The Effects of Labor Shortages on Starting Salaries for Sex-Typed Jobs

An experimental simulation was conducted to examine potential differences in sensitivity to forces to supply and demand among male and female sextyped jobs. Respondents faced with a labor shortage favored raising salaries for male sex-typed jobs, but favored alternatives to salary increases for female sex-typed jobs at entry and middle levels Findings are discussed in terms of occupational sex stereotypes and differing perceptions regarding the urgency and difficulty of filling vacancies in male and female positions. Article: In 1963, when the Equal Pay Act was passed, women earned on average 60 cents for every dollar earned by men More than 20 years later, in 1986, the Bureau of Labor statistics reported that women still averaged only 69 cents for every dollar earned by men (Green & Epstem, 1986). In recent years, women's rights groups, legislators, and some labor unions have worked to further reduce the pay gap between the sexes. Much of the effort to achieve pay equity between men and women has coalesced around comparable worth pay policies. Under a comparable worth policy, jobs evaluated to be equally valuable on dimensions such as effort, skill, and responsibility would be compensated equally (Schwab, 1980). For example, if evaluated to have the same worth, positions as dissimilar as truck driver and secretary would be paid the same, regardless of the prevailing market wages for these jobs. In other words, proponents of comparable worth argue for greater emphasis on internal equity and less emphasis on external equity in setting salaries within an organization (Treiman & Hartman, 1981). Opponents of comparable worth advocate setting salaries based on labor market forces of supply and demand. (For an excellent review of various positions on comparable worth, see Gold, 1983.) They assert that the external labor market operates efficiently and without bias with respect to the sex of the job holder (Hildebrand, 1980) A central question in the comparable worth controversy and one addressed in the present study concerns the degree to which salaries for predominantly male and female sex-typed job are equally influenced by market forces of supply and demand.  Portions of this study were presented at the National Academy of Management Meetings, Chicago, 1986 Labor Attorney Winn Newman, commenting on employers' assertions that the labor market determines wages, challenged the free market theory of wage determination (Newman, 1984) According to Newman: Another major objection raised by employers in wage discrimination suits us that job evaluation does not set wages Rather it is "the market" that sets wages, and "the market" is a sacred cow But there is no objective market concept that fleshes out wages for various jobs Reliance on the market to set wages is characterized by so many variables that it could mean something different to virtually every employer The employer decides whom to survey, what kind of survey, which jobs to survey and so on (p 90) Comparable worth advocates assert that employers respond differently to labor shortages in male and female occupations (Hartman, Roos, & Treiman, 1985). Bergmann (1985) argues that employers are more sensitive to forces of supply and demand in predominantly male positions, and more willing to raise salaries when demand exceeds supply for male jobs When demand exceeds supply in predominantly female positions, on the other hand employers resist raising salaries. Using econometric models of the labor market, Killingsworth (1985), showed that females, particularly women in segregated occupations, could be assigned lower salaries. However, there have been no empirical studies of the influence of job sex type on salary assignment in the context of a labor shortage. Human resource shortages in female positions may be resolved by other strategies, including subcontracting, job redesign, automation, or foreign recruiting For example, North Carolina Secretary of Administration, Jane Smith Patterson, recently described employers' reactions to a nursing shortage (Patterson, 1984): A few years ago, an acute shortage of nurses existed According to the free market theory, employers would have raised salaries In theory, a substantial boost in salaries would attract more potential nurses to meet the shortage But employers increased nurses' salaries only slightly, meanwhile they cut nursing services, adjusted nurses' hours and spend large sums recruiting nurses overseas The nursing profession remained virtually all women (97 percent) who made on average $17,300 (p 26) Hartman et al. (1985) also cited hospitals as using signing bonuses and foreign recruiting to cope with nursing shortages without raising starting salaries. Similar nationwide shortage of school teachers have been reported (Mackay-Smith, 1985). Responses by school administrators to these shortages include recruiting from Mexico, Canada, and Ireland; lowering entrance requirements; and only as a last resort, raising salaries. According to Stanley (1983), another strategy employers have adopted to deal with shortages in female-dominated occupations is to redesign or automate predominantly female positions Stanley cites job redesign, simplification, and ultimate job loss in such predominantly female positions as stenographer, bank teller, insurance clerk, and key punch