21 July 2023

Gender Pay Gap ideology

This is a story about a yoghurt manufacturer. This yoghurt manufacturer makes excellent yoghurt. So much so that the firm now has a dominant market share. Having become hugely successful, the yoghurt manufacturer decided to employ a marketing director. The marketing director announced that, as the company had become dominant, it no longer needed to focus its advertising on product quality, and should switch to virtue signalling. It was decided that this should be done in two main ways, one to do with the environment, the other to do with gender.
   With regard to the environment, it was decided that the company should abandon plastic lids, and leave people to rely on the film covering. This, the company announced, would avoid many tonnes of plastic waste. Instead, people could apply to the company for a reusable lid. However, this required customers first to collect points on their phone by scanning QR codes on the yoghurt tubs. Unfortunately, this scanning technology often failed. Also, for many months the company was out of reusable lids; however, it assured customers that the lids would soon be back in stock, and to "keep checking back on the website!" Meanwhile, supermarkets delivered many lidless tubs of the yoghurt to customers. A significant percentage of these tubs were damaged in transit due to lack of lids, leading to spillage of yoghurt over customers' deliveries, and resulting in much wastage of food. However, those losses were outweighed (from the company's point of view) by its enhanced public image.

With regard to gender, the company smugly announced on its website that it was working hard to reduce its "gender pay gap" (GPG), providing statistics to prove this was indeed the case. Since no target GPG was mentioned, readers were left with the implication that the most desirable level of GPG would be zero, and that this was what the company was aiming at. Readers were also left with the impression that a non-zero GPG was somehow morally wrong.

* * * * *

Treating a gender pay gap as an automatic negative, thus implicitly calling for action to reduce it to zero, is not about making sure that a woman doing the same job as a man is paid the same as the man. It is — in effect — about arranging that women do the same jobs as men. In other words, if there are four company directors, two of them should (it is implicitly demanded) be women. If there are six secretaries, three of them should be men. If there are two cleaners, the gender split should again be 50:50. That seems the more obvious way of eliminating the GPG, by equalising proportions.
   The less obvious way of eliminating the GPG would be to equalise pay between different jobs. If directors, secretaries, cleaners, and other jobs were all paid the same hourly rate, the gender pay gap would disappear, because everybody would receive the same rate of pay.

The idea that the female members of a company’s workforce should, on average, earn exactly the same per hour as the male members rests on a particular theory of gender differences. Namely, that they should not exist.

* * * * *

Let's start by clarifying the terminology. Discussions about whether women have a greater or lower level of X than men, where X is some characteristic such as intelligence or management skill, are befuddled by the fact that talking about differences between populations requires a different approach from talking about differences between individuals. We can say "women have Fallopian tubes, men do not" without much risk of error, but saying "women are shorter than men" is misleading. What is really meant is:

average-height-of-women has a lower value than average-height-of-men.

If you want to abbreviate this, you could write it as:

{women} are shorter than {men}

where curly brackets round the word "women" indicates that what is meant is "the average woman" or "the population of women, considered in terms of its statistical properties". Note that although {women} are shorter than {men}, there are many women who are taller than the average man.

The red (green) bell curve shows the distribution of men's (women's) height.
The shaded area represents women who are taller than the average man.

We could easily pick a group of tall women (call them T-women) and a group of short men (S-men) where we could say:

T-women are taller than S-men

without risk of being misleading, since every single T-woman would be taller than every single S-man. Similarly, we could easily pick a group of women ("alpha-women") and a group of men ("beta-men") where it would be fine to say "alpha-women are cleverer than beta-men" (meaning every alpha-woman is cleverer than every beta-man) — just as easily as it would be to do it the other way round, and find two groups where we could say, "alpha-men are cleverer than beta-women".

* * * * *

Having got that out of the way, the question arises:

Are {women} the same as {men}?

In other words: we know that men are different from one another, and that populations of them normally exhibit bell curves for any given characteristic (height, intelligence, artistic skill etc). Do {women} have exactly the same bell curve as {men} for every single characteristic? Or, to rephrase that, to exclude physical differences such as strength or height:

Do {women} have exactly the same bell curve as {men} for every innate characteristic relevant to white-collar jobs?

Prima facie, this is highly unlikely. Take any two populations that have been selected by two different criteria, and the chances that the two populations have identical averages on every one of a group of measures is extremely small. The probability of exact equality on a single measure is already very small — though if you sampled data often enough, equality of a single measure might happen occasionally by chance, especially if you have to allow for errors in measurement.

* * * * *

How then can it make sense to aim at zero GPG? We know that childcare (still) makes a difference to what women currently choose to do job-wise, so that is one reason we would not expect to see perfect equality between the jobs that {women} and {men} do. Even if we allow that some of what happens is not due to innate differences, but the result of cultural factors, so that in theory things could be different, the assumption that:

innately, {women} and {men} are identical in terms of all preferences and talents

is without empirical support, and a priori highly implausible.
   Of course, that doesn't imply {women} are less intelligent [or: insert other required employee property] than {men}. Depending on how you define intelligence, for example, it could well be that {women} are more intelligent than {men}. The chances that {women} are exactly as 'intelligent' as {men}, however, can safely be taken to be negligible.

The requirement for UK firms with more than 250 employees to calculate and publish their gender pay gap data came into force in 2018. The legislation was invented by Labour but its implementation was resisted by the Conservatives for some years, until David Cameron's pledge in 2015 — to "end the gender pay gap within a generation" — triggered its go-ahead via the Small Business, Enterprise and Employment Act.
   Employers do not have a legal duty to take action to reduce the gap. However, the requirement to publish their figures is clearly intended to put pressure on firms to find ways to make the gap disappear — regardless of whether it's efficient for them to do so.