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Exploring Gender and Race Disparities in Workplace Earnings: Trends, Factors, and Government Initiatives

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  1. Topic 7 (Chapter 12) Gender and Race in Pay

  2. Table 12.1: Shares of the Civilian Labor Force for Major Demographic Groups: 1984, 1994, 2004, 2014

  3. Figure 12.1: Mean Earnings as a Percentage of White Male Earnings, Various Demographic Groups, Full-Time Workers over 24 Years Old, 2005

  4. Table 12.2: Female Earnings as a Percentage of Male Earnings, by Age and Education, Full-Time Workers, 2005

  5. Table 12.3: Female/Male Earnings Ratios and Percentages of Female Jobholders, Full-Time Wage and Salary Workers, by Selected High- and Low-Paying Occupations, 2005

  6. Table 12.4: Employment Ratios, Labor Force Participation Rates, and Unemployment Rates, by Race and Gender,* 1970-2005

  7. Table 12.5: Male Earnings Differences, by Ancestry, 1990

  8. Measured and unmeasured sources of earnings differences • Measured sources • Education • Experience • Working hours • Occupation • Unmeasured sources • Other characteristics (Quality, Language proficiency) • Social role (fat, ugly, bald, short) • Discrimination

  9. Theories of discrimination • Discrimination by employer, employees, and customer. • Employer discrimination: • MRP=Wm • Wf=Wm-d => MRP=Wf +d • Or d’=(Wm/Wf)-1 - Firm cannot maximize profits • Maximizing utility, U=U(taste, profit)? • Discrimination is greater if the minority group is a larger fraction of population

  10. Figure 12.2: Equilibrium Employment of Women or Minorities in Firms that Discriminate

  11. Figure 12.3: Market Demand for Women or Minorities as a Function of Relative Wages

  12. Figure 12.4: Effects on Relative Wages of an Increased Number of Nondiscriminatory Employers

  13. Figure 12.5: Effects on Relative Wages of a Decline in the Discriminatory Preferences of Employers

  14. Discrimination by employees and customers • Employees have discriminatory preferences  costly to employers, but so is getting rid of it. • Customer discrimination. cf) Statistical discrimination: part of screening problem. i) Employers use a group performance as a screening device. ii) Employers have more difficulty in finding the productivity of minority.

  15. Figure 12.6: The Screening Problem

  16. Figure 12.7: Labor Market Crowding

  17. Government programs to end discrimination • Equal Pay Act of 1963: outlaw separate pay scales for women and men (no mentioning equal opportunity) • Affirmative Action Plan of 1965: Equal employment opportunity plus required federal contractors to file action plans showing how they intended to increase employment of minorities.

  18. Table 12.6: Change in the Racial Composition of a 1,600-Person Job Group with Nondiscriminatory Hiring from a Pool That Is 12% Black (20% yearly turnover rate)

  19. Figure 12A.1: Estimated Male Comparable-Worth Salary Equation

  20. Figure 12A.2: Using the Estimated Male Comparable-Worth Salary Equation to Estimate the Extent of Underpayment in Female Jobs

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