operator. Mounting anecdotal evidence suggests that employers respond differently to labor shortages in male and female positions. A number of researchers (Milkovich, 1980; Schwab, 1980; Schwab & Wichern, 1983) have called for the study of the process by which supply and demand for labor in sex-typed occupations is translated into salaries and wages. Yet no study to date has systematically investigated the extent to which economic forces of supply and demand can be distorted by sex bias. Accordingly, a study was designed to examine the use of employer reactions to labor shortages in predominantly male and predominantly female jobs. The study tested the following hypothesis: Under conditions of a human resource shortage, participants will be more likely to assign a salary increase for male-dominated jobs while for female dominated jobs participants will be more likely to recommend an alternative such as a change in technology, job redesign, or recruitment from foreign labor markets. METHODS We examined the potential influence of Job sex type on recommendations for resolving a labor shortage in the context of a human resource management simulation. Experimental Design The effects of job sex type on resolving a labor shortage was examined across three organizational levels. Accordingly a 3 x 3 experimental design was created. Job Sex Type. Job sex type was manipulated at three levels. predominantly male job, predominantly female job, and neutral Job. Krefting, Berger, and Wallace (1978) showed that occupational stereotypes are largely based on the percentages of males and females in an occupation. Female sex-typed jobs selected for study were registered nurse, nursing aide, and telephone operator. Women hold 90% of all nursing positions and 93% of telephone operator positions (Mellor, 1984) The male sex-typed jobs selected for study were engineer (95% male), tool and die maker (99% male), and telephone installer (92% male). The sex-neutral Jobs selected for study were accountant, assistant buyer, and assembler, which are 40%, 48%, and 55% female, respectively. Job Level. The major question of interest is how job sex type influences reactions to labor shortages. However, by examining sex-typed Jobs across three organizational levels, the generality of the sex-typed job effects can be assessed. Accordingly, the organizational level of the three sex-typed positions also was manipulated Three job levels were created; entry level, middle level, and professional level. The selection of jobs at three organizational levels was based on Treiman's (1977) job prestige scale. Entry-level jobs of telephone operator, telephone installer, and assembler were of comparable prestige Similarly, the three middle level positions— tool and die maker, occupational nurse assistant, and assistant buyer—were at the same approximate prestige level. Finally, the three professional-level positions—registered nurse, engineer, and accountant—were at similar prestige levels. Strategies for Resolving the Labor Shortage The major dependent variables were respondents' evaluations of four strategies for resolving the labor shortage described in the human resource management simulation On the basis of reports in the scientific and popular press, the following four options were created. (1) salary increase to attract more applicants; (2) job redesign and simplification to attract applicants with lower qualifications; (3) recruiting outside the local labor market, including overseas, and (4) automation to reduce labor needs. Participants. Participants in the human resource management simulation were 105 undergraduate busmess students attending a large Southeastern university (24 males, 77 females, and 4 who failed to identify their sex) Fifty eight percent of the respondents were currently working full or part time. Procedure Respondents received an experimental packet in which they were asked to assume the role of a personnel administrator for a high-technology company. The company was described as experiencing a shortage of qualified applicants for one of its positions. Respondents read a job description and a summary of the unsuccessful recruiting strategy by the company for that job. Respondents then read a description of the four human resource strategies proposed as possible alter'natives to resolve the labor shortage. These strategies were an increase in salary, a change m technology, job redesign, and foreign recruitment. Participants were told that the relative costs of each option were approximately the same. Evaluation of each option was made on a 6-point scale, ranging from (1) strongly recommend to (6) strongly oppose. After evaluating each option, respondents were asked to select the option that they judged to be most effective for resolving the labor shortage problem Finally, as a check on the manipulation of job sex type and job level, respondents completed a brief postexperimental questionnaire. In summary, the study was designed to investigate how job sex type influences recommendations for resolving a labor shortage at three organizational levels. Participants read about a labor shortage in either a male, female, or neutral position at either an entry, middle, or professional level, and evaluated four human resource strategies for resolving the shortage. Participants received only one version of the simulation and were not aware that other versions existed.