Effects of Gender Wage Discrimination on Women

The Effects of Gender Wage Discrimination on Life of Women

Contents

Introduction

2. Literature Review

2.1. Need for Equal Pay Act and its Impact

2.2. Problems faced by Women

3. Conclusion

4. References

Abstract

This research is a review for some studies which are focused to highlight discrimination in payment between male and female members. The studies present the data collection methods such as surveys and interviews. All the studies showed that the discrimination in payment against women still exists, but there is a significant decline in the gender wage gap particularly because of the increasing awareness and enforcement of Gender Equity Act. The studies showed that the women recently have gained more experience and higher education which declined racial discrimination against the women. The studies also noted that the women have the right to get equal pay like that of men. Similarly women deserve to have the same employment opportunities as of men.

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1 Introduction

The equal pay act was signed on the 10th of June 1963 by the President John F. Kennedy (U.S. Equal Employment Opportunity Commission, 2014). The enactments of this act were to support and amend the Fair Labor Standards Act in 1938. This Act gave attention to unfair practices in paying low wages to female employees than males for the same job. John F. Kennedy highlighted the importance of the Equal Pay Act as “While much remains to be done to achieve full equality of economic opportunity for the average woman worker earns only 60 percent of the average wage for men this legislation is a significant step forward” (John F. Kennedy Presidential Library and Museum, 1963).

Kelly Jeanetta, founder of Kelly A. Jeanetta Law Firm LLC, said that the women are still getting only seventy percent of total wages earned by men for the same jobs. She further argues that due to unexamined biases and favoritism systems men are getting higher wages than women which has negatively affected the lives of women (Jeanetta, 2013). The goal of the Equal Pay Act of 1963 was to achieve equality in wages paid to both men and women at workplace. Furthermore the Act was approved keeping in consideration the objective to prevent the discrimination and biasness in jobs and pays in the private sector. Previously a negative notion existed stating that men should get more wages than women if they are on the same job and have same responsibilities. However this shows the obvious discrimination in disbursement to men and women.

Jeanetta (2013) further pointed out the law that was enacted in Minnesota in 1969 about Equal Pay for Equal Work, which prohibits employers to discriminate between employees in paying who are doing the same work, the same effort and the same efficiency. This law is a good model to reduce the difference in wage payment between man and woman, and the employer who pays wages on the basis of sex difference is a violation of the law of equality in pay. However to fully implement the rules and regulations of this Act, continuous work is required to be done. Government and NGOs must step ahead to ensure that wages are paid equally to both sexes.

The aim of this research is to understand the need for Equal Pay Act and the improvements in the gender wage discrimination during the course of history. Furthermore the paper attempts to find if discrimination exists in disbursement of wages to men and women. Also the research aims to highlight major problems faced by the women with the low wages than their counterparts.

2 Literature Review

2.1 Need for Equal Pay Act and its Impact

The basis of Equal Pay Act was to eradicate the discrimination of wage between men and women during the course of their job. Several researches have been conducted to analyze the importance of Equal Pay Act and improvement in the wage distribution as a result of the increased enforcement of the law. Suh (2009) investigated determinants and characteristics of changes in the gender wage gap in the United States of America between 1989 and 2005. The study found that the wage gap between men and women reduced during the study period, from seventy four percent to more than eighty percent. The results of this study show that women tried to close the wage gap by education, working hours and increased experience. This study also concluded that decreasing gender gap is also the result of diminishing level of wage discrimination in the labor market. Although with the passage of time the improvement in the wage gap between men and women occurred, still the distribution is far from equality.

Regarding the economic impact on lives of the women due to low wages, the study shows that certainly the economic condition of women was improved as human capital development became the reason for better wages. According to Neumark decomposition the majority of increasing discrimination is because of the increase of influence of men in the workplace (Neumark, 1988).

Jake Rosenfeld and Meredith Kleykamp (2012) used the current population survey between 1973 and 2007 to find out the impact of African-Americans to reduce the wage gap in the private sector, and how African-Americans worked with unions to protect themselves from discrimination in the private sector. The survey showed that wage gaps between women, black-white are thirteen to thirty percent lower. The study showed that the important role played by Union to reduce racial inequality (Rosenfeld & Kleykamp, 2012).

