Nobel Prize winner Claudia Goldin on remote work’s potential to narrow gender pay gaps
Nobel Prize winner Claudia Goldin on remote work’s potential to narrow gender pay gaps
It’s been an exciting few days for the winner of the Nobel Prize in economics announced on Monday.
Claudia Goldin revolutionized the study of how and why women are paid less and otherwise held back from the same career trajectories as men. Goldin recently spoke with “Marketplace Morning Report” host David Brancaccio about “couple equity” and how remote work has been a game-changer for women. Below is an edited transcript of their conversation.
David Brancaccio: I was looking at your latest book from the year before last, the “Career and Family” book explores how American women of working age are the most educated ever. And yet highly educated women who’ve gotten their way to the top now face, you find, the biggest gender wage gaps. I mean, why is that even for the most successful women?
Claudia Goldin: Because a gap is a difference. So that doesn’t mean that they themselves aren’t doing well. We’re not shedding tears for the lawyer who works at a boutique law firm, but we’re comparing her with an individual or saying a gender gap, which is the difference or the ratio to men who are often way in the right tail of the wage distribution. The wage gap is large because disproportionately women sort of step back and then step forward in terms of their career when they have care responsibilities. And that is responsible for a lot of this difference.
Brancaccio: Care responsibilities — often children, but also it could be for older adults or disabled people in the family.
Goldin: That’s right. It could be for any number of individuals, including the spouse himself.
Brancaccio: No, I mean, I take your point that if someone’s making a lot of money at the top of their careers, it’s not the raw amount of the wage gap that should be of great concern. But there is a fairness issue that could cause people to be upset, right? That doesn’t seem right.
Goldin: It does not and there are two sides to this: couple equity and gender equality. And for different-sex couples, those are the two sides of exactly the same issue. So if couples give up couple equity — so for example, I said we have two lawyers and they have kids. They have a choice: They can both take a flexible job and both of them can be on-call at home, or one of them could take the less flexible job, make oh, a lot more. Let’s say $60,000 a year or more. Well, that’s a lot of money to give up for couple equity. So instead, they give up couple equity. One takes the job that is, you know, let’s go with the Park Avenue law firm job and the other one takes the very nice boutique law firm job. That accounts for a large difference for these sorts of high income, high education — that’s the group you were referring to — couples. They have given up couple equity and, at the same time, they have thrown gender equality under the bus.
Brancaccio: What’s so interesting about your point, professor, is that a lot of blame can be placed on society and culture at large. But maybe the fault, dear Brutus, lies within our couples, within ourselves …
Goldin: There are several places that we can put blame. And putting blame also means that we can find a solution. So one area is that certain occupations offer what I was calling “greedy jobs.” It’s the greediness of that other job that said, “Hey, couple, if you give up couple equity, we’ll give you a $60k more a year.” So part of it is that some jobs pay implicitly more on an hourly basis — if you put in more hours, if you give yourself essentially to the firm. The flip side of this, by the way, is that it’s not just the person who has the greater care responsibilities who is giving up something, but it’s the other person who is living a life of the high-flyer, but is not going to see his child take her first step.
Brancaccio: So interesting. Yes, companies that significantly reward this bargain that some employees might take, which is, at some level, shirk your family responsibilities in return for a nice reward we have for you.
Goldin: Right, so the quote, “blame” is both in let’s use the word “marketplace,” and the other part of the blame is that who takes that position is not a coin flip. If it were a coin flip, then you would have couple inequity, but you wouldn’t have gender inequality. But in fact — as you said — the blame also lies in a society which says, if someone has to take the on-call, at-home position, it should be the woman. So the issue is that the couple is being enticed to do this. And the couple is also sort of normatively traditionally feeling that if they do that, it’s the woman who should take the on-call, at-home job, and the man who takes the, you know, on-call, at-the-office job.
We have another big change that we’re going through at the same time, which I think is narrowing the gaps: that is the ability to work from home and to work remotely. So think about that, the jobs that I was just talking about that entice that person to give up couple equity and throw gender equality under the bus, part of that is that some jobs once required a tremendous amount of travel. The person who is on-call at home is not the person who’s going to be traveling every other weekend. Well, if that has changed and we no longer have to go to Beijing to sign the contract or to Zurich to do the M&A, then women who traditionally would be the on-call, at-home parent can take those jobs. And by taking those jobs, they are really narrowing the gap. So that’s sort of what I call the silver lining to the pandemic, is that we’ve learned to do something that we could always have done, but it wasn’t considered proper. And then suddenly, it became not only appropriate, but the better thing to do. So that’s another huge technological change, which I think is a step forward for women.
Brancaccio: And your previous comments certainly underscore the idea that, as companies debate about how aggressive they should be about bringing employees back to the office and away from remote work, that there is a clear gender equity issue at stake.
Goldin: There is a clear gender equity issue at stake. There’s no question that if we have some people working remotely and others not, be careful that it isn’t that only the women are in this category of “you are allowed to work from home.” So there are lots of issues that we should be careful about. However, even though there may be problems with it, it’s probably a step forward. Consider the following: If I want to work, but I have to work part-time rather than full-time, I’m not going to be considered a real member of various queues, or not entirely. I may be passed over for a promotion, because I’m a part-timer. Now, let’s say that I can work three days in the office and two days at home. I’m a full-timer, and it may be a step forward. So in that sense, it could be better even if women still are disproportionately the remote workers. And firms do have to be very careful about not creating what I call, you know, “a female enclave.” We don’t want to add yet another layer of occupational segregation to this mix.
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