Supply for labour will increase when:
- There is an increase in the number of available workers due to demographic changes
- Taxes are reduced or a minimum wage is set which gives people incentives to look for work.
- Conditions deteriorate in one market making another industry look more attractive
Each worker has a unique factor of production with a unique sat of characteristics. Wage rates are usually determined by:
- Part of the country you live in
- The amount of hours you do (part time and full time)
- The skills and education required
- The type of shift you do (night shifts etc)
Factors can affect if you are employed or if you are given a lower wage. Discrimination occurs when an employer offers you a lower wage than another worker with the same abilities and skills as you, to carry out the same task. There are many forms of wage discrimination including:
- Age
- Sex
- Ethnic Background
So why are women paid less?
Before the war, the majority of men within the working age were employed and it was very rare to see women working. In those times, it was the ‘women’s job’ to stay at home, prepare the dinner for her husband and tidy the house. During the war, those roles changed. The majority of the male population were away fighting for their country, and the women were left to take care of everything else. They had to work in shops and factories producing goods for themselves and for the army to use in the war.
Since the war, the amount of women in work has gradually increased. Although the wage gap has tightened, it still has not closed completely.
The Equal Opportunities Commission published that women in the UK are only paid an average of 82% of a male average hourly rate causing women to earn approximately £241,000 less than men over her career for doing the same jobs. Female part time workers only receive 61% of men’s average full time wage. This is the worst wage gap in Europe. In the Netherlands, part time females earn 7% less than their male full time colleagues. In Australia, female nurses are earning 18% more than males across the workforce.
In the UK the wage rates alter depending where you are but the difference between male and female wage rates do not alter much. These alterations are due to living costs such as house pricing etc.
The problem still persists that women are paid less than men. Some economists consider that this is due to women being denied the same educational opportunities as men in the past and so lowering their level of human capital. Another reason may be because the majority of women take primary responsibility of bringing-up their children. There is also the possibility that women of childbearing age, will want to take maternity leave if they become pregnant. Employers will have to pay maternity leave to the mother to be as well as the temporary staff who would continue with the work. New mothers will also take up to 2 years of work to look after their child. Taking this amount of time off work could result in missing out on formal training, informal knowledge, new methods of training and any new developments in technology and making slower for women to climb the success ladder. This means that when they look for a new job or return to where the were working, they will be less informed to make decisions about the market and increase their job potential. There is also the possibility of mothers having to leave work if their child is felling unwell at school and needs to be sent home. Some women are even declined a job if the employer knows she wants to start a family in the near future. Women are also less likely to become part of Trade Unions, which could help boost their wages.
Jobs that are dominated by females (e.g. secretary) usually have low a MRP.
In 1999, the six most prevalent occupations for women were
- School teachers (except post secondary teachers)
- Secretaries
- Cashiers
- Miscellaneous managers and administrators
- Sale supervisors
- Qualified nurses
One quarter of the women’s working population are employed in these occupations. Apart from miscellaneous managers and administrators, it has been argued that women choose these occupations because they require less skill and they can have more time at home for other responsibilities. As they have a low MRP, they are paid less than managers, which have higher MRP values and are usually men.
If men were given the choice of working part time the majority would consider not working at-all. This is because men find part time work too degrading. A-lot of women do not mind part time work as it helps them earn a bit of cash and they also have some free time. Part-time workers are likely to hold less responsible job and so earn less on average than full-time workers. Women working part time would lower the average wage rate for women. As not many men work part time, the average wage remains remains higher than women’s. From the 1995 figures from the Labour Force Survey, of the 11.5M women in work, 44% worked part-time. Whereas only 13% of working men were in part-time jobs. Also of the people unemployed, there were 4 women to every 1 man looking for a part time job. In 1998, 5.4M out of a total of 12M female workers were part-time. This compared to 1.3M out of the 14.9M male workers.
For women, part time or temporary work can be a stepping-stone to their career. But men who begin their working lives this way, never seen to achieve the same salaries compared to men who start their career in permanent full time jobs. This may be another reason why men do not take part time jobs.
Apparently men believe that women are not ambitious enough so aren’t rewarded by promotions in the same way that men are. Research by Professor Alison Booth shows that women are just as likely to receive a promotion as men across the whole range of occupations. But once promoted women tend to get lower pay increases than men.
Due to the Equal Pay act 1970 and the sex discrimination act of 1975, the gap between men and women’s wage rates has narrowed. It is now illegal to pay a woman less than a man if they are doing the same job. However, women can be paid less than men, in a job with the same skills and responsibilities, because they are given different job titles and their roles seen inferior.
