The Gender Pay Gap: A Closer Look at the Underlying Causes


The movement of women into the labor force has been referred to by some as the greatest social transformation of our time. In November 2010, approximately 47% of the labor force was female. More opportunities for women exist now than ever before, and the presence of women in a wide range of workplaces is common. Yet one issue that’s still being discussed is the gender pay gap.

The most commonly cited statistic in the current gender pay gap discussion is the “77 Cents” statistic: women earn 77 cents for every $1 earned by their male counterparts. This statistic is presented in nearly every discussion; it has been cited by White House Senior Adviser Valerie Jarrett, Acting EEOC Chairman Stuart Ishimaru, Secretary of Labor Hilda Solis, and various scholars, academics, consultants and practitioners. The “77 Cents” statistic has been used as supporting evidence in discussions ranging from abstract theoretical musings on the role of women in society to concrete policy proposals such as The Paycheck Fairness Act.

The current administration has given gender pay equity a high priority. An interagency task force on gender pay equity has been created, and one of their main objectives is to better understand the full of the gender wage gap.

All of the current administration’s work, however, is being driven by the “77 Cents” statistic and the assumption that the 23 cents-per-hour gender differential is attributable to gender discrimination. The “77 Cents” statistic does not accurately depict the real gender pay gap. It references the raw gender pay disparity, and does not consider the impact of legitimate non-discriminatory factors. When one examines the gender wage gap accounting for legitimate non-discriminatory factors such as occupational choice, industry, work experience, hours worked, the cash/benefits tradeoff, etc., the gender pay gap significantly narrows. In fact, there may be no gender pay gap at all.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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