about their looks and dress (2012). They felt comfortable complaining about it amongst female colleagues but could not bring it to the attention of the men because they were afraid of repercussions such as being called insensitive or being ridiculed. Similarly, in the United States, a 2006 study on gender inequalities in higher education demonstrated that women held only 24% of the full professor status. This means that women were outnumbered by men 1 to 3. In the former, one of the factors was that the men were mentored and supported more, but discrimination still also contributed to the much faster advancement of men. The League of European Research published the stories of the female faculty years later, and when read collectively these cases are evidence that the notion of “the glass ceiling” is indeed real. To clarify, the belief that the slower advancement of women could have been to hiatus in their employment, many of the senior female faculty did not have children. In fact, they were advised not to. To their knowledge, they had never heard their male colleagues offered the same career advice. Correspondingly, there is the disproportionately high representation of historically marginalized people such as women of color “stuck” in entry-level, low paying jobs. In “Workplace Diversity: A Social–Ecological Framework and Policy Implications,” Meg Bond (2014) describes the experiences of these employees as faced with “barriers that stagnate upward mobility, thereby reinforcing occupational segregation and low wages for women and people of color.”

What helps uphold the idea the gender pay gap is not an issue or is justified is that discrimination is often not reported. Few women ever confront or complain openly about gender discrimination in the workplace. How could a woman approach her management team about unfair pay if salary conversations are taboo? Likewise, how can women negotiate for better wages when they are repeatedly undervalued? Is it simply self-efficacy that is responsible for women not speaking out? An ecological perspective would suggest that there are environmental factors and not a matter of women lacking confidence to advocate for pay raises.

Let us investigate why people remain silent about discrimination in the workplace. Calling on social psychology, research demonstrated that when white women and minorities report inequalities the victims are perceived negatively. The whistleblowers trying to put a stop to gender discrimination are looked as troublemakers. No one really wants to ruffle feathers in the workplace, women stay silent or rationalize discrimination because they do not want the negative attention. Moreover, further research provided evidence that whether women were perceived in a negative light after reporting workplace discrimination, whether related to wages directly or not, was not contingent on the credibility of the case (Brake, 2005). In Illusions of Justice, Roseberry and Roos concluded that, when confronting behaviors that were obviously sexist, male colleagues were surprisingly more hostile than when confronted wrongfully for unsexist remarks. Furthermore, minority women are more self-aware of the risks that could arise if they choose to challenge discrimination. Therefore, gender discrimination is under-reported not because it does not happen at work, but for factors that are not in women’s control.

Also, it is arduous to prove discrimination because our human minds create their own criteria of what constitutes discrimination. In essence, discriminating against a person or group is so immoral, that we do not believe it when we see it (Roseberry & Roos, 2014; O’Brien et al. 2009). Similar to the mental schemas that contribute to the creation of stereotypes, if a factual discriminatory phenomena does not readily match our mental template of “discrimination” we do not identify it as such.

In my opinion, it is the “feminization” of jobs that is the most telling examples of how systemic the gender pay gap is. I first learned about this phenomena when learning about U.S. post-world war history. Feminization, in this context, calls attention to increased proportion of women in a workplace, industry, or occupation. In the post- World War II era, there was an influx of women in the workforce. Women were “installed” in more clerical roles with lower pay and less opportunity to move up the career ladder (England & Boyer, 2009). It is just as much a contemporary bias as it is a part of our history. In 2016, the New York Times exposed the drop in wages that subsequently occurs once a job becomes dominated by more women. The article cited examples from several occupations such as housekeepers and biologists. Similarly, the New York Times revealed that the direct opposite is also true, when more men enter an occupation, wages tend to increase.

Why is this social issue important?

One might wonder why the pay across all fields and industries is not more gender neutral. The discrimination is not overt. However there are also some whom affirm that such a gender disparity does not exist. Dr. Hilary Lips, founding Director of Center for Gender Studies at Radford University, states that the human capital approach is used at times to minimize the size of how the gap is perceived (2012).

Addressing the gender pay gap is paramount because of the repercussions it has on families and on the economy. Most single-headed households are headed by mothers (US Census Bureau, 2016). Only about 29.4% of the 11 million single-headed households are comprised of single fathers. These are homes with at least one child under 18 years old. Single-head refers to only one unmarried parent whom was never married, or is widowed or divorced. The gender pay gap negatively affects the well-being of the children who depend on these mothers (Blau, 2012).

