While there might be a select few that believe there is no instance of discrimination in a post-racial society where an African-American president was elected, most people recognize that some form of prejudice will always exist. It is natural for the human mind to draw distorted views based on limited observation. For instance, the short kid with crooked glasses; outdated clothes; and shy nature will normally not be picked first on a playground basketball game. However, looks can be deceiving and he could surprise with wizardry dribbling skills and a potent outside shot. The same can be said within society where some people resort to stereotypes that consciously or sub-consciously lead to hiring practices that wrongly penalize women and minorities. The question is to what extent do our prejudices explain the gender and racial gap, which is not as straight forward as it looks.
In order to prove discrimination, some believe statistical disparities offer enough proof. Harvard economist Ronald Fryer attempts to explain the reasons for the black-white wage gap that shows blacks earn wages that are 30% less than whites. While that appears to prove that racial discrimination still exists, there might be a reasonable rationale behind the pay disparity. As detailed by Dr. Fryer’s study, a portion of this difference is due to differences in human capital. However, his findings suggest that a third of the gap can be attributed to labor market discrimination, thus suggesting that government intervention is still necessary.
Then there is the issue of the gender wage gap. Anna Chu and Charles Posner of Center for American Progress reports that women earn 77 cents for every dollar paid to men. There are wide disparities among states with the best equity occurring in Vermont and the widest disparity occurring in Wyoming.
While both appear to suggest that a healthy amount of discriminating activity is taking place, there is another side to the equation. June O’Neill of the American Enterprise Institute offers an alternative reason for the disparities for both race and gender.
Dr. O’Neill attributes most of the racial wage gap to human capital differences. While acknowledging the advances made by African Americans in various fields, she believes that there are variances in cognitive skills between races. For instance, Dr. O’Neill cites evidence that shows that blacks score approximately 100 points lower than whites on various components of the college preparatory test (SAT). Also, a separate Armed Forces Qualifications Test showed that pay differences can be explained through divergent scores on cognitive skills. Lastly,when correcting for these human capital differences, she maintains that there is minimal differences in pay.
As for gender pay, Dr. O’Neill believes the wage differentials are a result of family choices, rather than discrimination or human capital differences. While there has been improvement where women now earn approximately 81 percent as much as men compared to 59 percent in 1960, this current gap is due to career disruptions as women are more likely than men to leave the labor force temporarily to raise their children or work part-time. If that is the case, then that can explain why efforts, such as the Civil Rights Act of 1964 and federal anti-discrimination regulations have not been able to fully close the gap.
Even though it is encouraging to see the gains made by women over the last few decades, a Brookings report from Richard Reeves and Joanna Venator shows that additional concerns remain. Despite the gains in college degrees and pay, women remain less mobile than men. This means that they are more likely to earn less than the families they grew up in. They suggest that one possible reason for this is that women are more likely to be single parents than men. Therefore, addressing family composition and encouraging marriage before having children could narrow the gap.
Alternatively, Jane Ferrell and Sarah Jane Glynn of Center for American Progress infer that labor market discrimination of women is still present. Their study suggests that differences in gender pay go beyond family choices and infer that discrimination can be a factor. Their assertions are supported by data showing that 41.1 percent of wage differences are unexplained, thus legislation, such as passing the Paycheck Fairness Act where employment discrimination faces stiffer penalties and a lower burden of proof, is critical.
While the racial and gender gap remains persistent today, opinions vary on cause and course of action. If labor market discrimination remains prevalent, then affirmative action or anti-discriminatory measures remain the best course of action in addressing any racial or gender wage deficiencies. If the racial gap is primarily due to human capital differences, then emphasis should be placed on education and labor force development strategies, rather than burdensome regulations. If the gender gap is due to personal choice, then further legislation would not be necessary since their decisions are voluntary and unrelated to bias.