Something to Consider: Gender Wage Gap Fallacy

by Kristin Knepper

Disclaimer: I am all for women’s equality. Equal rights, equal pay, equal nipples. Cool. I am not, however, fine with people looking at facts from the surface, without any deeper thinking. There has been a lot of discussion of equality because women supposedly earn 77 cents for every dollar a man earns. But if you take a closer look, you’ll realize that gap isn’t as large as people think.

When I first starting learning about the flaws in the gender wage gap theory, it was in my anthropology class. My professor explained, plain and simple, that one reason women do not have higher pay is because they don’t ask for as much money as men do! Mind BLOWN. But plain and simple, we know it is true. In fact, one University of Texas study proved women asked for $7,000 less than men, on average when negotiating salary (NPR, 2014). Women are also less likely to ask for raises or promotions, while men are generally more aggressive with salary negotiations. But there are many more reasons why women earn less than men on average.

One reason for wage gap is occupation. More men work in fields such as medicine, law, and engineering than women do. Likewise, more women work in fields such as education and nursing than men do. The median salary for a lawyer is $78,000, for a nurse, $66,000 per year (USNews). So here we see another explanation: the female dominated fields pay less on average than male dominated fields.

Women also value other benefits, such as health insurance, child care, or more flexible hours more than men do. Women are more likely to accept a lower salary for those benefits, according to a CONSAD Research Corporation study. Many women leave the workforce for a long time after having children, or have part-time jobs. Part time jobs were not included in the 77 cent study.

When you take the aforementioned factors into consideration, the gender wage gap is 96 cents. So ladies, are we really that bad off?

Works Cited:

"Best Jobs." USNews and World Report. N.d. Web. 10 Mar. 2016.

Iacono, Corey. "Is the Job Market Sexist?" Foundation for Economic Education. 2 Dec. 2014. Web. 13 Mar. 2016.

Milne-Tyte, Ashley. "Why Women Don't Ask For More Money." NPR. 8 Apr. 2014. Web. 14 Mar. 2016.

 

Arguments Against Raising the Minimum Wage

by Kristin Knepper

Recently, workers across the US have been demanding that states raise the minimum wage rate to 15 dollars an hour. Senator Tom Harkin has recently said “People who are making the minimum wage, basically they're spending just about all their money because they don't have much left, so if you give them a raise, it means more for our gross domestic product." (NPR, 2012). Many of my friends have shown support for this, without understanding the full implications of raising wages.

It is most simple to think about minimum wage from a small business perspective. Businesses pay wages based on the productivity they derive from that employee. When the minimum wage is increased, businesses must ensure the new price reflects the benefit they receive. They can either demand more productivity from each employee, or fire the least productive and only employ the most productive workers. This actually leads to more unemployment and fiercer competition, hurting the lower class. It will also lead to the closing of businesses in the long run, because they will be unable to operate with higher costs. Or they can operate at higher costs, by raising prices. So now employees have more to spend, but goods cost more. They are just as bad off as they were before.  As chief economist to the National Federation of Independent Businesses explains, "It's not the job of businesses to turn themselves into social service providers and pay in excess of value to the firm, we do have something called the earned income tax credit, where we provide supplemental income to people who are working but need more money." (NPR, 2012).

Raising the minimum wage without thinking of the unintended consequences will hurt, not help the lower class and unskilled workers. “The best wage rates for labor are not the highest wage rates, but the wage rates that permit full production, full employment and the largest sustained payrolls” (Hazlitt, 1979). I think my friends would agree, it’s better to pay 100 workers $9/hour than pay 60 workers $15/hour, making the remaining 40 workers completely unemployed.

 

Works Cited:

“Raising Minimum Wage: A Help Or Harm?" NPR. N.p., 8 July 2012. Web. 28 Feb. 2016.

Hazlitt, Henry. Economics in One Lesson. Three Rivers Press, 1979.

Picture link: http://www.thefederalistpapers.org/uncategorized/hilarious-bernie-sanders-meme-reveals-the-horrifying-truth-about-socialism