Is Discrimination Responsible for the Earnings Differences

Between Men and Women?

1. The labor force participation rate of women has risen from 37.6% in 1960 to 60.6% in 2002.

2. The hourly earnings of full-time working women were approximately 80% of those of men in 2002.

3. Until recently, more than ½ of all women were employed in just 4 occupations – clerical workers, teachers, nurses, and food service workers.

4. Women have tended to seek jobs with more flexible hours.

5. The male/female earnings differential was just as large between single males and females as between married males and females, strongly suggesting that employment discrimination is responsible for the earning difference.

TRUE or FALSE

6. By 1968, the majority of females 14 to 24 expected to be working at age 35.

7. Since 1970, the proportion of degrees in economics and engineering earned by women has fallen, while the proportion in veterinary medicine and accounting has risen. 8. The 1962 equal pay legislation and the 1964 civil rights legislation resulted in a substantial increase in the earnings of females relative to males during the 60s and 70s. 9. The earnings of women is expected to continue to rise relative to the earnings of men in the near future. 10. When employment discrimination results from the personal prejudices of employers, economic theory suggests that employers who discriminate will have higher costs than employers who do not.

TRUE or FALSE

Employment Discrimination and Earnings of Women

• The labor force participation rate of women has steadily increased for several decades.

Since 1980 the earnings of women have been rising relative to men.

• The earnings of women remained around 60 % that of

men during the 1960’s and 1970’s.

Share of females age 20 and over in the

labor force (right scale)

Female/male annual earnings, full-time workers (left scale)

1965 1970 1975 1980 19851960 1990 199550

55

60

65

70

35

45

55

75

85

77.0

60.4

2000

65

75

2005

Employment Discrimination and Earnings of Women

• The earnings of married female workers are about ½ those of married men. The earnings of single female workers are about 81 percent that of single men.

• The earnings of full-time married female workers are 69 percent that of full-time married male workers.

69 %

Median female/male annual earnings ratio (%), 2005

Full-time, full-year workers:

100 %

58 %

81 %

76 %

69 %

Never Married

Total

Married (spouse present)

Total

Married (spouse present)

Never Married

All workers:

Possible sources of earnings differences between men and women:

1. Employment discrimination2. Specialization of roles within the family has

traditionally caused gender differences in educational choices & types of jobs held.- Women typically worked jobs with more

flexible and shorter hours and within occupations where skills were transportable across employers.

3. Continuity of work force participation - maternity leave, child care, and ___________

• Does this help explain the rising earnings of women relative to men since 1980? • What are the implications of this trend for the future earnings of women relative to men?

• The career goals and educational choices of women have changed dramatically during the last 35 years.

The Changing Workforce Objectives of Women

1970–71

0.8 1.2 2.4 7.3

7.8 9.2

10.1 11.2 12.0 25.2

Engineering Dentistry Optometry Law Veterinary medicine Medicine Accounting Economics Architecture Pharmacy

Field of study 1987–88

15.326.134.340.450.033.052.632.838.759.7

2000–01

19.938.654.547.369.845.360.534.135.866.1

Women as a Proportion of PersonsEarning Selected Professional Degrees, Selected Years

2004–05

19.943.861.548.775.647.359.731.938.867.5

• Women have constituted an increasing share of college graduates.

• Today, almost three of every five graduating seniors are women.

• Does this indicate that colleges discriminate against men?

Women as a Share of Persons Graduating from College: 1961-

2006Female Share of College Graduating Classes

1961 1970 1980 1990 2000

39 %43 %

49 %53 %

57 %

2006

58 %

Due by next class:

page 715 Question 3