03.11.10

Enzi: Passage of Workforce Investment Act Best Solution to Close Earnings Gap

WIA Provides New Training and Needed Skill Development to Obtain High-Wage Jobs

Washington, D.C. – The path to closing the earnings gap between women and men lies in providing the skills and training needed to enable more women - and men - to enter new higher-earning jobs, not burdening employers with new, unfunded mandates,” U.S. Senator Mike Enzi, (R-Wyo.), Ranking Member of the Senate Health, Education, Labor and Pensions (HELP) Committee, said today.

“We should reauthorize the Workforce Investment Act (WIA) this Congress to ensure workers have access to the education and skills training they need to be successful, and to ensure employers have the skilled workforce they need to be competitive,” said Enzi. “We must devote time and energy to developing new ways to encourage private sector job creation.”

“The Paycheck Fairness Act,” the focus of a HELP Committee hearing today, “will subject employers to more litigation, including far larger class action suits and increased penalties, even when there is no evidence that an employer intended to discriminate,” Enzi added. “This bill adds more burdensome government reporting requirements that don’t just waste hours of an employer’s time; they also cost money that could be directed towards new hires.” 

Enzi’s full hearing statement is below:

HELP COMMITTEE HEARING:

“A FAIR SHARE FOR ALL: PAY EQUITY IN THE NEW AMERICAN WORKPLACE”

“Good morning. I want to thank Chairman Harkin for scheduling today’s hearing on the very important topic of wage equity. 

I am confident that there is no member of this Committee who would tolerate paying a woman less for the same work simply because she is a woman.  As husbands, fathers and mothers of working women, we all recognize the gross inequity of discrimination in pay based on gender.  Congress has put two laws on the books to combat such discrimination – Title VII of the Civil Rights Act of 1964 and the Equal Pay Act of 1963. 

Undeniably, the last several decades have been transformational with regard to women’s opportunities.  Today, more women than men are earning college degrees, and women are enrolling in many graduate degree programs in equal numbers.  At some of the nation’s top law schools today, women students outnumber men.  As women have become commonplace at every level of the workplace, so have women’s earnings increased in comparison to men’s.  Last month I noticed several news articles reporting that the number of dual income families where the wife out earns the husband has increased from 4 percent in 1970 to 22 percent in 2009.   So times have changed, and certainly it is appropriate for this Committee to survey the fairness of the American workplace. 

Some argue that a pay gap continues to exist in terms of compensation levels between men and women, and that this proves current legal protections are not sufficient and must be augmented.

Many labor specialists note that pay differentials are a function of labor market economics, that they reflect the choices that individual workers and groups of workers tend to make and their underlying skill sets.  A study released last year found that if you factor in observable choices such as part time work, seniority and occupational choice, the pay gap stands between 5 to 7 percent.  I believe the best way to address that gap is by encouraging women to enter higher earning fields.

The career choices we all make impact our earnings, and data shows that women are more likely to select fields that pay less.  There are many reasons one might make such a choice, including schedule flexibility, job security and the quality of fringe benefits such as health, retirement and childcare.  I, for one, would never question the logic of making such a tradeoff.  In fact, economists have noted that the current economic downturn has had a harsher effect in traditionally male occupations and the unemployment rate for men has been a full 2 percentage points above that for women throughout the recession. 

Yet, to the extent that women may not enter traditionally male fields precisely because they have been traditionally male, they may not be earning to their full potential.  I believe the goal of this Committee should be to find solutions, and I have two solutions to offer for this potential problem.  One, improve our national job training programs so all Americans, women and men, have access to the skills training they will need to enter these fields. And, two, fix the economy so that these higher earning jobs are plentiful and hiring again.  

I have worked in four Congresses to update the Workforce Investment Act, which has not been reauthorized since its enactment over 12 years ago.  I’m working now with Senators Harkin, Murray, and Isakson, and building on the bill that passed the full Senate in the 109th Congress.  We should reauthorize WIA this Congress to ensure workers have access to the education and skill training they need to be successful, and employers have the skilled workforce they need to be competitive. 

We need look no further than my home state of Wyoming to find a perfect example of what is happening and what can happen to improve the job skills and training for all Americans.

