Equal pay for equal work
To mark the centenary of The First World War, we will be publishing a series of articles looking at what has changed over the last century in a number of domains. Today’s post is by Monika Queisser, head of the Social Policy Division in the OECD’s Employment, Labour and Social Affairs Directorate.
Imagine a world where women are the ones repairing cars, driving buses, building roads and houses, mining coal, fighting fires and ploughing fields, with men nowhere to be seen. It sounds like Utopia, dystopia or highly unlikely, depending on your point of view. Even if girls often do better in school than boys there is still a clear-cut gender divide in the fields of study young people chose and in the areas of work they pursue. Boys are more likely to go for science, engineering and maths while girls probably pick health and the humanities.
A 100 years ago, however, this scenario of a female-dominated world of work, including in traditionally male professions, was the reality in much of Europe. With men having been called to war, women were filling their jobs to keep the countries running. In the UK, women’s employment rates just about doubled from 23% to 47% during the war, and munitions factories became the biggest employers of women (called “canaries” because the poisonous chemicals used to make TNT turned their skin yellow).
But even though women were doing what was considered men’s work, they were still only being paid women’s rates. Not that women weren’t bothered by the pay gap or political issues. As early as 1909, a mostly female led famous strike, called the Uprising of the 20,000, shook the garment industry in New York and spread further as more and more workers joined the picketers. In Russia, women played a major role in the strikes and revolts that led up to the 1917 revolution and already during the 1905 revolution, there were more women in the Assembly of Russian Factory and Plant Workers than there were men in all the socialist organisations in St. Petersburg combined.
In London, women working on buses and streetcars went on strike in 1918 demanding better pay. As a result, the question of the gender pay gap was studied by a special Committee of the British War Cabinet which published a Report on Women in Industry in 1919. The report was widely disseminated and even received an excellent review in the American Economic Review in its June 1920 edition. While the report endorsed equal pay for equal work it also found that for many occupations women’s output was lower than that of men. This justified paying female workers lower wages, which would also be better overall for women since paying women higher wages might actually reduce their employment. In addition, it found that women didn’t need to be paid as much as men since they had no family responsibilities, automatically assuming that any woman who was working must be single, although by 1918 nearly 40% of all women workers were married.
But the report was actually split in two: a majority report and a minority report by Beatrice Webb, a social rights campaigner who was also one of the founders of the London School of Economics. She forcefully argued against this and several other assumptions about women’s output and productivity.
The gender wage gap got governments worried about what would happen when the men returned from the battlefields and found their jobs taken by the women. These concerns turned out to be unfounded. When the men came back, many women were either fired or retreated back to home and hearth, leaving the work responsibilities to the men. And if they continued to work in the same factories they did so at lower wages while the men got better pay.
So what’s changed over the past century? About half of the economic growth in OECD countries in the past 50 years is due to increased educational attainment, particularly among women, but women still earn on average 15.3% in OECD countries. At the top of the pay scale, the gender gap is even higher, 21%, suggesting the continued presence of a glass ceiling. The average pay gap between men and women widens to 22% in families with one or more children. For couples without children, the gap is 7%. Overall the wage penalty for having children is on average 14%, with Japan and Korea showing the greatest gap.
The impact of pay inequality is dramatic over a woman’s lifetime. Having worked less in formal employment, but having carried out much more unpaid work at home, many women will retire on lower pensions and see out their final years in poverty. Living an average of nearly 6 years longer than men, women over 65 are today more than one and a half times more likely to live in poverty than men in the same age bracket. Mrs Webb would be appalled.