May 13, 2005

Pay Data Alone Cannot Determine Discrimination

The unions think they can shame Wal-Mart into giving its wage data to Democratic members of Congress. In response to the sex discrimination lawsuit, Wal-Mart has already given all its wages for 2001 to its opponents.

Personally, I'd like to have Wal-Mart's data, because it would make an interesting study, but I'm not in the businesses of intentionally distorting numbers to hurt the company. And I don't think releasing such partial information can do anything but continue to obscure the actual impact discrimination has had on the women of Wal-Mart.

I think that a much better (though much harder to obtain) dataset would include not just gender, hours, positions at WM, performance reviews, and wages, but the educational and work histories -- including performance on skills tests and hours and pay at non-WM jobs -- of a random sample of employees. Then, and only then, could one determine the impact of discrimination (as opposed to the impacts of education, prior experience, and continuous employment) on wages and promotions.

Many studies have found in other circumstances that when you adjust wages for these and other factors, the alleged sex discrimination in pay narrows considerably or disappears. The only data that could really determine the impact of discrimination would not just demonstrate unequal pay for equal work, but unequal pay for equal work, given equal education, skills, willingness to change jobs, ambition, and prior experience. Without the latter, the pay data demonstrate very little...

CNN/Money has the skinny.... Wal-Mart responds at length -- with charts!

Posted by Kevin on May, 13 2005 at 07:42 AM