Wyoming, as some of you may know is nicknamed “The Equality State”. It was the first territory and the first state to extend the right to vote to women. Wyoming was home to our nation’s first woman judge, the nation’s first woman governor, and the nation’s first woman elected to state-wide office. In 1920 the town of Jackson, Wyoming elected the nation’s first all-woman town government.

Despite Wyoming’s long history of gender equality its “pay gap” is among the highest of all the states. I can assure you that this is not because Wyoming employers are notoriously discriminatory, or grossly undervalue their female workers. Rather, Wyoming demonstrates that markets, choices, education, training and opportunity all play a role in the establishment of wages and wage differentials.

In Wyoming, important sectors of the economy such as energy, natural resources, and construction have faced significant labor shortages and therefore offer very high paying jobs.  The reality is that many of these jobs, from heavy equipment operators to carpenters, and from welders to coal miners, are not positions to which women traditionally gravitate. In Wyoming market forces have greatly increased the labor rates for those jobs traditionally held by men, which largely explains the magnitude of the wage gap. Closing this gap requires an increase in training and educational opportunities for women.

The role of education and training is evident in the results of one such program. “Climb Wyoming” is a not-for-profit program funded through a mix of private and public funds. Its mission is to move low income single mothers to higher paying careers through training and placement assistance. The program has enjoyed considerable success, with program graduates earning double and even triple their pre-program income levels.

In many instances these gains have been achieved by encouraging program participants to consider “non-traditional” work in the energy, natural resources and construction industries; and providing participants with the necessary skills training and placement assistance to make the transition into such “non-traditional” work.  To date, Climb has trained and placed more than one thousand single mothers in such non-traditional careers as short-haul truck driving, welding and construction trades.  

One woman from my home town of Gillette earned a commercial driver’s license and now works as a short-haul truck driver for a construction company – more than doubling her pre-program earnings.  Another single mother with two children entered the program in Cheyenne. Previously, she worked in a fast food restaurant and earned $6.00 per hour. She enrolled in Climb, studied integrated systems technology and is now employed at a wind energy generation farm and earning nearly three times her pre-program income.  These are all real examples of women that have, with encouragement, training and education, managed to eliminate the pay gap in their own working careers.

But as good as programs like Climb Wyoming are, they cannot create jobs in a bad economy.  And, unfortunately, this prolonged downturn has added another hurdle for the women who graduate from the program.  In Gillette, for the first time, the majority of the most recent class of graduates has not been able to find employment.  Women who trained as heavy equipment operators and commercial truck drivers are either still waiting for companies to be in a position to hire or are working just one day a week. 

This brings me to my second solution – fix this economy.  As a Congress, we should be devoting our time to developing ways to encourage private sector job creation.  In the energy field, which creates many jobs in Wyoming, this means working to get permits for energy development on federal lands processed in a timely manner and promoting tax policies that encourage the energy industry to hire workers and continue with domestic energy development.  This means scrapping the plans for a cap and trade tax that has created economic fear and uncertainty in many energy sectors which inevitable depresses job growth. 

We must reject proposals that make employers less likely to create new positions and fill vacant ones.  Legislation that makes it more costly to employ someone by adding unfunded mandates, increasing litigation burdens and increasing taxes are taking us in the wrong direction.  Even when these proposals are not enacted, they have a chilling effect on employers who understandably look to Congressional hearings and debates to figure out what new government burdens may be placed on them.  

The legislative proposals being promoted here today will not create jobs, except for trial lawyers.  The Paycheck Fairness Act will subject employers to more litigation, including far larger class action suits, and increase penalties even when there is no showing that an employer intended to discriminate at all.  It would tilt the law so heavily against employers that they will be advised to settle such suits instead of defending their pay practices.  The bill adds more of the burdensome government reporting requirements that don’t just waste hours of employers’ time, they also cost them money that could be directed towards new hires.  Further, we must be exceeding cautious about proposals that ultimately seek government set wage rates and would turn our economy down a disastrous road. 

I appreciate the chance to review women’s pay in the workplace and share the success of Climb Wyoming with my colleagues.  The real pathway to closing the remaining wage gap lies not with increased litigation and government intervention, but with increasing opportunities for women to gain lucrative skills and choose high earning occupations.

We should redouble our efforts to reauthorize the Workforce Investment Act and focus on other job growth policies without delay.”

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