Dana Goldstein asks:
And speaking of money, how come auto workers are unionized, but house cleaners and hair dressers aren't? How come research continues to show that even when we control for maternity leave, time off of work, and different levels of education, women still make only 70 cents on the male dollar?
Ezra points out:
I quite agree with Dana. The patriarchy lives! That said, the reason auto workers are unionized while hair dressers aren't has much more to do with the legal and cultural moment when the unions launched their organizing drives against the auto manufacturers, and the differences in organizational structure between hair salon employees (diffuse, lots of small businesses) and manufacturing employees (concentrated, large amounts of machinery which create value outside of the worker). Part of the reason unions are having such trouble organizing is that various laws have made organizing tougher, and beyond that, it's simply harder to unionize service sector employees, and when you do, there are fewer gains to distribute, as each individual worker's labor creates comparatively little value.
He fails to point out that that "70 cents" figure is decades out of date; it's now 80 cents, and rising, and nearly disappears when you control for work experience and hours. He also doesn't point out that where women did work in factories, they were also unionized: You may have heard of the International Ladies Garment Worker's Union, which used to be one of the largest unions in the United States. It's also rather sexist to assume that their hairdressers are women; most of the male blue collar workers I've ever met had their hair cut by male barbers.
Then Ezra, inexplicably, says this:
So salon workers aren't unionized for much the reason that truckers aren't unionized, and for much the reason that only 7 percent of the private sector workforce is unionized. Things just aren't going that well for the unions. Which is a shame. Particularly for salon workers, who, as The Nation usefully explains, really need some regulatory help.
There are about 2.8 million truckers in America. Roughly 10% of them are self-employed, mostly as owner-operators. There is also a trucking union, known as the Teamsters, that covers 1.4 million people, though not all of them are truck drivers. Truck driving is a comparitively well unionized industry, though perhaps not compared to the days when Jimmy Hoffa could snap his fingers and extort bribes from practically any company in the country.
How come research continues to show that even when we control for maternity leave, time off of work, and different levels of education, women still make only 70 cents on the male dollar?
This betrays a rather feeble understanding of the way markets actually work. In general businesses don't care about race or gender or sexual preference--they care about profits. And they will higher whichever employees will bring in the most profit. That's why, as Ms. McArdle says, after controlling for work experience and hours women and men make the same salaries. The market rewards talent without passion or prejudice.
"Part of the reason unions are having such trouble organizing is that various laws have made organizing tougher, and beyond that, it's simply harder to unionize service sector employees..."
I'm glad the unins are in decline. Unions represent a conspiracy, by some workers, to extract wages in excess of their parginal productivity. So insiders benefit at the expense of outsiers. What has GM's union accomplished over the years?
All of the workers who would have liked to work for GM even at wages lower that the union wage have suffered. All of the older people who were counting on GM stock for their retirement have suffered. All of the GM customers (and indeed all car buyers) who have paid a higher price for their cars have suffered. And why? All so a bunch of people who already amke high wages can make even more money. If that isn't greed I don't know what is. It's a shame that the government wastes its time going after Microsoft and gives the unions a pass--they are far more pernicious monopolies.
A note on hiring: Some will ask, "but what about employers who hate women, or blacks or whatever group. Won't they discriminate?" Yes, they will, but they will pay a heavy price for it. Their competitors will get the benefit of all those employees the prejudiced employers turn down, and will therefore gain a signficant competitive advantage. Thus the free market punishes the stupid, narrow and prejudiced without any help from the EEOC.
The guys Megan quotes have just a shocking lack of knowledge of actual conditions in the fields they are talking about. Cleaners and hair stylists have options that GM workers don't. No matter how well paid a GM worker is, he can't start his own plant, even if his closes. Cleaning service employees eventually strike out on their own to develop a private clientele. I don't know much about salons, but a lot of salon workers also seem to strike out and start their own, which is particularly effective since customers often develop loyalty to the person rather than the salon and want a particular person to cut their hair. And they wouldn't necessarily need a lot of overhead--I know of a hair stylist in DC who was famed for the fact that she would come to homes and give haircuts to the whole family. Moms loved the convenience.
Today unions are at their strongest among public-sector employees. Women probably make up a higher percentage of total employement in the public sector than in the private sector, especially industry.
In some states, hairdressers may not be unionized but there is an attempt to limit the number of hair and nail salons through licensing. Of course, the only one I can think of is Louisiana. I have also heard of some states requiring florists to be licensed.
Megan: I believe the "ladies" in the ILGWU refers to who wears the garments (ladies garments) not the sex of the people making the garments.
Isocrates: You have a point, but "This betrays a feeble understanding of how markets actually work" should have the addendum "[actually work] in econ 101 textbooks." You talk about a broad theoretical apparatus that describes how markets operarte under particular [often restrictive and quite unusual] conditions as if that were markets actually work in practice. Have you ever studied industrial organization? Moreover, how markets work and how businesses work are two very different matters. Lots of businesses have been very successful while practicing racism and discrimination.