There is a narrowing in the wage gap but it may caused by a decline in men’s real earnings and a levelling off of women’s real earnings, when adjusted for inflation. This is due to men losing jobs in the mining and steel industry, and having to go into jobs in the service sector of the market, which has a lower wage rate. In 2000, the wage gap narrowed by 1% due to men’s earnings falling and women’s earning levelling off. The introduction of the minimum wage has helped close the wage gap. The minimum wage has had much more effect of women’s pay as there are far more women in low paid jobs than men.
In the Sunday times pay list 2000, it gave the top ten male and female earners. The top male earner was Bernie Eccleston with an annual earning of £617m. On the other hand, the top female earner was J K Rowling earning a much lower £25m. There is a great difference in real earnings here. Does this follow the pattern of the differences in wages in the economy? Or is it a coincidence that that the top male earner earned considerable more than the top female earner? This evidence shows that male’s may be paid more due to the fact that they tend to be more ambitious, and so are more likely to sell their selves for the occupation and wage rate they desire.
Differing wage rates at Cardinal Wiseman R.C School
I have decided to examine the pay patterns at Cardinal Wiseman School and compare my data with the national trend. Using a number of job ads I was able to find the pay scale. The finance officer helped me figure out the number of hours each employee at the school worked.
I took the staff members from Cardinal Wiseman School and analysed their wage rates to see if there was any difference in the pay structure. I was able to find out the amount of male and female staff and what their job title was. I was unable to find out their exact wage rate but using the pay structure for qualified teachers I was able to calculate their wage. I was able to access the number of responsibility points for each individual and assumed that each employee had reached the top of the scale in terms of experience. I knew which members of the teaching staff were assistant heads, deputies and the headmaster, so I could assign them to the correct pay scale.
As you can see, in the areas of the teaching population, the average male wage is
higher than the average females. Overall there is 118 staff at Cardinal Wiseman School, 72 of which are female. With the majority of employee being women, you would expect that the management would consist of more female staff. In fact the head teacher and one of the deputy head teachers are male. The ratio of male to female teachers in the senior management team is 2:1.
The teaching staff contains more female than male teachers with the ratio of 7:6. However 77% of the male teachers are on the upper pay scale earning between £26,919 to £31,128 pa, whereas there are only 66% of female teachers reach the upper pay scale. To reach the additional points of the pay scale, you must first collect all the experience points and then gain additional points for a responsibility.
The male support staff and education assistants earn over twice the amount than the female support staff and education assistants. This is because are admin. Officer is placed under support staff and he earns approximately £40,000 pa. This distorts the figures slightly. Without including him, the male support staff average earnings would be £11,811, which is still considerable more than what the female staff get. The male to female ratio in this block is 3:14. Due to the fact that the women’s wage rate were very diverse, it gave a lower average wage rate as it was calculated over a bigger range.
While collecting this data I noticed that the majority of the support staff and education assistants are only paid for term time, so after finding the recommended pay for 52 weeks, i.e. Pro rate, it had to be amended for 39 weeks. Also some of the staff do not work a 37-hour week, and work as little as 10 hours a week. Therefore, when finding the average for women’s earnings, I was not surprised to see that the average was reasonably lower. Due to more females than men working part time it has distorted the difference slightly, showing a bigger difference than what there actually between full time male and female workers at the school. Female part time workers are one of the reasons mentioned earlier as why women’s wage rate is lower than men’s.
When looking at the difference in wage rates between male and female management and teaching staff combined, you can see that females earn 91% of what the men do. When considering the difference when combining teaching staff, support staff and education assistants, it is noticeable that female staff are earning 27% less than men. When discussing the whole staff at the school, women are earning 31% less than men.
I think that the wage gap is closing, slowly but surely and I don’t think it will be long till men and women’s wage rate will be equal.
Conclusion
If the wage gap is closing due to men’s wage rate levelling off, closing the gap will cause a fall in household incomes for a number of households. This could lead to a fall in demand, an increase in unemployment and maybe even a recession.
At this moment in time, approximately 26% of the female working population are part-time workers which means they receive a lower wage rate. This could put forward a problem in the future. The average life expectancy for a healthy female is 79.6years whereas it is only 72.3 years for a healthy male. Women tend to live longer than men but have smaller pensions to live off, due to the fact that they could not save enough throughout their working life due to a lower wage.
After looking after this information, I think the reason why women are paid less is due to the fact that women do part time more often than men and it is bringing down the female average. I don’t think that there is much sex discrimination even though there is twice as many male management staff as female at Cardinal Wiseman School, in a work force that is dominated by females.