Women nearing retirement confront pay gap

For all the strides that women have made in the workplace over the past quarter century, one sub-group has been left behind: older women.

Those within five years of the normal retirement age have made no progress – relative to men's earnings – since 1975, according to a recent census report. Those within 10 years of retirement have advanced exactly one percentage point; by 1999, they were earning 56 percent of what men earned.

Discrimination? Perhaps. But the findings suggest other factors are at work.

When it comes to their careers, men and women tend to take different paths. And as time goes on, those paths diverge. They separate so much in later years that some economists argue that the pay gap between men and women is misleading and very nearly irrelevant.

"It's very hard to say what the real differential is," says June O'Neill, economics professor at Baruch College in New York City and former director of the Congressional Budget Office. "If there is any differential, it's probably not very big."

"It seems to me in order to close the wage gap we've reached the point where women will have to behave exactly like men," adds Christina Hoff Sommers, resident scholar with the American Enterprise Institute.

No one expects that to happen anytime soon.

On the face of things, women get short shrift when it comes to payday. For example, the US Census Bureau calculates, based on its 2000 figures, that the average woman working full-time and year-round earned only 73 percent of her male counterpart's income. That has changed little during the 1990s, even though women are working longer, entering more lucrative fields, and delaying pregnancy compared with their mothers.

Even narrowing the education gap with men has had little effect. Every year since 1982, more women than men have earned bachelor's degrees in the United States. Nevertheless, the earnings gap persists across all levels of educational attainment, according to a recent census report.

Age plays a more important role. Among the youngest set of full-time, year-round workers (age 25 to 29), the census report found that women earn 84 cents for every $1 that men earn. Among the oldest workers (60 to 64), the gap stood at 56 cents.

Several factors explain such differences. First, women choose different and, often, lower-paying careers than men (such as education instead of engineering). This was especially true through the 1960s, when today's older women first entered the workforce.

At the time, women still faced many barriers. Well-educated females took jobs such as librarian and social worker, with little prospect for big gains in earnings, says Harvard economist Claudia Goldin.

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