Patrick Mason (2011) presented the paper which studied the changes in the concept of ethnic Americans during the post-Jim Crow era, the study included American families between 1965 and 2006, and the differences between the U.S. region, especially the South. The study noted that men and women regardless of their racial difference, have different opportunities in society and the market and likewise the remuneration also differentiates (Mason, 2011).

The study also showed that Oaxaca-Ransom decompositions found there is a big reduction in payment discrimination against African Americans especially for those between the ages of 50 and 59, women are more practice racial equality faster than men. The study also showed that the reduction in the Southern racial disparity is reason for the national improvement among men (Mason, 2011).

According to a study carried out by both of Rafael Lalive and Alois Stutzer (2009), women get paid lesser than men for the same work, and the level of their satisfaction with their jobs are lower than men. But the study showed that the wage discrimination against women has decreased significantly, and that’s because the high awareness of the act of equal pay between men and women, in addition to experience factor which the women have from the labor market.

The reduction in the gap occurred during 1970s due to immediate attention toward the wage discrimination after the resolution of Equal Pay Act. Increase in jobs opportunities in the U.S. labor market occurred during this period because of higher qualification of women.

Many European countries have evolved towards decentralization and to determine the minimum wage, which address the problem of the wage gap gender. “In several European countries the gender pay gap has a low profile both in the public debate and in the policy agenda. Summarizing, one of the main problems is that there is no real owner of the problem, as nobody really feels responsible for closing the gender pay gap. Organizing political support for closing the gap seems to be an important challenge for the near future.” (O’Dorchai, 2008).

Liqin Zhang and Xiao-Yuan Dong (2008) used the data from Chinese company to analyze the wage discrimination between male and female in China’s industry. The results of the study showed that there is a relation between low wages for women, and weak production for female workers compared with male workers. The result of this study showed that the women who worked in the public sector get wages equal to the men, but the women who worked in the private sector more like to discrimination in wage. The study noted that the Chinese woman status in the deterioration because of discrimination against them from employers in the private sector, in addition to the failure of the public sector to the protection of women, and failure to impose policies and laws against discrimination in wages.

“In the service sector, women do not encounter gender wage discrimination in state-owned enterprises but do suffer from discrimination in private-owned enterprises. The public sector pays more attention to advocating gender equality while managers of private enterprises have more discretionary power to act out their prejudice against women in wage-setting and employment policies”( Zhang and Dong, 2008).

A group of researcher: Ariane Hegewisch, Hannah Liepmann, Jeffrey Hayes, and Heidi Hartmann (2010), they presented a paper to prove the existence of discriminatory wage between the gender by analysis of occupational data during the 1970 and 1980s, and the study noted that can be seen from the occupations that does not require high levels of education, and the jobs which required especial degree.

2.2 Problems faced by Women

Discrimination in the pay between men and women is no doubt troublesome for a large population of US workforce, mainly consisting of women. Glynn (2012) says that 50% of all workers of U.S. payrolls are women and majority of them are single mothers working outside their homes. In order to support their families the single mothers and other women are required to have adequate payments. Furthermore gender pay gaps and the discrimination hinder the women to progress up to the top level management positions in the organizations. Even if female workers are qualified and experienced they are paid lesser than their male counterparts. Apart from the single or married women the female workers who are unmarried are also getting lower wages. Recently graduated female staff members are usually paid less than other female staff. Organizations on the other hand save a big chunk of their income by paying less to the female workers.

The study noted that the European women are suffering from difficulty in earning with low wages and the discriminatory practices from employers. The study suggested to impose a three polices to protect woman from discrimination at work, first equal pay policies, the legal frame is not the problem, but the problem is enforcement of this policy, second wage policies and third equal opportunities policy.

Women are also paid less because they are considered to be best suited for pink collar jobs which offer lesser benefits than other white collar jobs. Furthermore position of women in white collar jobs which demand effective decision making skills is very limited. Few organizations offer top management positions for the women.

According to Boushey, Arons, and Smith, among the 19 million families in USA women are the main breadwinner for their families, which makes the women bear the brunt of keeping their jobs and take care of family. Whereas the man is more prone to lose his job, which means that millions of families now rely on a woman’s job to make ends meet. This shows that women’s jobs are more critical for their families than men (Boushey, Arons, and Smith, 2010) and getting paid lesser is no doubt extreme level of discrimination.

