Women Seen Closing the Wage Gap : But Study Says Gains Contribute to Poverty, Family Splits

Women’s earnings are catching up to men’s far faster than the common wisdom suggests, argues a new Rand Corp. study being released today. Yet women’s economic progress, the study says, is contributing to the breakup of the traditional family and the “feminization” of poverty.

The report by economists James P. Smith and Michael Ward--who raised a furor 4 1/2 years ago with an earlier study they conducted on women’s pay--projects that by the year 2000, women on average will be paid at least 80% of what men earn, up from 65% currently.

At the same time, they warn policy-makers to recognize that rising wages draw women into the work force and discourage child bearing--trends, they say, that destabilize the traditional family, contributing to rising divorce rates and the growing number of families headed by women.

And since it is among those female-headed families that poverty increasingly is concentrated, they say, leaders need to consider whether policies that encourage women to work are having unintended negative consequences.

Previous Controversy

“One price of the very labor market success women have enjoyed may well be a less stable American family,” says the study, which appears in the current issue of the Journal of Economic Perspectives.

Smith and Ward triggered controversy with their previous study challenging the widely held view that women had made few gains in closing the “wage gap” during most of the 20th Century. In fact, they said, women’s wages had risen more quickly than men’s from 1920 through 1980 and promised to continue narrowing the difference through the end of the century.

Critics disputed their conclusion that discrimination was not a major factor in the lowering of women’s wages and that government efforts to eliminate discrimination had done little to improve most women’s standing. The initial indication is that the new study, though it takes pains to acknowledge the importance of government attention to correcting the inequities women face in the economy, will incur feminists’ wrath as well.

Molly Yard, president of the National Organization for Women, said Tuesday that the narrowing of wage differences between men and women is more the result of a decline in men’s earnings, rather than any gains by women.

“Guys who used to be in the steel mill earning $11, $15, $20 bucks an hour are now down to $5 bucks an hour, so of course women in comparison to them are doing better than they used to,” she said.

Claudia Wayne, executive director of the National Committee on Pay Equity, said even the smaller wage gaps projected by the Rand economists were unconscionable.

“Even if it were true that the wage gap was going to be 80% in the year 2000, there’s still 20% missing that needs to be addressed,” said Wayne, who heads the Washington-based coalition of women’s, labor and civil rights groups.

Smith and Ward’s argument that women’s participation in the work force correlates with the increasingly feminine cast of poverty drew especially indignant responses.

Susan M. Christopherson, a professor of city and regional planning at Cornell University in Ithaca, N.Y., said the women entering the work force in the largest numbers are mothers of young children--a group that is working not out of choice, but rather to combat poverty or sustain family living standards.

“To suggest that women entering the labor force is related to the disintegration of families is very unfair to those women who are entering the work force in order to maintain sufficient family income,” she said.

Smith and Ward write that other studies have understated women’s earning gains by failing to take into account the fact that, in the past, many women entering the labor force had few skills and less-than-average education. Such women workers got low wages, pulling down the overall average of women’s earnings.

Their analysis, by contrast, finds that women have steadily been gaining more skills and education over time--gaining faster, in fact, than men--as the U.S. economy has paid less for men’s skills in such areas as manufacturing.

Leadership Gains

The constant narrowing of the differences between the capabilities women and men bring to the job has had a dramatic effect in the 1980s, the study says. In 1980, women’s earnings were 60% of men’s. But by 1986, women were earning 65% of what men earned--”the largest and swiftest gain witnessed in this century,” Smith and Ward write.

The gains, they predict, will continue. Not only will women’s earnings continue to rise more quickly than men’s, but women will take their place in leadership positions in the economy.

“The new women professionals of the last 10 years are now gaining partnerships in law firms, staff postions in major hospitals and middle management jobs in business,” the study says. “The sheer numbers in the pipeline guarantee that 20 years from now, some of these women will be senior partners, chiefs of staff, CEOs.”

In an interview Tuesday, Smith said the study’s findings argue against “massive public policy actions” to right injustices against working women.

WOMEN’S WAGES

Hourly wages as a percent of men’s wages

1968: 58.5 1976: 60.0 1980: 60.5 1986: 65.1 2000: 80.0

Percent of women who are poor

1940s: 50.0 ‘50s: 51.0 ‘60s: 55.0 ‘70s: 60.0 ‘80s: 62.0 Source: Rand Corp., Associated Press