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Wage Justice Comparable Worth and the Paradox of Technocratic Reform.

Wage Justice Comparable Worth and the Paradox of Technocratic Reform. By Sara M. Evans and Barbara J. Nelson. Chicago, IL, The University of Chicago Press, 1989, 224 pp.

"Comparable worth has a compelling sound of fairness ... [but] compensation of employees according to comparable worth is one of the most sweeping changes ever proposed for the U.S. economy. Its advocates argue for nothing less than a complete overhauling of the manner in which pay is determined by firms and governments." This quote from Joyce P. Jacobson in Comparable Worth Analyses and Evidence gives credence to the view that the concept of comparable worth has, at times, divided individuals and groups into opposing camps. In an atmosphere which is at times adversarial, new insights regarding comparable worth issues may be worthwhile. The two books reviewed here examine comparable worth from two different perspectives. One approach attempts to add to the theoretical framework of comparable worth and also provide empirical data to test the hypotheses that have already been advanced. The second approach examines the application of comparable worth theory from both a political and a historical point of view.

What is comparable worth? It is not a simple, straightforward concept. Instead, comparable worth calls for the use of job evaluation techniques to group jobs into "comparable" categories without a direct comparison of the duties involved.

In their introduction, Mark Killingsworth and Anne Hill, the editors of Comparable Worth Analyses and Evidence, explain that comparable worth is a shorthand expression for equal pay for jobs of comparable worth." "Comparability" would be determined by the results of a job evaluation in which points would be assigned to jobs based on such factors as skill, effort, responsibility, and working conditions. When equal point scores are ascertained for different jobs, they are considered comparable even if they have very dissimilar duties. For the purposes of comparable worth analysis, job evaluations take place entirely within an individual firm; no cross firm or industry comparisons are made. The firm's analysis would determine if jobs with equal point scores held primarily by women are paid lower rates than those held primarily by men. If jobs held predominantly by women have lower rates of pay, then their pay scales might be adjusted.

A brief legislative history is also included in the introduction. Killingsworth and Hill note that the sponsors of the 1963 Equal Pay Act rejected the principal of comparable worth in favor of a more limited concept of equal pay for equal work. Federal courts have generally not been receptive to the comparable worth philosophy, and, in several cases, the Department of Justice has filed amicus (friend of the court) briefs opposing the concept. The editors suggest that because of the lack of interest shown in the private sector, in the Federal courts, and by the Federal Government, comparable worth proponents have concentrated on State and local government, where more than two-thirds of the 50 States have begun studies. Several large local jurisdictions have also undertaken comparable worth studies.

Wage Justice Comparable Worth and the Paradox of Technocratic Reform, Sara M. Evans and Barbara J. Nelson, is a "case study" of one of the most successful applications of comparable worth in the United States to date. The introduction describes the objective of the book when it states, "The heart of the study provides a history and analysis of the legislative process .... the process of implementation in Minnesota State government .... and implementation in 1,607 local Minnesota jurisdictions."

Evans and Nelson note that the comparable worth movement results from the persistent wage gap of about 33 percent in annual earnings between women and men employed full-time year round. The theoretical frame for opponents to comparable worth rests on neoclassical economic theory. Wage justice is found in the market wage, a wage which equals the dollar increase in revenue to a firm which results from an additional worker's production. For proponents, the theoretical underpinnings of comparable worth develop from institutional economics. Wage justice, through the nonmarket intervention mechanism of comparable worth, would correct a flaw in the market that allowed systematic underpayment in wages in the past of both women and minorities. If uncorrected, the flaw would result in continued income disparities for women and minorities.

In Minnesota, comparable worth was mandated for State employees, and a similar law also was passed for local jurisdictions. Evans and Nelson say that a group of women at the State level, together with colleagues in the union movement and in the legislature, were highly effective in the passage of both pay equity laws. The authors indicate that comparable worth legislation was generally achieved through public sector collective bargaining, and Commissions on the Status of Women.