Your posts sometimes seem to go from supporting capitalism as a system to worshiping it as a religion.
Umm, no, it was the first majority women's union. Read the link.
Have you ever studied industrial organization?... Lots of businesses have been very successful while practicing racism and discrimination... Your posts sometimes seem to go from supporting capitalism as a system to worshiping it as a religion.-Gene
Next you're going to tell me that there are market failures like asymmetric information, third-party effects (or externalities), etc... Yes, I know. I'd be willing to bet that I have studied a great deal more economics than most of the people who comment here. More even than the blogger herself (which I do not intend as a slight, just a fact--indeed Megan is usually quite astute when she writes about economics).
My main point is that there are powerful forces in a free market that punish people for discriminating irrationally against certain groups. If Microsoft, for example, decided it didn't want to hire talented women, then its competitors would gain a huge advantage. Google, Sun, Apple, etc... would all benefit from Microsoft's stupidity.
There are some, like Naomi Klein, who like to identify free enterprise with oppression and discrimination. It's that notion I wish to expose as inconsistent with the way in which markets actually function.
As for me worshipping free markets as a religion, I think you must have missed my posts supporting stiff carbon taxes to address the negative externalities associated with pollution and greenhouse emissions. Moreover, though I haven't commented on it here, I have no use for the more extreme market clearing models that are fashionable in some economic circles. New Classical economics seems to me deeply flawed because it assumes a Walrasian marketplace with perfectly rational and farsighted participants. And Real Business Cycle Theory does not seem to me to agree with the empirical evidence on economic fluctuations.
So, since I am well aware of the various sorts of market failures and and prefer neo-keynesian models that admit wage and price rigidities, I think any reasonable person will not agree with your assertion that I am what Stiglitz calls a "free-market fundamentalist."
RE ILGWU: you are right, I mistook your point
I did not intend to imply that your knowledge was shallow, rather that you propound the theory as if it were data. Japanese firms have done quite well while discriminating against women [and non-Japanese]. Country clubs and some other establishments continue to do so. Etc. etc.
Whatever the possible connection of "free markets" and oppression, history seems to indicate fairly clearly that private ownership plus non-representative government, with the common filip of a peripheral country, does indeed lead to oppression by ownership of workers, including very specifically limits on the rights of workers to organize collectively. The rejoinder that the markets in this case are not in fact "free" is correct, but has the drawvback of blaming the facts for not fitting the theory.
Probably because this “research” apparently didn’t control for occupation. I’m sure a lot of people would be just shocked to discover that in general doctors make more than nurses, specialists make more than general practioners, engineers make more than English teachers, etc.
Also this “research” doesn’t seem to control for the years of experience in the relevant field nor does it appear to control for what field of education (e.g. engineering as opposed to English literature) instead of just what level.
Isocrates: I agree with your broader point: any claimed "underpayment" implies an arbitrage opportunity, and the larger it is claimed to be, the more implausible. If women really are forced to sell their labor at a 30% discount, despite being the exact same quality, no one would hire men.
Nevertheless, discrimination, as used by the leftists you're refuting, can persist, even in ideal markets with perfect compeittion. Specifically, if the discrimination is functioning as *alternate compensation* for other workers. i.e. Someone could rationally "overpay" for male workers if it means getting to "underpay" for employees to work with them.
***
And please tell me I'm not alone here: Why does it seem that the lower your IQ, the more likely you are to say "cents on the dollar" instead of "percent"?
If Microsoft, for example, decided it didn't want to hire talented women, then its competitors would gain a huge advantage. Google, Sun, Apple, etc... would all benefit from Microsoft's stupidity.
I work for one of the Fortune 50 and we have an aggressive and pervasive diversity program. Upper management have been quite clear that we can't afford to discriminate on anything but work performance. Management has part of their bonuses tied to improving results on the company diversity surveys, so those of us that do interviews have been briefed to look past the usual stuff as well as hairstyles, tatoos, piercings, etc. to competence as the key in hiring.
"...history seems to indicate fairly clearly that private ownership plus non-representative government, with the common filip of a peripheral country, does indeed lead to oppression by ownership of workers..."
I don't think so. Any kind of dictatorship is likely to curtail freedom significantly but I'm not sure what private ownership has to do with this. China was a dictatorship under Mao and is a dictatorship now. But were the Chinese less oppressed wehn they had a communist economy or are they less oppressed now?
They are much better off now than they were then. They are generally freer, richer and happier. No sensible person could say that capitalism has caused more oppression in China.
IIRC, in Thomas Sowell's book Preferential Policies, he cites the original 70¢ study as showing that unmarried, childless, college-educated women over 35 as making $1.03 for every dollar made by men in the same demographic.
Even so, the entire argument that women make less than men because of gender can be easily rebutted by reasoning out the implications. I mean, does anyone honestly believe that greedy business would forgo a 20-30% cut in their payroll expenses just so their employees had peckers? My employer sure as hell wouldn't. If it were true that businesses could somehow get away with paying female employees almost a third less than comparable male employees, I don't think there would be an unemployed woman in this country. At the same time it would be almost as impossible to find an employed man.
yours/
peter.
