My favourite thing about writing the teen money book earlier this year was trying to answer the actual questions that teens asked me about money. Because I tell ya, some of the questions that seem simplest, turn out to be friggen DEEP.
One question that was asked over and over again was: why do some jobs get paid more than other jobs?
Which is one of those questions that it's really hard to answer without going on a really long rant about labour market segmentation, collective bargaining, and the history of slavery. But how do you explain all of that to 11-year olds, in 1 page?
The simplistic answer I ended up giving was:
- It's a little bit about supply versus demand: how many employers want to hire people with those skills versus how many people have those skills
- It's a little bit about how hard it is to gain the skills you need to do that job
- It's a little bit about how much bargaining power people doing that job have (monopoly industries usually get away with paying less because there's less competition over labour; unions help workers negotiate better deals etc.)
- It's a little bit about public regulation (e.g. laws around minimum wage and how easy or hard it is to fire somebody)
- It's a little bit about how much value* that job produces (*value here defined in a pretty limited way, as in, how much an employer can sell the product of that labour for, or the "productivity" of that labour)
But even taken all together, these factors don't fully explain why some jobs get paid more than others. Discrimination is also a factor, as well as cultural ideas about what kind of work is valuable and what kind of work isn't. And all of that is shaped by history. Economies weren't invented yesterday by a computer designed to maximise human flourishing; they're the outcome of all the ways that humans have interacted with each other over tens of thousands of years.
One of the most powerful things that intersects with wages is deeply rooted cultural ideas about the value of women’s work and men’s work.
A lot of the most essential work that is done in society is mostly done for free, and mostly done by women: care work. This is still true today, even though more women also participate in the paid labour force. This is an enormous amount of free labour that benefits society as a whole. Imagine if every elderly person was housed in a public old age home and the work of caring for them was done by paid employees, funded by taxes. Our taxes would be much higher! (One of my favourite policy ideas is that people who do care work in their own homes should at least be able to offset the value of that labour against their income tax bill.)
This creates a specific problem for people who do care work for pay: they're systematically paid too little. Because think about it, they're competing against free labour. It's hard to compete with free.
If you zoom out of society and look at the gap in income between men and women, it's about a lot of different things: women spend less time in the workforce because of the years worth of unpaid work they do at home, unconscious bias means that women are less likely to be seen as competent and promoted or get pay increases (like, in South Africa, 73% of the country's teachers are women, but only 37% of the school principles are), and sometimes, active discrimination makes workplaces so hostile to women so they drop out of those jobs. But it's also because the types of jobs that women are more likely to do are paid less.
Recently, New Zealand passed a powerful new law aimed to address pay discrimination against female-dominated professions, which I'm kak excited about. Unlike rules about "equal pay for equal work", which is about ensuring that different people doing the same job aren't paid differently because of their identity (which is also still a problem), this is a law about making sure that women-dominated jobs aren't paid less than men-dominated jobs that are otherwise similar. This piece by Anna Louie Sussman in the New York Times describes it well:
Instead of “equal pay for equal work,” supporters of pay equity call for “equal pay for work of equal value,” or “comparable worth.” They ask us to consider whether a female-dominated occupation such as nursing home aide, for instance, is really so different from a male-dominated one, such as corrections officer, when both are physically exhausting, emotionally demanding, and stressful — and if not, why is the nursing home aide paid so much less? In the words of New Zealand’s law, the pay scale for women should be “determined by reference to what men would be paid to do the same work abstracting from skills, responsibility, conditions and degrees of effort.”
The law was sparked by a case where a caregiver in a home for the aged successfully argued that her profession was underpaid relative to equivalent men-dominated public jobs (elder care in New Zealand is paid for by the government). The case resulted in a review of similar jobs in the public sector that resulted in 15-49% pay increases for more than 55,000 workers, and this new law is going to result in wider salary reviews, looking at jobs like midwives, social workers and school support staff.
Men reading this, I really do believe that pay equity would have huge benefits for you too. Because care work professions are undervalued (in status as well as pay) and are seen as feminine, few men do them, and this can have other negative consequences for society. Take mental health, for example. Men have much higher rates of suicide, homelessness and substance abuse than women, and yet less than 25% of social workers are men. If we valued care work more and destigmatized men who do this work, more men might get better care.
If 2020 has taught us anything, it must surely be that jeez, care work is so friggen valuable, and that the people doing these jobs deserve so much more money and respect than they get.
There's been so much talk this year about how nurses and teachers and public sector doctors are heroes. I hate this! They only have to be "heroes" because we make their jobs so hard, and we really don't have to do this. We could just make them well-paid professionals with good working conditions and a goddamn work-life balance. That's a choice that we can make as a society, and I really hope that we do.
If you agree, here are three practical things you can do:
- If you employ a domestic worker, carer or nanny, make sure you are being a good employer. Register for UIF and make the contributions you're legally required to. Consider taking out life and disability insurance for them (Simply has a policy that extends to foreigners working in South Africa). Check that you're paying them a living wage, because it's total bullshit that the minimum wage for domestic workers is lower than other types of workers.
- Be careful that you talk with respect about people who do care work, "feminized" jobs, or work in the home caring for children or other family members. Understand that the fact that we treat engineering as though it's very difficult and important, and care work as though it's inessential and frivolous, is loaded with sexism. The number on your paycheque has very little to do with the actual value of the work you do.
- If you work for a business, and you have the power to, advocate for fair policies like longer paternity leave and pay equity.
Wishing you lots of tough questions from 11-year olds,
Updates from Sam-Land
As I write this, it's snowing outside my window, and it is magical.
- This is the last newsletter of the year, because I am pretty exhausted, friends, and looking forward to taking a bit of a break. I love you to bits, and I'll see you in January! xx
- I had a really fun chat with my buddy Nic Haralambous on his podcast. We chatted about curiosity, and weaponizing your insecurities.
- I've mostly been working on the climate change game. It's neeeearly done. You'll see it early next year, promise!
- I've been doing lots of WEIRD activities to keep my brain amused. These have included: opening books at random and making nonsense poems from the first sentences I read, reading descriptions of animals I've never seen before and trying to draw them from my imagination, and reading tarot cards without looking up the meanings. These activities have been pretty fun, but I'm also just really missing seeing friends and doing NORMAL ACTIVITIES in a non-pandemic, to be honest!