News and Commentary

Nancy Pelosi Promotes ‘Wage Gap’ Bill, Saying That Women Are ‘Working For Free’ During ‘First Three Months Of The Year’ Compared To Men

On Wednesday, Speaker of the House Rep. Nancy Pelosi (D-CA) spoke about the alleged “wage gap” while delivering a speech on the floor of the House of Representatives regarding the “Paycheck Fairness Act.”

Pelosi stated:

Now, we’re proud to pass this bill before “Equal Pay Day,” which is on April 2, next week … which symbolizes when women’s wages catch up to a man’s earnings from the previous year. So, in other words, for the first three months of the year, most women are working for free compared to what a man will make in the overall year…

So, this is about respect. It’s about respect, my colleagues on both sides of the aisle. Respect for women, and the work that they do. And if they do equal work, why wouldn’t they get equal pay?

The text of the Paycheck Fairness Act, which passed the House 242-187 on Wednesday, reads in part:

Despite the enactment of the Equal Pay Act of 1963, many women continue to earn significantly lower pay than men for equal work. These pay disparities exist in both the private and governmental sectors. Pay disparities are especially severe for women and girls of color.

In many instances, the pay disparities can only be due to continued intentional discrimination or the lingering effects of past discrimination. After controlling for educational attainment, occupation, industry, union status, race, ethnicity, and labor force experience roughly 40 percent of the pay gap remains unexplained.

CNBC reports that the bill would force companies to justify to the Department of Labor any disparities between salaries paid to male and female employees.

Here’s the problem – many Democratic politicians and activists who speak about the alleged wage gap are taking a simplistic calculation of the annual wages earned by men and women working full-time, and extrapolating from that a disparity that is then blamed entirely on sexism.

The “77 cents on the dollar” talking point has been used for years, despite the fact that it’s been shown on multiple occasions to be deeply reductive.

According to a recent working paper from Harvard PhD candidates Valentin Bolotnyy and Natalia Emanuel, titled “Why Do Women Earn Less Than Men? Evidence from Bus and Train Operators,” the earnings gap in the fields examined boils down, in large part, to the different choices made by working men and women:

…the earnings gap can be explained in our setting by the fact that men take 48% fewer unpaid hours off and work 83% more overtime hours per year than women. The reason for these differences is not that men and women face different choice sets in this job. Rather, it is that women have greater demand for workplace flexibility and lower demand for overtime work hours than men. These gender differences are consistent with women taking on more of the household and childcare duties than men, limiting their work availability in the process.

The study found that two “policy changes” from 2016 and 2017 made a marked impact on the earnings gap between men and women in the fields examined. These changes related to unpaid time off and overtime hours policies:

Both policies reduced the gender earnings gap. The gap shrank from $0.89 before the FMLA policy change to $0.91 between March 2016 and July 2017 and to $0.94 from July through December 2017.

The authors continue, citing studies from multiple scholars that show various patterns, such as women choosing occupations that pay less on average; women being “less willing to compete for higher-paying positions”; and women being more likely to work fewer hours as a trade-off for a more regular schedule.

However, the authors do cite other studies showing that “in the lab, wage negotiators were found to mislead women more than men,” and women “have a lower probability of promotion than men” in certain fields.

In 2009, the Department of Labor released a study by CONSAD Research Corp, which, after accounting for variables surrounding women’s work field choices, the earnings gap “narrows to between 93 cents and 95 cents on the dollar,” reports Politifact.

In the study’s own language:

Statistical analysis that includes those variables has produced results that collectively account for between 65.1 and 76.4 percent of a raw gender wage gap of 20.4 percent, and thereby leave an adjusted gender wage gap that is between 4.8 and 7.1 percent.

As the American Enterprise Institute’s (AEI) Christina Hoff Sommers stated in a 2014 “Factual Feminist” video:

There was an analysis of more than 50 peer-reviewed papers commissioned by the Department of Labor. What they found is that the so-called “wage gap” is mostly, perhaps entirely, an artifact of the different choices men and women make – different fields of study, different professions, different balances between and home and work…

Sommers stated in another video pertaining to the “wage gap” that “when competent economists look at all these variables and consider them, the wage gap narrows to the point of vanishing.” While Sommers doesn’t discount the idea that gender discrimination exists, she notes that any residual pay disparities that studies have found cannot be conclusively linked to “sexism” due to an extraordinary number of variables.