However, successful implementation varied at the State and local levels. A very successful implementation of comparable worth was achieved for Minnesota State employees.

However, this was not the case for local governmental units. In fact, local managers often moved the process away from wage justice and toward technical concerns. Therefore, it is important to recognize the difference between success in passing comparable worth legislation and success in implementing the legislation.

A most surprising aspect is that most local jurisdictions had no job evaluation systems in place when comparable worth legislation was passed. Managers often did not have a clearly defined concept of their employees' job duties, and wage-setting in many local jurisdictions was often handled in a haphazard manner. In response to legislation, personnel specialists were hired, studies were undertaken, and the findings were the basis for a new kind of management. In the end, wages were increased for some employees in those job classifications where women have predominated, and for men's classifications as well.

The papers presented in Comparable Worth Analyses and Evidence were prepared by several well-known economists. The papers follow along two paths. Two papers seek to amplify the theoretical foundations on which the arguments for and against comparable worth are based. Two other papers present findings of empirical studies which attempt to test the validity of the theories which support or deny comparable worth.

The first of these papers is a discussion of efficiency wage models. Efficiency wage theory provides a theoretical bridge between neoclassical economics and the kind of institutional economic theories considered as support for comparable worth. Mark Aldrich and Robert Buchele present a detailed description of theories in which firms from primary-sector industries pay higher than market wages to their workers in hopes of increasing their productivity. The implication for comparable worth is that higher than market wages may cause an increase in productivity from those workers who receive wage increases through comparable worth wage adjustments.

The second major attempt at expanding the theoretical base for evaluating comparable worth was presented by Joyce Jacobson. She first describes a simple supply-and-demand model and then adds complexities to the model (for example, the presence of discrimination, the presence of sex-linked preferences for different kinds of jobs, and the presence of monopsony power). She concludes that for each of the changes she introduces, comparable worth wage adjustments would be inefficient although they may lead to a more equal distribution of earnings. She suggests affirmative action and recourse to the courts as a means of alleviating discrimination against women.

In an attempt to test some of the suppositions about comparable worth, Elaine Sorensen explores the gender composition of occupations to estimate its effect on pay differences between men and women. She suggests that the sex differences in occupations account for a larger proportion of the pay gap than previously estimated. Thus, she implies that comparable worth wage adjustments might narrow the wage gap to a greater extent than anticipated.

Some economists have suggested that comparable worth adjustments may actually widen the pay gap, however, by drawing more women into overcrowded occupations, thereby lowering their earnings in those same occupations. Sorensen uses the proportion of women in an occupation or "percent female" as an explanatory variable in her analysis. The "percent female" found in an occupation is sometimes thought of as a proxy for discrimination against women. However, we may also think of "percent female" in an occupation as the interaction of two separate forces: supply and demand. For example, the supply of women workers in an occupation may be influenced by choices which will allow more time for responsibilities at home, while the demand for women workers in an occupation may be influenced by factors such as employers' preference for men because of perceived lower turnover costs or for other reasons. Until we can accurately measure the effect of these opposing forces on the "percent female-' found in an occupation, the question of increasing wages to achieve equity is rhetorical. The final outcome may be exactly the opposite.

Ronald Ehrenberg examined the findings of several research studies on the actual or the expected results of comparable worth in the areas of employment, substitution of one kind of worker for another, occupational mobility, and general equilibrium effects, as well as pay gap findings. His conclusions were that the effects of comparable worth were probably moderate, but that not much was known about secondary effects on occupational choices and wage structure in the sector not directly affected by comparable worth.

Both of these books give a sound assessment of issues surrounding comparable worth from their different perspectives. Wage Justice provides an interesting history of the application of comparable worth in Minnesota, while Comparable Worth Analyses and Evidence probes theoretical and empirical questions in an attempt to evaluate the adoption of comparable worth in the United States.
COPYRIGHT 1991 U.S. Bureau of Labor Statistics
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Author:Easley, Arline
Publication:Monthly Labor Review
Article Type:Book Review
Date:Dec 1, 1991
Words:1589
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