A nation’s economy relies on the workforce participation of women. The increase of women in the US workforce from the 1950s to the 1970s boosted the economy. The McKinsey Global Institute (2014) claims that if over 5 million women enter the workforce this would increase the national gross domestic product (GDP). Several studies demonstrate that there is a correlation between having higher than average amount of women represented in corporate boards and the performance of the corporation.

The gap widens when we incorporate intersectionality. Black women in the United States earn just 63 cents per every white man’s dollar (2018). Also, included in that same report by National Partnership for Women and Families, Latina women earn only 54 cents per a man’s dollar! High cost of living in many of large cities where more IBPOC live, further exacerbates the impact of unequal pay. If working past retirement in order to close the lifetime wage gap were possible, Black women would have to work 23 years longer than the white, non-Hispanic man retiring at age 60, Native women would have to work 29 years longer, and Latinas would have to work 34 years longer (National Women’s Law Center, 2017). As Bond would recommend, increased representation of socioculturally diverse populations would be beneficial to both employee and organizations.

This is not just a problem in the United States. According to the United Nation’s International Labour Organization (ILO), there is a substantial gap pay between both conventional genders in the majority of countries. Iceland is the first country to outlaw paying women less than a man. This law went into effect in January 2018. Despite the Equal Pay Act being passed in 1963, there are instances of organizations segregating men and women to different departments and paying women less for the essentially the same level or work. As Roseberry and Roos effectively demonstrate, the legal system cannot solve the gender pay gap alone.

Room for improvement

When one is analyzing the gender wage gap, they must be very aware of how they measure the inequality. It must be calculated while considering other dimensions such as years of experience, comparing within a field or industry, and also level of educational attainment. These dimensions matter, as mentioned before the gap is widest among STEM careers.

Furthermore, revisiting the Census data from 2016–2017, other sources report different measurements for the disparity income between the two genders. Depending on which national or international organization was collecting and analyzing the economic data, there were slight differences in reporting. Few sources make it priority to distinguish whether the data being presented on the gender wage gap includes adjusted or unadjusted numbers. Unadjusted wage gaps solely measure the median wages of all men and compares it to all women. Adjusted pay gaps take into consideration educational attainment, the occupation of the employees and/or the field they are in (such as law, health, hospitality, and so forth), and amount of hours worked. Other potential considerations are job experience and maternity leave. The Organization for Economic Cooperation and Development (OECD) measures the gender pay gap (unadjusted) to be 18.2 percent. This means that the average woman, earns about 81.8 cents to every man’s one dollar. Perhaps making one method of measurement standard over the other proves a challenge, however it is imperative to make it clear to those consuming the data which method is used. Some publications mainly described internal, individual causes for the wage gap, citing that it was by choice of occupation. Most articles within the last three years did not commit context minimization error. Equal Pay Day occurs every April in order to raise awareness. This provides an opportunity to increasingly highlight the interrelated indirect factors that play vital roles in the gender pay gap and advocate for paid maternity leave. The United States lags behind in paid family leave policies compared to other developed countries such as Australia.

Lastly, there are some occupations that are not included in the data, because there are difficulties in collecting data from the entire population. An example of excluded input is that from domestic workers. Most of the data is focused on “formal” work, however without including the information of women and men whom work in households and farmlands, consumers of information do not receive a full picture. On the other hand, there are many challenges to collecting data from domestic workers whose income cannot be easily tracked.

In conclusion, individual interventions to narrow the gender wage gap are insufficient. Through a more socio-ecological perspective, it is evident that the root causes for the gender imbalance in wages are deeper than the intrinsic choices that women make. There are real, external pressures for women to be silent about discrimination, and there are factors that support men advancing in the workplace at faster rates than women despite women’s high educational attainment. When controlling for factors such as college major, educational attainment and GPA in college, amount of hours worked, and level of responsibility within an industry — women still demonstrated lower wages. There is evidence that this is a systemic issue and the solutions are rooted much deeper than salary negotiations. Women are pressured to remain silent on workplace discrimination of all kinds to avoid adverse repercussions, more so than their male counterparts.

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