Dear WorkRise community,
March is Women’s History Month, and labor experts and advocates are rightfully focused on persistent wage disparities between women and men despite laws against gender discrimination. A deeper dive into these gaps reveals even greater inequities in wages earned by Black, Latinx/Hispanic, and Indigenous women and those earned by white women and men. Our column this month highlights new research focused on gender pay gaps. We include a new US Department of Labor (DOL) report that quantifies the cost of occupational segregation—which has kept women of color out of good jobs—and outlines remedies for addressing this key driver of wage inequality. We also share a study that uses real-time data to show the expanded child tax credit (CTC) had no meaningful negative effects on labor force participation among families who received it.
Is there research we should elevate or a topic we should explore that sheds light on workers’ economic mobility? Write to us at apyati@urban.org.
New Research
Wage inequality
“Flexible pay” and gender wage disparities: A new peer-reviewed study by economists Barbara Biasi and Heather Sarsons finds that a 2011 Wisconsin law, known as Act 10, giving public school districts more flexibility in setting teachers’ pay through individual negotiations resulted in lower salaries for women compared with men with the same credentials. Broadly speaking, Act 10 limited collective bargaining, or the ability of unions to collect dues, and introduced performance-based pay incentives. Published in the Quarterly Journal of Economics, the study finds that Act 10 created wage gaps between male and female teachers by requiring teachers to individually negotiate their salaries with school districts instead of relying on collective bargaining agreements. A key determinant in wages was an individual teacher’s willingness to negotiate their salary. A survey of Wisconsin public school teachers fielded by the researchers found women were 12 to 23 percent less likely than men to have negotiated their pay during their careers and 31 percent more likely than men to say they don’t feel comfortable negotiating pay. The system of “flexible pay” appears to have penalized younger and less experienced teachers more than teachers with more seniority. Researchers also found the gender of school and district leadership influenced negotiating behavior: pay gaps were larger among teachers who worked for a male principal or superintendent and negligible among those who worked for a female principal or superintendent.
The cost of occupational segregation: More women than men lost jobs during the COVID-19 pandemic. Women of color bore the brunt of these layoffs because of their overrepresentation as frontline workers and in industries such as retail, hospitality, and care work that shut down or reduced hours or services. Certain occupations in education and health care were also vulnerable to elimination and more likely to be held by women of color. Women of color were also less likely to have job-related protections, such as paid sick or family leave to manage caregiving or remote learning of school-aged children. A new DOL report explores the causes and consequences of occupational segregation, where women and men and people of difference races and ethnicities are under- or overrepresented in certain jobs. Occupational segregation, a long-standing driver of racial and gender inequality in the labor market, predates and was exacerbated by the pandemic. The report quantifies the costs of occupational segregation in terms of lost wages: in 2019, Black women lost $39.3 billion and Latinx/Hispanic women lost $46.7 billion in potential wages because of the kinds of jobs they held relative to white men. The report proposes the following recommendations to combat occupational segregation and create more gender and racial equity in the labor market: 1) equalize education and training opportunities for women to enter higher-wage, male-dominated fields through apprenticeships and preapprenticeship programs; 2) increase access to policies that support caregiving, such as paid leave and child care; 3) empower workers to organize and bargain collectively to raise wages; and 4) improve enforcement of antidiscrimination and antiharassment laws.
Fiscal policies
Expanded CTC and parental employment: Families with children received advance monthly cash payments from July to December last year as part of the American Rescue Plan Act’s expanded child tax credit. The expanded CTC made significant reductions in child poverty and food insufficiency and helped families cover basic expenses and pay off debt. But there has been a debate among economists about whether a more generous child allowance or child tax credit discourages parents from working. Many studies have simulated the effects of a more generous child tax credit or allowance using economic models, but a new National Bureau of Economic Research working paper uses real-time data from April to December 2021 in the Current Population Survey and Census Household Pulse Survey to show that CTC payments did not have a meaningful impact on labor force participation among families receiving the benefit. The research team, affiliated with the Center on Poverty & Social Policy at Columbia University, found no significant difference in parental employment when comparing lower- and higher-income families.
Events and Announcements
Equity-focused research grants: The Department of Labor’s Chief Evaluation Office is accepting applications for its second annual Summer Data Equity Challenge competition for emerging and established scholars. Up to five winning teams will receive $30,000 each to use data to analyze how federal labor policies, protections, and programs reach traditionally underserved communities. Applications are due at noon (EDT) on April 11.
Topics in the News
Advocates push for pay transparency laws: As covered in the 19th News and CNBC, more states and localities are requiring employers to disclose information about salary ranges either with every job posting or during the hiring process. Some of these laws also prohibit employers from asking candidates for their salary histories. Both strategies could effectively close gender pay gaps, although research on them is limited because these laws are new. (A recent study of pay transparency laws in Canada’s public universities found they reduced wage disparities among men and women faculty.) Seven states and three cities—including New York City, most recently—have passed pay transparency laws. Other states, including Massachusetts and South Carolina, are considering similar legislation.
Eliminating degree requirements: Maryland Governor Larry Hogan announced this month that thousands of state government jobs would no longer require a college degree for an applicant to be considered. The State of Maryland is partnering with Opportunity@Work (a WorkRise grantee) to recruit skilled workers for thousands of well-paying jobs in information technology, customer service, and administration.
We want to hear from you! Do you have ideas for new and noteworthy research, events, data, or trends we should be watching and amplifying? Write to Archana Pyati at apyati@urban.org.