Pay gaps, computers, and the public sector

By Eric Crampton 08/04/2014

The NZ EEO Commissioner, Jackie Blue, is unhappy about the gender wage gap in the public service.

The woman in charge of equal employment opportunities is set to “crack the whip” on government departments for failing to close the gender pay gap.

Women in the public sector are paid an average 14 per cent less than their male counterparts, despite making up 60 per cent of the sector’s workforce, according to analysis by Equal Employment Opportunities Commissioner Jackie Blue.

“I’m very unhappy with the public service. They should be doing much better than they are. They’re not taking it seriously – some are, but many aren’t.”

Preliminary analysis by Dr Blue’s office of structural discrimination across 29 government departments shows little has changed in the two years since the last survey.

The gender pay gap was greater in 21 departments than the labour market average of 11 per cent. Seven had a gap of more than 20 per cent, including the Treasury and the Department of the Prime Minister and Cabinet.

The most recent American work suggests that the pay gap that remains after correcting for differences in education and time out of the workforce is largely due to gender differences in valuation of non-pecuniary benefits like flexible work environments and differences in the rewards for putting in long hours.

Paul Walker notes Claudia Goldin’s excellent AER Presidential Address on the topic. I had a chat with Kathryn Ryan on Nine To Noon a couple of months back about the empirics around natality and baby bonuses; I’d then suggested she might have a chat with Claudia Goldin. Goldin was on with Kathryn a couple of weeks ago, discussing the evidence on the gender wage gap.

While there’s the general impression that the public sector is pretty 9-to-5, a lot of the senior bureau staff and senior analysts will be putting in rather more than that. It isn’t implausible that the same differences found in the US will be driving things here. The Herald piece notes that much of the public service pay gap comes down to different occupational choices:

“The reality is the gender pay gap in the public service is heavily influenced by the relative pay rates in occupation groups where women are over-represented, such as clerical and administrative roles, contact centres and social, health and education workers,” [Deputy State Services Commissioner] Ms Beatie said.

It could be useful for the EEO Commissioner to listen to Kathryn Ryan’s interview with Claudia Goldin.

In related news, a new paper in the AEJ: Applied Economics [ungated] suggests that much of the decline in the US gender wage gap comes from the rise in PC adoption. Manual labour, more frequently undertaken by men, drops in value; returns to education rise.

0 Responses to “Pay gaps, computers, and the public sector”

  • “differences in the rewards for putting in long hours” – can you clarify this? Why should there be gender differences here?

    • The data shows women are less likely to put in as long of hours at the office. So long as that’s the case, and so long as more hours are worth disproportionately more to employers because their clients put high value on having a single person to contact, then we’ll get a pay gap based on willingness to put in longer work hours, work weekends and the like.

  • See the Goldin AER piece. She writes “But it must involve changes in the labor market, especially how jobs are structured and remunerated to enhance temporal flexibility. The gender gap in pay would be considerably reduced and might vanish altogether if firms did not have an incentive to disproportionately reward individuals who labored long hours and worked particular hours.” A lot of the demand for “temporal flexibility” by women comes from family commitments. Goldin also discusses this point in the interview with Kathryn Ryan.

  • “then we’ll get a pay gap based on willingness to put in longer work hours, work weekends and the like.”

    The something needs to change surely. Aren’t long hours correlated to more stress, more death, more divorce, lower “quality of like” (an all that that means!).

    Convince me why imposing this regime on women is a good way of shrinking the pay gap and I will watching for the pigs to fly.

    Women aren’t stupid.

    • Ross, where did you read me saying anything about imposing anything on anybody?

      If the world is such that, in some professions, customers put really high value on having particular persons dealing with them rather than “a member of our team”, and if men are more willing than women, on average to make themselves available for long hours or on call, then there will be a gender wage gap. It is a positive statement backed by the evidence. It also has normative implications. IF you want to reduce the wage gap, and IF the positive statement reflects reality, some popular policies will be counterproductive or, at best, costly and ineffective.

  • Sh*t my typing is getting bad.

    The = then
    like = life
    will = will be

  • Like Ross, I fail to see how having women – or indeed, anyone! – work longer hours or in weekends is actually benefiting either the individual or society. Tired, stressed workers are surely more of a liability to the firm than a benefit, quite apart from the workers’ quality of life.

    • Well, you might think that, but that firms provide extra hourly compensation to those working longer hours in particular industries is evidence that those firms see some benefit in it.