Earnings differences between men and women: an introductory note, (EXCERPT), Monthly Labor Review Online, June 1983

A new method for estimating job separation rates by sex and age

Janice Shack-Marquez

With the development of human capital theory, increasing attention has been given to specific training and its impact on employer hiring decisions with respect to sex and race.¹ The traditionally weaker labor force attachment among women in comparison with men, for example, has given rise to the perception that risk of loss of a firm's investment in specific training is greater for the former than the latter.² This perception is one basis for statistical discrimination in which class information, for example, that pertaining to sex, is used as a criterion for hiring men rather than women, although both may be equally qualified for a given job.³

The view that women are much more likely to separate from an employer has several bases, among them are casual observation, economic theory, and empirical data. Casual observation suggests that in married households responsibilities for home production have been delegated to the woman. The reasonableness of this inference is augmented by the economic theory of marriage in which the main inducement to marriage is seen as the advantages of specialization of labor, the most important of which is procreation.⁴ Not only may a married woman leave an employer to rear children, she may also leave if her spouse finds a better job elsewhere,⁵ or when a temporary condition which has impelled her to find work ameliorates so that she may resume nonmarket activities. While information on worker turnover by sex and race is sparse,⁶ the data that are most accessible, that is, work experience and job tenure data, imply that women are more apt to leave an employer than are men. For example, 26 percent more women had work experience in 1977 as were, on average, employed during any given month in that year; the corresponding figure for men was 13 percent.⁷ Likewise, the median years of job tenure among women employed in January 1978 were 2.6 compared with 4.5 for men.⁸

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Footnotes

1 Gary S. Becker, Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (Columbia University Press, 1964).

2 Specific training is training which raises a worker's productivity in the firm providing such training and is generally paid for by the firm.

3 Edmund S. Phelps, "The Statistical Theory of Racism and Sexism," American Economic Review, September 1972, pp. 659-61; and Lester G. Thurow, Generating Inequality (Basic Books, Inc., 1975).

4 Separation rates for manufacturing industries were reported by sex until 1968. As of that date, the quit rate was 16 percent higher for women than men. See W. Kip Viscusi, "Sex Differences in Worker Quitting," The Review of Economics and Statistics, August 1980, pp. 388-98.

5 Jacob Mincer, "Family Migration Decisions," Journal of Political Economy, October 1978, pp. 749-73; and Robert H. Frank, "Why Women Earn Less: The Theory and Estimates of Differential Overqualification," American Economic Review, June 1978, pp. 349-60.

6 Separation rates for manufacturing industries were reported by sex until 1968. As of that date, the quit rate was 16 percent higher for women than men. See W. Kip Viscusi, "Sex Differences in Worker quitting," The Review of Economics and Statistics, August 1980, pp. 388-98.

7 Work Experience of the Population in 1977, Special Labor Force Report 224 (Bureau of Labor Statistics, 1982).

8 Job Tenure Declines as Work Force Changes, Special Labor Force Report 235 (Bureau of Labor Statistics, 1979).

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