Policy: Labor

Obama's solution to phony wage gap is another job-killer

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Opinion,Diana Furchtgott Roth,Columnists,Barack Obama,Jobs,Labor,War on Women,Unemployment,State of the Union,Magazine

President Obama insists on repeating the erroneous “statistic” that women earn 77 cents on a man’s dollar, most recently in the State of the Union address, in order to push for more required employee benefits that would turn America into Europe.

“Today, women make up about half our workforce. But they still make 77 cents for every dollar a man earns. That is wrong, and in 2014, it’s an embarrassment,” Obama said.

Nonsense. The 77 percent figure is bogus because it averages all full-time women, no matter what education and profession, with all full-time men. Even with averaging, Labor Department data show that women working full-time make 81 percent of full-time men's weekly wages.

When women are compared to men in the same job, with the same numbers of years in the workforce, they make about 95 percent of men’s wages. The remaining nickel could be discrimination, or it could be a measurement error.

Obama knows the 77 percent figure is bogus. So why does he go on saying it?

Look at the president’s solution to the supposed wage gap. “A woman …deserves to have a baby without sacrificing her job. A mother deserves a day off to care for a sick child or sick parent without running into hardship – and you know what, a father does, too.”

Obama says that even when women put in less time, employers should pay them the same. This is an attempt to get more paid sick leave, more paid maternity leave, an attempt to turn America in Europe—which is suffocating with slow growth and high unemployment under the weight of requirements on employers.

Obamacare has already imposed on employers with 50 or more employees the burden of paying for generous health insurance — or facing a $2,000 fine per worker. Moving from 49 to 50 workers can cost an employer $40,000 per year (the first 30 are exempt). America has 1.2 million fewer payroll jobs than in December 2007, before the start of the recession.

Adding paid sick-leave and maternity care would further raise the cost of hiring and slow job growth.

Mandatory paid sick-leave and maternity care would particularly reduce the hiring of women. Everyone knows that it is women who take the “day off to care for a sick child or sick parent,” as the president said. Women will become more costly hires, so less desirable. If employers had two equally qualified candidates, a man and a woman, they would choose the man.

Just as raising the minimum wage to $10.10 an hour, as the president has proposed, would hurt low-skilled Americans and teens, imposing additional mandates for sick leave and maternity leave would hurt women.

Women have won in America because they can go into any field they choose, and are protected from questions about their intentions to marry and have children. Many of them choose flexible full-time jobs, or part-time jobs, to enable them to combine work with family. Some of these jobs pay less. But a choice of more time at home rather than more time at the office is not a social problem in need of a government solution.

Obama’s supposed “solution” to his manufactured wage gap “problem” would hurt the women he says he wants to help. It would mean fewer jobs in America, and fewer jobs for women.

America is in an international race to attract investment and the jobs that go with it. Congress and the president can help us win -- or make us lose. Using the wage gap myth to impose more costs on employers and send jobs abroad is the way to lose the global growth race.

Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a Washington Examiner columnist. She directs www.Economics21.org at the Manhattan Institute. Follow her on Twitter here.
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Diana Furchtgott-Roth

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The Washington Examiner

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