SPEAKER: What went wrong, if you want to put it that way, in the 1990s? Why did the strong and consistent trend toward a narrowing of the gender pay gap falter? Unfortunately, we don't have the data to do a detailed study like the one I just presented for the 1980s. What we are especially missing that's important is data on labor force experience. That's absolutely crucial to a full analysis.
But in recent work, Professor Kahn and I were able to rule out some possibilities for explaining the difference between the 1990s and the 1980s. As best as we could measure it in a simple fashion, the difference between the two decades doesn't seem to be due to returns to characteristics. That is wage structure trends were no more adverse to women in the 1990s than they had been in the 1980s, so that does not seem to explain the slowing of convergence.
We also adjusted for the age and educational composition of male and female workers and didn't get any mileage out of that. This leaves us one possible explanation for the slowing of convergence in the 1990s, that women did not narrow the experience gap as much as they had in the '80s.
Looking at trends in male and female labor force participation, the possibility that women are narrowing the experience gap at a slower rate in the '90s than they did in the '80s becomes evident if we look at the chart on the right. The most striking trend shown in the chart is the difference in the participation rates of men and women has been narrowing considerably since the start of the chart, which is 1965.
This is due to a slow, steady decrease in male labor force participation combined with a much sharper and dramatic increase in female labor force participation. The decrease in male participation does not appear to be due very much to changes in gender roles, rather it primarily reflects the fact that men are retiring at earlier ages and are staying in school longer.
In recent years, another factor has been the weakening job market for less skilled men. While our chart begins in the mid-1960s, the large increases in female participation, in fact, date back to the 1940s. Interestingly, the trend toward rising female labor force participation was strong and consistent from the 1940s until about 1990. After that, the line becomes noticeably flatter. Women's participation increased a bit, but not very dramatically.
How did these labor force participation trends relate to the average experience levels of women workers? Unfortunately, you cannot figure this out just by looking at the participation rate shown in the chart. This is because the labor force participation of women can increase for either of two reasons or a combination of both.
On the one hand, participation may rise because a lot of new groups of women come into the labor market. This tends to lower the average experience of women workers because there are a lot of new entrants. On the other hand, participation can rise because women stay in the labor force more consistently over a period of time rather than moving in and out. This works to raise average experienced levels of women workers.
Research has shown that before 1980, the average experience of women did not increase very much because these two factors tended to balance each other out. There were a lot of new entrants and a lot of more women staying in the labor force more continuously. Thus, the average experienced levels of women in the labor market remained roughly constant.
In the 1980s, though, the increase in labor force participation of women was primarily due to more women remaining in the labor force more consistently and continuously. And as we've seen, the average experience of women workers rose accordingly. Thus, without additional data on experience, I do not know for sure what to make of this flattening of the trend in female labor force participation shown in the chart. It may indicate that the gender gap and experience decline more slowly in the 1990s than in the 1980s.
Let me pause here for a minute and say a few more words about these participation trends. The data we're looking at is on labor force participation rates. But really, what the trends show is an enormous change in gender roles in the family and in the labor market, and in the family, most importantly, a movement away from the traditional family of breadwinner husband and homemaker wife to a family where both husband and wife work outside the home, although not in all cases giving equal weights to each of their careers.
An economists named Ralph Smith call this process a subtle revolution. The trend suggests that this subtle revolution, having accomplished an enormous amount, may be slowing now. Is it stopping? Not necessarily, but we have reached a situation where looking at women in the prime working ages, that is 25 to 55, over 3/4 of them are in the labor force. This means that female participation rates in the United States are at very high levels, although still below the male rates that are about 90% in this age group. So it may not be surprising that of necessity, future participation trends will be less dramatic than past trends.
Returning to the question of why the gender pay ratio has not been rising so dramatically in recent years, another factor could be that discrimination did not decrease as rapidly in the 1990s as it did in the 1980s. Please note it's very important. I am not suggesting that discrimination increased in the 1990s. But what I am suggesting is that it may have decreased less substantially than it did in the 1980s. This makes some intuitive sense to me because I think to the extent that discrimination by gender still exists, it is much more subtle and unconscious than it was in the past.
Let me give an example of what I mean, though it predates the 1980s.
I'm a graduate of Cornell, and I was a student at the ILR School in the 1960s. At that time, there was a quota on women students limiting them to 15 out of about 100 places in the entering class. That restriction was by and large generally accepted without comment, but it was basically an open thing, and it could be changed when people's attitudes changed. More subtle discrimination is difficult to battle because it is so subtle and possibly even unconscious.
However, my own opinion is that such discrimination does change as women increasingly enter new areas and achieve success at higher levels. Putting it somewhat differently, while the glass ceiling may not have broken completely, it is showing a lot of cracks, and more and more cracks as time goes on. Where does all this leave us? What should we expect for the future?
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Francine Blau, the Frances Perkins Professor of Industrial and Labor Relations and Labor Economics at Cornell ILR School, describes trends in the gender pay gap, considers fundamental explanations for the gender pay gap and uses these explanations to understand the trends.
This video is part 7 of 8 in The Gender Pay Gap series.