Another March 8 has already passed, but at People we firmly believe that gender equality in the workplace is an issue that must also be addressed during the other 364 days of the year.
Although much progress has been made, there is still a long way to go. We know that gender equality at work is key to economic recovery, or that female leadership is an effective rival against COVID-19. However, some thinkers argue that the gender revolution is still unfinished[1], stagnant[2] or incomplete[3]. This article aims to shed light on two major recent contributions to complete such a revolution: rethinking the private sphere and redesigning work (the last chapter, according to Goldin), in order to take a further step towards overcoming gender inequality at work.
The merging of the spheres of life
The industrial revolution marked a clear distinction between the public and private spheres. The public sphere was basically dominated by men and the private sphere by women. The gender revolution involves a redefinition of how people participate in the two spheres and according to Goldscheider and colleagues (Goldscheider et al., 2015) there are two parts to it. The first part of the gender revolution is the entry of women into the public sphere. Since the last century, we have seen very important steps, such as a clear increase in women’s participation in the (paid) labour market, a higher level of university studies compared to men, women’s participation in the political sphere, or in the cultural, judicial, scientific and many other fields. This first part of the revolution is underway, and although progress has been made, important gaps remain, and work must therefore continue.
On the role of men at home and the alteration of spaces
If the first part of the gender revolution was the entry of women into the public sphere, the second part of the revolution is the entry of men into the private sphere. According to Goldscheider and his colleagues, this second part will be as profound as the first, and we’re just at the beginning. The benefits of the two halves of the revolution will not only be at the economic level, strengthening our economies, but also at the intimate level, strengthening families, households and care-giving. Thus, work-life balance is linked to social benefits for children, equity and sustainability.
In the demographic field, a pessimistic view of households and families has prevailed in recent decades: delayed childbearing, fewer children, more break-ups, and less stability in general. Among other factors, this was attributed to postmodern values (individual lifestyle, self-fulfilment, leisure) and the entry of women into the labour market. Esping-Andersen and Billari, two renowned academics from Bocconi University, offer another view (Esping-Andersen and Billari, 2015). According to them, there has not been a radical alteration in the importance of households, families and care, and so much so, in fact, that they show that when the first part of the revolution is somewhat consolidated, and the second part begins, all the indicators (fertility, stability, etc.) start to grow again. This is the case of the Nordic countries, where the incorporation of women in the public sphere, Corporate Family Responsibility (CFR) policies and the active participation of men in the household have revitalised all the indicators that had been in decline.
The authors, therefore, observe a U-shaped trend. When there’s more equality (gender egalitarianism) in both spheres (public and private), the economy is strengthened, and households, families and care-giving are strengthened. It is therefore important to unmask all barriers to enable the two halves of the gender revolution to be completed.
On the other hand, Claudia Goldin, a prestigious economist from Harvard University, invites us to think that the last chapter of the gender revolution does not involve public intervention, nor providing women with more strategies for negotiation, nor encouraging the participation of men in the home (although, as she says, all of these factors help). The last chapter of the gender revolution involves encouraging changes in the labour market, modifying the way jobs are structured and paid.
Gender Revolution, Salary Revolution
To understand gender inequality at work, we have to keep talking about the gender pay gap, but we often lack supporting elements in our discussions. Goldin provides us with one. According to her groundbreaking study published in the American Economic Review (Goldin, 2014), the key to the gender pay gap lies in occupations with non-linear wages. Let’s explain it well. There are occupations with linear wages, where basically the more hours worked, the more money earned. It is proportional. However, there are occupations where wages are non-linear, they are convex. In these cases, working more hours means earning much more money than would be proportional. This is the case in law firms, banking, consulting, and the corporate world in general. Reaching the top is rewarded, but to get there, it takes not only talent, training, and aspiration, but countless hours worked, often 70+ hour workweeks. Not meeting the number of hours limits the real chances of reaching the top, and women, according to Goldin, by interrupting their careers more often, or reducing their number of hours per week, are less likely to reach the top position. And it’s in these fields where wages are non-linear that the real gender pay gaps emerge, not in more entry-level positions.
Goldin offers two pieces of empirical evidence. One in a field with non-linear wages (law), and one in a field with linear wages (pharmaceuticals). On the one hand, Goldin examined law graduates (JD) at the University of Michigan (1982-1991). After graduation, the wage differentials between men and women were zero. At five years they were minimal, but at 15 years the differences were very significant. Goldin explains that 60% of these disparities can be explained by two reasons, both of which are related to time: 1) career breaks (usually maternity), and 2) the number of hours worked per week. Flexibility is therefore an interesting tool, but with a very high price to pay in these occupations.
In contrast, in the pharmaceutical field, one of the most evenly paid yet linear careers, she found that 40% of women aged 30-50 in the study worked part-time, with no implications for their career paths. In this case, flexibility was equally interesting, but at the same time, there was no price to pay. There are two main reasons for this: employees are good substitutes for each other, and transaction costs are low. And this is explained by having highly standardised processes, allowing the substitution of one person for another, with no productivity implications (transaction costs). Therefore, the use of flexibility policies, be it career breaks or part-time work, has no negative implications for the individual or the company. Goldin therefore suggests 1) rethinking how time is allocated, used and remunerated, and 2) rethinking processes (using technology) to make employees good substitutes for each other, reducing transaction costs for the individual and the firm.
Hopefully, by the next March 8, we will have made important steps in the second part of the gender revolution, as well as in its last chapter.
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