Nowadays the American parents working very hard to take care of their kids and cover their bills, and women try to find a good job with a good payment to help her family to cover the requirements of family life. So, the discrimination in wage could have a negative impact not only on her life, but also on her family life, “Nearly two-thirds of mothers are either the breadwinner for their family or share that responsibility with a partner. Women’s earnings therefore are vital to their families’ economic well-being” (Glynn, 2012).

3 Conclusion

Previous researches and articles included in the research helped to analyze the facts and figures of the discrimination. Furthermore study of the Equal Pay Act shows how payment discrimination was reduced and more awareness is spread about its implementation. Equal Pay Act helped to reduce the unfairness in the wage disbursement to both men and women.

From the studies we can see the reduction in racial discrimination in wages, especially against women. And that’s because the increase awareness of the Equal Pay Act. The studies showed that The United States and European Union countries are more pursuant to the Equal Wages Act than Eastern European countries and China. The studies also confirm the importance of supporting of the Equality Act, and make it effective in order to protect women from discrimination and give women the right to equal employment opportunities.

The study showed major problems faced by the women when they are paid lesser than their counterpart male workers. As statistics show that women share major portion of US workforce the discrimination of pay has negative impact on their economic condition. Furthermore single, married and single moms face trouble as they are main contributors in the family. Considering the economic and social problems faced by the women due to discrimination in the wages, the need for a strongly established law is obvious. Federal agencies need to play vital role in the establishment and implementation of equal pay system to both sexes. This research can also be extended further to see why organizations do not appoint women in top managerial positions.

4 References

Alksnis, C., & Desmarais, S. (2008). Workforce Segregation and the Gender Wage Gap: Is “Women’s” Work Valued as Highly as “Men’s”?1. ournal of Applied Social Psychology, 1-6.

Bacolod, M. P., & Blum, B. (2010). Two Sides of the Same Coin U.S. “Residual” Inequality and the Gender Gap”. Journal of Human Resources, 198-242.

Glynn, S. J. (2012, August 16). Fact Sheet: The wage Gap for Women. Retrieved from American Progress Organization: http://www.americanprogress.org/issues/labor/news/2012/08/16/12029/fact-sheet-the-wage-gap-for-women/

Hegewisch, A., Liepmann, H., Hayes, J., & Hartmann, H. (2010). Separate and Not Equal? Gender Segregation in the Labor Market and the Gender Wage Gap. INSTITUTE FOR WOMEN’S POLICY RESEARCH.

Jain, T. (2008). Equal Pay for Equal Work . ICFAI Journal of Employment Law, 1-27.

Jeanetta, K. A. (2013). Equal Pay for Equal Work. The Hennepin Lawyer.

John F. Kennedy Presidential Library and Museum. (1963, June 10). Remarks on signing Equal Pay Act of 1963. Retrieved April 27, 2014, from John F. Kennedy Presidential Library and Museum: http://www.jfklibrary.org/Asset-Viewer/Archives/JFKPOF-045-001.aspx

Mason, P. L. (2011). Moments of Disparate Peaks: Race-Gender Wage Gaps Among Mature Persons, 1965–2007. Rev Black Polit Econ, 1-25.

Neumark, D. (1988). Employers’ Discriminatory Behavior and the Estimation of Wage Discrimination . The Journal of Human Resources, 279-295.

O’DORCHAI, S. (2008). DOWOMEN GAIN OR LOSE FROM BECOMING MOTHERS? A COMPARATIVEWAGEANALYSIS IN 25 EUROPEAN COUNTRIES. Brussels Economic Review, 1-7.

Rosenfeld, J., & Kleykamp, M. (2012). Organized Labor and Racial Wage Inequality in the United States. American Journal of Sociology, 1460–1502.

Stutzer, A., & Lalive, R. (2004). APPROVAL OF EQUAL RIGHTS AND GENDER . Leibniz-Informationszentrum Wirtschaft.

Suh, J. (2009). Decomposition of the Change in the Gender Wage Gap. Research in Business and Economics Journal , 1-18.

U.S. Equal Employment Opportunity Commission. (2014). The Equal Pay Act of 1963. Retrieved April 28, 2014, from U.S. Equal Employment Opportunity Commission: http://www.eeoc.gov/laws/statutes/epa.cfm

Zhang, L., & Dong, X.-Y. (2008). Male-female wage discrimination in Chinase industry . Economics of Transition, 85-112.