The question of income inequality is so much more complex than simply stating that women make 76 cents on the dollar as compared to men or one ethnic group earns more than another ethnic group. Having spent a good deal of time in Human Resources earlier in my career, I understand the primary factors that go in to determining salaries. When interviewing potential candidates, all an HR manager or director has to determine a candidate’s ability is his/her resume, interview skills and references. Salaries are determined by what the market will bear and salary history of the candidate. The following are just a few of those factors.
1) Education-Those who graduate from a better college or university certainly command a longer look and if hired, a better salary. While many experts are writing about the uselessness of college, given the debt that students are carrying, college graduates and those with graduate degrees still earn far more income over a lifetime than those who are uneducated.
2) Successful Job Changes-In the age of technology, very few employees will spend their entire careers with one company. In fact, how successful one is in changing jobs and increasing his/her salary each time, will determine how much one is earning as they prepare to retire. Of course this assumes a high level of competency. But some people are better salary negotiators than others. Even in 2014 women, as a rule, are not as aggressive in negotiating salaries.
3) Ability-Not everyone possesses the same innate ability. Therefore, allowing employees to know what each of their counterparts is earning is not a good idea. People, including President Obama, who believe in salary transparency are completely misguided. What it would do is force employers to make it known which employees are better at their jobs and that would create animosity and hurt productivity. Of course the President once again proves how little he understands business.
4) Children-Even in 2014 women are still the primary care givers and maternity leave means that their careers have pauses which leads to loss of income over time.
Let’s be very clear, if you’re one of the people who don’t like the top 1% of wage earners, that’s your right. But if you believe that the top 1% is the reason that you don’t earn what you believe you’re worth, that’s nonsense. One of the greatest misconceptions is that because the top 1% of the income earners in the United States control most of the wealth, there isn’t enough for the rest of us. However, tens of millions of people in this country own homes and cars and go to Disneyland with their families. Billionaires aren’t stopping them from living good lives. Just as they always have, the Harvard and Yale graduates will always have an advantage over those who attend community colleges. But there is more than enough wealth for the other 99% to grab a piece of the American Dream. The growing disparity of wealth is a lot more complicated than simple inequality.