True Measures: Female Pay

On the Dennis Miller Radio Show (podcast available for 4/8/2011), Thomas Sowell debunked the notion of a gender pay gap caused by systematic pay discrimination.

If you don’t accept the statistical argument — that when you normalize for pertinent factors like years of experience, hours worked, type of job and so forth then the gap isn’t really there — then try Sowell’s next argument.

At about 5:29 into the podcast, Sowell offers the following challenge to the gender pay gap.

If it really was true that a man and a woman of the same productivity, working the same job, that a woman is only paid three quarters of what a man is paid, the obvious inference is that another employer can hire four women for what this guy is paying for three men and he would have a tremendous competitive advantage that would probably drive [this guy] out of business.

Nice point.   That would give the other employer 33% more productivity for the same price.  In the business world, differences in productivity of 2 – 3% over time can separate  winners and losers and open and close doors.

A 33% productivity advantage would result in enough dominance to overcome discrimination barriers for many business leaders.

Comparing gross numbers like wages can be like comparing apples and oranges.  Sowell’s argument suggest that if a true pay gap exists, it isn’t due to gender discrimination.

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