Morning Must Reads: The Gender Pay Gap

This morning, the Reading Eagle does a nice job summarizing Berks County and Pennsylvania data on the gender pay gap. One important note, a certain amount of differences in earnings can be explained by variation in what economists call productivity-related characteristics — things such as education and experience. When you make adjustments for this, the gender pay gap is somewhat smaller but still present and meaningful. The bottom line, the unadjusted gender pay gap data from the U.S. Census Bureau, which the Reading Eagle presents, remains a reasonable guide to the state of gender pay equity.

Nationally women are paid 78 cents to every $1 paid to men...

The gender pay equity gap has slowly narrowed since passage of the federal Equal Pay Act of 1963. The rate women earn compared to men has increased on average about a half-cent per year.

Today the average salary for an American woman is $36,551 while the average man's salary is $46,500, according to the latest census figures.

In Pennsylvania, the average woman makes $26,410 while a man averages $39,758.

In Berks, the average woman is paid $25,802, and men average $39,926.

Although compensation for all workers rises based on the level of education, a high school diploma, college degree or even graduate degree does little to close the gender pay gap, census figures show.

Nationally, a man who has finished high school earns an annual average of $31,376 while a woman who has graduated from high school makes $21,427. That's 68 cents for the woman to the man's $1. The average man with a bachelor's degree earns $57,815 while a woman earns $40,393, or almost 70 cents to every $1 earned by a man.

Because statistics don't make for easy morning reading, you need filler, typically commentary from local experts on what the data mean. This story relied heavily on commentary from an investment banker from Wells Fargo:

[Angel L.] Helm, an investment banker and director at the Reading branch of Wells Fargo Bank, said women may get paid less in janitorial work or on a loading dock, where they physically can't do work a man can, but in finance it's all about performance. "I can only speak about the finance world, but performance and experience, and not gender, are what matter," said Helm, who has 28 years in the business.

"I started with American Bank and have survived six mergers," she said. "In my experience if you produce you get paid."

Helm said she recently researched the issue for a talk she gave to the Greater Reading Chamber of Commerce & Industry and concluded that women who get a college or advanced degree such as an MBA are more likely to meet or exceed men in business.

The leading source of data and analysis in this area is the Institute for Women's Policy Research (IWPR). In April of last year, IWPR released a fact sheet on the gender wage gap by occupation. If you read the fact sheet, you will note that typically it is in the highest-paying occupations that the gender wage gap is the greatest. Also, as a contrast to Helm's claim about financial services being a sector where pay equates to performance, I thought the following from the IWPR fact sheet was interesting:

The four occupations with the largest gender wage gap are (female/male earnings ratio and full-time median weekly female earnings in brackets): ‘Personal financial advisors’ (58.4 percent; $962); ‘securities, commodities, and financial services sales agents’ (62.7 percent, $892); ‘retail sales person’ (64.7 percent; $421); ‘property, real estate, and community association managers’ (65.35 percent, $726).

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