The More Education, the Wider the Gender Pay Gap—Wait, What?

By Chris Winters, Yes! Magazine

08 August 17

Seattle women make less than men, but especially those with advanced degrees.

ou might think that one of the major urban centers of the Left Coast would be more progressive on ensuring wage parity between women and men in the workplace. You’d be wrong. In general, women in the greater Seattle area make just 78.6 cents for every dollar their male counterparts make. That’s on par with the national average.

But here’s where the numbers get crazy.

The 78.6 cents figure comes from the American Community Survey, an annual poll conducted by the U.S. Census Bureau. Seattle company LiveStories mined the survey data for patterns that weren’t immediately obvious.

“There’s been a real discussion around gender gap and pay,” says Adnan Mahmud, LiveStories’ founder and chief executive. “We wondered if there was data in our library that would prove or disprove this data.” The company’s business is to make data from large public databases such as the Census more accessible. In one sense, the gender pay report was selected as a way of showcasing the startup’s technology.

Then they found a surprise hiding in the data: The gender-pay gap in Seattle nearly inversely correlates to women’s level of education.

In other words, the higher the degree a woman has, the larger gap in pay exists between her and men with the same level of education.

Seattle women with just a high school diploma or equivalent make 84 cents for every dollar earned by men at the same educational level. The gap increases from there: College graduates make 72 cents to the man-dollar, and women with graduate or professional degrees make 68 cents to the man-dollar.

That’s not a universal trend: LiveStories compared Seattle with Baltimore, Boston, Denver, and Nashville—all cities of similar size—and found that the effect was most pronounced in Seattle.

One factor may be the local technology industry, which is largely male and has produced an enormous amount of wealth in the area. But Boston also has a vibrant technology industry, and it doesn’t show the same increase in pay disparity at higher education levels.

“In Seattle, you wouldn’t expect that gap to widen. In tech, you’d think there’s a desire to be seen otherwise,” Mahmud says.

One problem in understanding this gap-within-a-gap probably stems from the fact that the gender pay gap exists for many reasons in the first place.

According to the Pew Research Center’s analysis of 2015 ACS data, U.S. women earn about 83 percent of what men do. That’s improved since 1980, when women earned just 64 percent of what men did.

Two major factors in the gap can be attributed to parenting or other familial responsibilities, which traditionally have fallen to women, and educational and occupational choices.

In the first case, the “motherhood penalty” manifests in interrupted careers, reduced working hours, and decreased future earnings. The disparity in choice of profession exists in part because occupations that typically skew male, such as engineering or finance, pay more than those traditionally seen as “women’s jobs,” such as teaching and social services.

But the disparity exists even within those women-dominated professions. Women make up 77.7 percent of the workforce in the personal care and services sector, for example, and still make 77.8 percent of what men in that profession do.

Neither of those factors taken singly or together accounts for the entire gender gap.

The American Association of University Women’s study, “The Simple Truth About the Gender Pay Gap,” highlighted that even after accounting for “college major, economic sector, hours worked, months unemployed since graduation, GPA, type of undergraduate institution, institution selectivity, age, geographical region, and marital status, AAUW found a remaining 7 percent difference between the earnings of male and female college graduates one year after graduation.”

That 7 percent difference is likely only explainable by discrimination and bias. (It’s hard to prove because discrimination is identifiable only by the absence of parity after excluding all other explanations.)

That gender disparity transcends racial boundaries, although the largest difference is when comparing White women to White men: the women make 79.6 percent of men’s earnings.

When comparing women and men of other races, the disparity narrows. Asian women make 81.5 cents for every dollar made by Asian men, for example. For Native Hawaiian or Pacific Islanders, it’s 83.8 cents, for Native American women, 87.2 cents, and for Black women, it’s 90 cents per dollar. Hispanic/Latino women make 92.2 cents per dollar.

Better parity within those ethnic groups is at the cost of increased inequality across races: Black men make just 74.4 percent what White men do, so that 10-cent difference within the Black community still starts from a baseline 25 percent below what White employees make.

Another clue may lie in the ACS state rankings for gender wage gap, in which Washington ranks 25th out of all 50 states plus the District of Columbia.

That showing isn’t great, and the AAUW report points to some possible contributing factors, including that Washington is one of 14 states with comparatively weak equal pay laws, while 28 states have what it calls “moderate” laws, and only six have “strong” laws. (Two states, Alabama and Mississippi, have none.)

What makes a law strong include rules that prohibit employers from asking about salary history (as in the case of Massachusetts), limiting the number of excuses to not pay men and women equally (California), prohibiting “mommy tracking” into lower-paying jobs or career paths (Maryland) or imposing high fines or damage payments on violators (Tennessee). Among states with weaker laws are Louisiana, where they only apply to public sector employees, and Arizona, which doesn’t prohibit retaliation against employees who take action.

None of this quite gets at what makes Seattle an outlier for highly educated women. Is it a factor of the technology industry, Washington state’s labor law, or something else. There is no easy explanation.

“We don’t have one right now,” Mahmud says. “We thought that, because we were surprised, we thought other people would be surprised too.”