Nov 20, 2020 in Case Studies

Variation in compensation for women compared to that of men in the corporate world
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Variation in Compensation for Women

Compared to That of Men in the Corporate World

 

The labor value of men and women has been always different through the history of market relations and lead to the originating of the wage gap the term, which indicates the difference between womens and mens earning status (Brunner, 2007). Although the wage gap is tend to diminish in the Millennium, the gender factor in compensation policies still exists. A profound analysis of each aspect of the matter under consideration can provide insight into the problem of pay inequity and offer alternate solutions.

Underestimation of womens economic status can be traced to the 11th century B.C. In The Book of Leviticus, the third book of The Hebrew Bible, we find an example of the variation in tribute, paid for male and female, vowed to the temple: the difference reaches 20 shekels of silver (Burnette, 2010, p.1). However, in The New Interpreters Bible, Walter Kaiser regards this fact strictly on the basis of womens labor abilities, regardless of their personal value (Burnette, 2010, p. 1).

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Joyce Burnette (2010) states that the value of womens labor force throughout history has always been at the rate of about 60% or even lower of that of men. Further on, she provides an example of the Britain of the 14th century, when earnings of women employed as masons mates amounted only to two-thirds of payments to men (Burnette, 2010, p. 1). Joyce Burnette (2010) explains that the reasons of income difference were rooted in prejudices about womens social and intellectual inferiority, which were supported by the church.

At a higher or lower rate, the pay inequity remained until the middle of the 20th century. Despite the attempts of the National War Labor Board, a lot of American women, which were involved in war industry, were pushed out of the labor market after World War II to provide work places for returning soldiers. As a consequence, in the 1950s full-time working women earned 59-64 cents for a dollar earned by men for the proportionate tasks (Brunner, 2007). All these factors facilitated the adoption of the Equal Pay Act in 1963, thereby prohibiting pay discrimination for the same job, based strictly on sex (Brunner, 2007). Since then, the working conditions and requirements have changed to a great extent, but the fact of the wage gap existence remains incontestable and alarming.

According to the data in the Catalyst Quick Take from the Knowledge Centre (2013), the average weekly income of the American women employed full-time in 2012 was 691$, as compared to 854$ of men. If we take a close look at variations in compensation, we will notice a number of factors that influence the rate of earnings, i.e., education level, experience, marital status, age, sphere of the industry, and even race. In academia women with a Doctoral degree earn 363$ less than men with the same degree, the difference within a Professional degree makes up 421$, within a Masters degree 390$, etc. However, the Pew Research Centre (2010) provided statistic data of marriage and earnings in the USA, which demonstrated the gender role reversal, caused by womens prevalence in education and income growth over their male counterparts. Besides, the increase of income of married men and women and unmarried women form 1970 to 2007 resulted into 60%, whereas the median earnings of unmarried men rose only by 16% respectively (Catalyst Quick Take, 2013).

Although marriage turned for women into their advantage in the rate of income, the disparity in compensation deepens with age: if young women of 20-24 make 93.2% of mens earnings, at 55-64 years the sum is lowered to 75.1% (Catalyst Quick Take, 2013). This is due to the diminishing role of career and increasing importance of family and parenthood for women through a course of time.

Human society has always been organized on the traditional principle of gender based labor division, i.e., domestic realm lied within the womens competence, whereas men were in charge of outside or public work. The evidence of this can be seen as the wage gap variation by industry: the biggest rate difference in the USA is in the financial activities industry (70.5% of every dollar earned by men) and manufacturing (73.8%) (Catalyst Quick take, 2013). According to the theory of the two-level game in job negotiations, this custom leads to gender stereotypes and pay expectations. Bowless (2008) research showed the following:

 
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Sex stereotypes motivate gender difference favoring men ... through a combination of fulfilled expectations of male superiority in negotiating ability and gendered social norms with regard to appropriate negotiating behavior (Bowles, 2010, p. 11).

Gender role reversal caused allocation of duties and responsibilities in a family. As womens career aspirations have grown significantly in the last few decades, there is a tendency of increasing decision-making power of women in household financial matters. The Pew Research Centre (2010) reports that in the spouses with female breadwinners, the decision making process belongs to women in 46% of cases, yet in families with male breadwinners only in 35% of cases men are in charge of household finances. If the situation is not acted upon, this gender ideology may reinforce womens perception of their roles, both in the household and public, as competing and to enhance the value of their contribution in both realms (Bowles, 2010, p. 16). The consequences are already looming on the horizon constantly rising number of single fathers and neglected children.

The pay disparity implies ethical issues, as well, mainly caused by the factor of ethnic affiliation. Weekly earnings of African-American and Latino women in 2012 in the USA made 68% and 67% correspondingly of every dollar earned by white men (Catalyst Quick Take, 2013). The wage gap, treated as the demonstration of racism and ethnic stereotypes, results in social disturbance and cross cultural conflicts. This produces a self-fulfilling cycle when women of other ethnicities are inclined to have lower pay expectations than their male counterparts and feel reluctant to attain productive outcomes in compensation (Bowles, 2010, p. 9).

On the assumption of the recent tendencies of growing career importance for women, we can outline two basic perspectives of how the current situation will develop. The first one is connected with womens pursuit of overcoming the gender wage gap and providing equal job opportunities for both sexes. The second model is built upon female prevalence in the private and public realms. The times of the suppression of womens economic status are over; instead, we witness the rising demand for highly-qualified labor force irrespective of the gender.

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I am completely convinced that the variation in compensation, based on gender cannot be treated as a dangerous situation, for womens rights are protected by law and global market dictates its own rules. In other words, good education, professional skills, and personal characteristics are those things which are valued the most. The difference in figures proves that the pay inequity is created by the multifunctional role of women in the modern society, as they are in charge not only of household and family matters, but also have to perform their professional duties. The problem lies in human passive perception of prescriptive behavior patterns for males and females. To put it clear, apart from being well informed about their rights as employees, women should not lower their career aspirations on account of customary or social prejudices.

In sum, the variation in compensation between men and women can be traced to ancient times when it was based on physical labor value. In the modern corporate world, this variation is reflected in the wage gap that varies by age, industry, education, etc. In the last decades, the pay disparity was significantly reduced and favored the appearance of such tendencies, as gender role reversal and change in the traditional allocation of womens tasks between home and career. My anticipation is that we will witness the new type of society with no room for gender-based variations in market relations due to the improvements and amendments in labor legislation and social companies that support pay equality.

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