No rational person would argue that people should be paid differently because of characteristics that have no bearing on their capability and willingness to undertake a particular job. It's rational to be "sex-blind" so to speak, because most employers want employees with the requisite skills, experience, capability and willingness to work, as well as trustworthiness, to do the job. There are a few exceptions to the rule that men and women should, everything else being equal, be paid similarly, for example, historically the porn industry pays women a lot more, although their "working lives" may be shorter than men. Does that mean that bureaucrats should investigate and seek to correct this?
Leaving aside that distraction, given RNZ - like most taxpayer funded broadcasters across the world - just swallows the philosophy of "pay equity" as fact, because its unconscious bias is in favour of critical constructivism (which is a more sophisticated way of describing what is commonly called "woke"), I thought it was worth reading its sources for supporting the view that "pay equity" is a problem that needs a complex bureaucratic solution to fix.
As to be expected, RNZ found plenty of "howls of outrage" and of course nothing beats the now much more famous Andrea Vance, who is now one of the country's best known and paid vulgarians. Those who are outraged undoubtedly think that there is some great injustice being perpetrated which can be fixed by the state either making taxpayers or making employers take money away from elsewhere to make pay "fairer".
RNZ looked to an article by Hayden Donnell on the Spinoff (Donnell is an RNZ reporter) and an article in The Conversation written by three academics (two of whom are sociologists and one in HR management).
Both demonstrate the fundamental flaws in the argument about pay equity. They assert that it is possible to fairly and reasonable assess different jobs based on "comparable levels of skill and training" and "similar amounts of responsibility" which should therefore mean that those jobs should be paid similarly.
Donnell said:
Though it’s been highlighted in government comms, the librarians’ claim didn’t just look at fisheries officers. It also compared their pay and conditions to property surveyors, teacher aides, customs officers, corrections officers, parking compliance officers, and administration staff. That analysis was carried out using a government-issued assessment tool Te Orowaru, which provides a lengthy set of criteria to help claimants compare work responsibilities in seemingly disparate fields.
Think a bit more about that. A tool, accepted by the public sector, seeks to analyse bureaucratically how jobs ought to be compared with one another. It is central planning par excellence which appears to have nothing to do with what is always a key factor in pay in the private sector (you know, the part of the economy that actually generates wealth the part of which is taken for the public sector to tell it what to do) - demand.
In the private sector, employers generally pay whatever it takes to attract employees and retain them. The employer works out how much net income the employee will generate, through sales, productivity or savings in administration, and pays accordingly. Employers will pay what they need to get the people they want. That's an assessment of a number of factors, but most of all it is around productivity, competence and trustworthiness. Levels of skill and training may inform that but aren't decisive. Level of responsibility is a factor, but by far the most important point is whether the persons wanted might not stay in the job, which is a matter for them. Jobs that involve unconventional hours, working away from home, uncomfortable situations of all kinds, will require more pay. Most private employers are small, so are not price setters (unlike the state which, given it has the power of coercion to force people to pay for it, is a price setter), and while some private sector employees are unionised, ultimately the decision to hire and pay is a matter for those who take the risk with setting up businesses in the first place.
The pay equity problem is that academics, bureaucrats and leftwing politicians treat the issue as something fundamentally flawed in capitalism, that employers, including government departments, have paid women historically less than men. The Conversation article claims:
pay equity seeks to make visible and fix the deep, structural inequalities that have historically seen women’s work undervalued compared to men’s work. It’s about ensuring jobs that are different but of equal value are paid similarly, as a way to achieve gender equality.
Equal value to whom? Two people in exactly similar jobs with different employers may be paid differently because of factors that the academics and bureaucrats (let alone the politicians who create legal mandates for this) have little visibility of. The person in the lower paid job may prefer the employer, who may be more flexible around working hours, and may have colleagues who are more enjoyable to work with, and there may be many other "soft" factors that no bureaucrat could identify. Anything from location of employment, to management style, to the working environment. The diversity (a word commonly used but ignored in the case of capitalism) of conditions is almost infinite, but none of this analysis takes this into account.
Is it unfair if someone in a job they chose is paid less than someone else in another job they chose?
The academics claim "Pay equity is about addressing both the objective and subjective elements contributing to that gap". Really? How can they possibly know what those are?
The cost to taxpayers (undoubtedly seen as predominantly men) is dismissed as being "high" but "bearable" apparently (not that taxpayers have any choice), but it is the last statement of that article which is revealing about how bereft of serious critical thinking there is in talk about "pay equity":
Finally, focusing exclusively on reducing fiscal cost risks other costs rising instead. Women who are paid less than they should be will struggle to put food on the table, pay back student loans, get onto the property ladder, contribute to Kiwisaver and afford their retirement.
Without pay equity, in other words, there is less economic activity in general.
Where do these people think the money comes from to raise a small number of womens' pay? It isn't from a magic money tree, it comes from other people who engage in economic activity. The people who do pay for food, pay their student loans, buy property and save for their retirement. Most the talk of pay equity is about transfers from taxpayers to people paid by the state, and as with all talks of collectivised pay it bears zero relationship to the actual performance and productivity of those being paid.
It goes further than this, because the advocates of pay equity have lobbied for pay "transparency" requiring employers to publish what they pay their employees (employee privacy is apparently not important). Why not also lobby for the value of all contracts in the private sector to be transparent, why not tell everyone what everyone is paid for everything? The idea that consenting adults might want their business with other consenting adults around money to be private is an anathema to wannabe central planners who see opposition to their cause as being "resistance to changing or challenging the status quo, benefiting already privileged and advantaged groups", as if it is all a zero sum game. Hints of Marxism of the bourgeoisie vs. the proletariat. Anyone opposing Marxism is automatically defending the bourgeoisie.
As with so many theories in the space of post-modernist critical theory, extraordinarily complicated analysis is surprising reductive and overly simplistic. The complexity of a modern economy of millions of actors, making many millions of decisions, based on endlessly diverse factors is beyond the capability of the best intentioned bureaucrats, academics and politicians to understand. The simplistic reductive fallacy and the conceit (Hayek's Fatal Conceit highlighted this issue) to think that officials can decide what people should be paid, rather that it being about what it takes to attract the right people to a job in particular circumstances, is the fundamental error.
There may be pay equity issues across many different characteristics that, on the face of it, look unfair. Do short people get paid less? Do overweight people get paid less? Do relatively good looking people get paid more and get more job interviews? Do blondes, especially blonde women get neglected for promotions due to stereotypes? All of this may be true, and there are bound to be more cases. For fairness should the state collect data on all of these factors and engage in complex bureaucratic processes to ensure people of "oppressed" characteristics are paid equally?
Politicians on the left are particularly attracted to the power and capacity of the state to "fix" things. The problem is, as the Soviet Union and the significant list of examples that followed have proven, it is impossible to centrally plan an economy and society in a way that is remotely as productive or indeed fair as a relatively free, open, market economy of people largely left to co-operate, compete and work.
Most people think their work is "undervalued" and want more pay. Most people who own businesses think their products and services are undervalued and want more pay. The path to more people being paid more is not through generating complex regulatory frameworks, managed by public servants, designed by management consultants. It's by enabling people to innovate, to create, produce, hire people to support this, and to let people trade.
Central planning and control of pay might give an illusion of fairness, but when the reason salaries are low is because NZ's GDP per capita is amongst the lowest in the OECD, so that employers can't afford to pay what is paid in Australia, the United States, Europe or Singapore, then it's a delusion.
