On the same day as General Motors picked Mary Barra as its first female chief executive, the Pew Research Center came out with a report entitled “On Pay Gap, Millenial Women Near Parity, For Now.”
Have women finally made it in the workforce? Well, yes and no. Yes, because hard working American women have the same chance of success as hard working American men, as Barra’s example shows us.
No, because according to the Pew survey, 51 percent of women have interrupted their careers for family, and those who chose this route “overwhelmingly say they are glad they did this, even though a significant share say it hurt their career overall.”
Women have equality of opportunity. But because not all make the same choices, they do not yet have equality of outcome, measured in terms of the percentage of CEOs, board directors, and construction workers who are female. Since women are unlikely to ever make the same choices as men, equality of outcome will never happen, contrary to the wishes of some feminist groups such as the National Organization for Women and the American Association of University Women.
Take a look an incoming GM CEO Mary Barra. She began working at GM as a college intern, and got an engineering degree, paid for by GM. Fewer than 20 percent of engineering degrees awarded go to women. Then, she remained at the same company, moving up through the ranks. She found time to get her MBA at Stanford, paid for by GM. In fact, 46 percent of MBA degrees awarded go to women.
Later, Marra was appointed head of human resources, a position that corporations frequently give to women, but not the route to becoming a CEO. She moved to head GM’s global product development, putting herself into consideration for the top job. Negotiating for a promotion takes ambition, and guts. It is much safer to stay in the same job, especially when it is head of human resources for GM.
Women have the same opportunities as men if they want to pursue them. In this economic recovery, women are doing better than men. Since December 2007, the beginning of the recession, the number of employed women has declined by two tenths of 1 percent, while the number of employed men has declined by 2.26 percent.
But many women choose other avenues. That is why, on average, women earn less than men do, and fewer women reach the top in corporations.
Choice of majors
Although in 2012 women earned 61 percent of associate’s degrees, 58 percent of bachelor’s degrees, 60 percent of master’s degrees, and 52 percent of doctoral degrees, women choose different majors from men, according to data from the National Center for Education Statistics. Women were awarded 68 percent of English degrees and 79 percent of education degrees in 2012, compared to 43 percent of math degrees and 19 percent of engineering degrees.
Choice of jobs
Once in the job market, women choose different types of jobs than men. Fewer go into investment banking, for instance, and more go into the nonprofit sector. For example, 88 percent of social workers are female, compared to just 19 percent of software developers, according to the Bureau of Labor Statistics.
Choice of hours worked
When women work, they work fewer hours than men. About a quarter of women have historically worked part-time. In November, it was 24 percent. When women work full-time, they work 7 percent fewer hours than do men.
The Pew Center’s analysis of Census Bureau data finds that women between 25 and 34 make 93 percent of men’s earnings. This wage gap does not reflect choices of jobs, hours, or time in the workforce.
When these factors are accounted for, econometric analysis by many economists — including Columbia University professor Jane Waldfogel, University of Chicago professor Marianne Bertrand, and City University of New York professor June O’Neill — find that all women, not just millennials, make about 95 percent of men’s earnings.
The remaining 5 cents could be due to unmeasured variables, or to discrimination. Women who believe that they are victims of discrimination have many legal avenues to sue their employers, the most recent being the Lilly Ledbetter Act, the first bill signed into law by President Obama in 2009.
This gap is far smaller than the 77 percent frequently mentioned in speeches by the president. But even in the White House in 2012, female staffers made 87 cents on a man’s dollar, according to the 2012 Annual Report to Congress on White House Staff.
Just as women surveyed by Pew reported they were glad that they took time off work, women at Yale Law School are already thinking ahead to family-friendly flexible jobs. This year, for the eighth year in a row, Yale Law Women highlighted the top 10 family-friendly firms. These are not firms that pay the most, but those whose benefits include part-time work, flexibility in hours, and paid maternity leave.
Family-friendly has advantages, but it does not usually lead to the CEO’s office. That takes 60 to 80-hour weeks and a lot of travel. When some of the brightest young women in the country start out looking for family-friendly jobs, they are cutting off some options, as Sheryl Sandberg, chief operating officer of Facebook, describes in her book “Lean In: Women, Work, and the Will to Lead,” published earlier this year.
A choice of shorter hours at the office and more time at home is not a policy problem — not for men and women who want more family time, nor for those who want to retire early.
Differences in pay and position stemming from women’s choices are not a reason to pass more workplace pay discrimination regulations such as the Paycheck Fairness Act, sponsored by Representative Rosa DeLauro (D-CT) and Senator Barbara Mikulski (D-MD). These differences are not a reason to require quotas for women on boards of directors, as is being discussed in Europe.
But it follows from these choices that women will never be half of CEOs or board directors, or even half of construction workers or grave diggers. Mary Barra shows that women can make it to the top. The Pew study shows that many women are equally happy with lower-paying, flexible careers.
Diana Furchtgott-Roth, former chief economist of the U.S. Department of Labor, directs Economics21 at the Manhattan Institute. You can follow her on Twitter here.
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