I'm not sure if Ezra's aware, but salon workers who cut women's hair and develop a loyal client base, can make a lot of money -- more money than a UAW worker. Of course, there is an element of merit in salons that is lacking in the UAW: if you're an unpleasant person, you won't make it up from shampoo girl. But any woman who goes to a non-Super Cuts place to get her hair done -- the sort of place that charges $60+ per haircut -- will tell you that her hairstylist is doing pretty well. These women have a higher ROI from their salon school training than most white collar cubicle dwellers do.
Incidentally, this is part of a broader trend among many on the left to downplay the economic opportunities of those in trades, and continue to push college-for-everyone as a panacea. In truth, lots of folks are better off not going to college.
Wow. That was a really really really bad column by Dana Goldstein. Pretty much every fact in there was wrong, starting with the data she cites (as Megan points out, it's both out-of-date and out-of-context), and continuing from there.
No, in a democracy the government isn't supposed to "reflect" the population. It's supposed to represent the population. There's no more reason for it to be 50-50 men and women than it should have 5% teachers and 5% athletes and 10% people who studied Spanish in high school and 3% farmers and 7% people who think they've seen UFOs. (Yes, I know those categories overlap; the numbers are made up anyway, just to illustrate a point.) Goldstein, one assumes, is Jewish; I wonder if she thinks that there's something wrong with Congress because there are "too many" Jews in Congress by her "reflect the population" standard.
No, we don't have waiting periods on abortion because politicians are men; despite what she "learned" in Women's Studies classes at Brown, the anti-abortion movement is not composed of men who want to oppress women. There is no significant difference in the US in views on abortion policy between men and women; many surveys show women to be slightly less pro-choice than men.
And when she asks "When was the last time the state told him he wasn't fit to make a medical decision without thinking it over just a few more times? ," she might want to learn what the FDA is. It tells everyone they're not fit to make medical decisions.
And the Supreme Court did not "decide last spring that women and people of color should be severly limited in filing complaints against such pay discrimination?" The Supreme Court doesn't -- not when it's doing its job -- decide what "should" be; that's Congress's job. the Court decides what the law says. The law it was interpreting, incidentally, applies to men as well as women, but had nothing to do with the ridiculous phrase "people of color."
But whether or not the decision was right, the implication that it came out that way because most Supreme Court justices are men is embarrassing. To Goldstein, not to the Supreme court. She shows about as much understanding of the legal issues as one would expect from a Brown major in European culture with a focus on gender.
Unions arose where there was a real imbalance in bargaining power between individual workers and large industrial plants. The companies were too big to be able to negotiate individually with workers, and with transportation limited to walking and trains, it often wasn't practical to just get a job elsewhere. The situation with such occupations as hair stylists is entirely different - if you think one employer is treating you unfairly, there are plenty of other shops to apply at, and if you think you are worth more than the average worker, you can try to demonstrate that directly to a shop manager with the authority to set pay and conditions, or you can start your own shop.
The trouble with unions is, the union movement wasn't content with merely establishing parity in bargaining power, but rather they wanted to form and exploit labor monopolies, and often to introduce socialism under union rather than government control.
For instance, rather than a GM workers union that could negotiate with GM on an equal basis, they formed the UAW, representing workers at GM, Ford, Chrysler, and several companies that no longer exist. With a nationwide monopoly on automobile assembly labor, they once held an advantage over even the Big Three. If Ford looked weakest this year, they would strike at Ford, with dues and additional collections from workers at GM and Chrysler to support the strikers - and Ford not only losing large amounts of money, but also losing customers since there were no new Fords arriving at dealer lots. When Ford folded, the UAW would then work on the others one at a time until they had the same deal across the board. In the 1960's, you could make almost the same pay sweeping the floor at a Big Three plant as teaching at a public school in Michigan - not because unskilled labor had anywhere near the real market value of a college-degreed and certified teacher, but because strikes cost even more than overpaying the workers, and the American auto companies could count on the union equally handicapping their domestic competitors.
(All that blew up in 1973, when OPEC cranked up oil prices so high that despised but fuel efficient imports started selling - and the UAW finally had competition. Huge layoffs ensued, and a good many UAW members with low seniority had no real chance of being hired back until the more senior members retired. Excessive greed will come back at you someday...)
As the son of a Teamster, I'm still laughing at the "truckers" comment. Why is it that those who presume to speak for the working class have no clue whatsoever about the life of those they claim to champion?
most of the male blue collar workers I've ever met had their hair cut by male barbers.
Those living in the real world meet many blue collar working men every day. Those who don't have time to ask such strange creatures about their tonsorial habits.
"There is also a trucking union, known as the Teamsters, that covers 1.4 million people, though not all of them are truck drivers."
Yeah, no kidding, "not all of them." Secretaries in the Medical School at the University of Chicago are Teamsters.