Is hairdressing less skilled than motor mechanics? It doesn’t matter, actually
More than 90% of hairdressing apprentices are female; 99% in the motor trade are male. The gender imbalance has always existed, but there is growing concern about the how trainees are treated by their employers. The Equal Opportunities Commission says that, on average, male apprentices earn £40 a week more than their female counterparts.
A study carried out in 2005 for the Department for Education and Skills showed hairdressing apprentices earned an average of £86 a week, while those in the motor industry earned £116 per week, and those in engineering and construction around £140. The statistics revealed a general rule: the more female trainees an industry had, the less they were paid.
For a start that last sentence is just wrong, on so many levels. I’m not disputing the correlation, but I am disputing the fact that it means anything, at all. That is not a rule, that is a half-assed observation. The article is about wage differentials in college apprenticeships (in this case, mechancs, engineering, hairdressing):
Hollie, who has been working for more than a year, earns the £80 a week minimum, while Melanie earns £116. Yet Ashley Smith, who works in a commercial bodyshop in Ipswich and is downstairs today in the college’s motor vehicle body-repair workshop, takes home more than £200 in a good week.
The hairdressers put as many hours on their two-year level 2 NVQ courses as the motor-industry apprentices, and they will leave with equivalent qualifications. So is it fair that some of the boys are earning twice what they are?
Melanie thinks not. “I definitely think our skills are equivalent to theirs, but we don’t get paid as much. We do three hours of practical work in here each week, then we spend four or five hours on theory. People say hairdressers are dumb, but the key skills we have to learn are quite detailed.”
Sadly, this fundamentally mis-understands basic economic principles.
Economic discrimination proceeds thus: two individuals are paid different wages for the same job, when they differ according to a dimension not relevant to their marginal product of labour – i.e. gender, when gender is not important (teaching, for example). This is the bad discrimination. Anything else is discrimination of the job, not the worker.
This is an important difference. The part that the Guardian is getting fundamentally wrong is this: it doesn’t matter how much training each sectored-worker (mechanic or hairdresser) gets, or how many skills they build. As long as a hairdresser’s skills cannot be used immediately to fix cars, there will be no equalisation between the two sectors.
Here’s why. Well, first, skills and training just don’t count. That does not determine your wage. It determines wage differences in the same sector for any given job, but only if it increases your productivity – not just because you went to the effort.
Each worker, that a firm hires, contributes more to total ouput (we will assume not to have maximised that part of the equation). We call this the Marginal Product of Labour. Hire one extra person, and total output Y changes by a given amount. The firm then sells that extra amount, along with everything else, so
- One extra hairdresser means X1 extra hair-cuts
- One extra mechanic means X2 extra cars repaired
Notice that the time and effort they put into learning their craft is not relevant. So, question: what is the value to the firm (i.e. in the marketplace) of hairdressers and mechanics?
It is the Marginal Product of Labour multiplied by the Price – the Marginal Revenue Product of Labour. The Marginal Revenue Product of Labour is the marginal contribution each extra worker makes to the revenue of the firm. In a market in which firms are competing for labour that will equal their wage (Price equals Marginal Cost, as usual).
So what determines the Price of hairdressers and the Price of mechanics? The marginal value in the marketplace of hairdressers and mechanics (so P1X1, compared to P2X2 – it is differences in the Pis and in the Xis that matter); it is not determined by the hours they spent in college, or the technicality of their skills. Hence if the skills of hairdressers could be used to fix cars, their wages would calibrate: if hairdressers were paid less than mechanics, they’d leave hairdressing to become a mechanic; the influx of hairdressers would also shift the supply of mechanics out, lowering their price in the market for Mechanic Labour. That, however, isn’t the case.
Following this: perhaps the low wages will lead to a decline in hairdresser-numbers. This will shrink their supply, leading to an increase in Price (i.e. wages). All of this means the market for these different types of labour are doing exactly what they’re supposed to be doing, according to economic principles.
‘Fair’ and ‘Unfair’
There are two other issues, here. The first is to do with welfare. If the UK government is trying somehow to get school-leavers into higher social classes (sorry: Social Class is a labour-related definition, capturing skills and education. I’m not being an asshole), then perhaps it needs to kick in for hairdresser apprenticeships, to make them more remunerative. Then there will still be a disparity in their wages (which more hairdressing apprentices, following higher rewards, will probably worsen), when working, compared to mechanics but, as we’ve just determined, that is not an issue.
If there is an imbalance in supply of the two, why are there not more girls apprenticed as mechanics? Ah, that is a relevant question. As we saw in the first quote, more than 90% of hairdressing apprentices are female; 99% in the motor trade are male.
The Confederation of British Industry is also concerned that young women may be discouraged from applying for better-paid jobs because of poor careers advice. Its policy adviser for education and skills, Louise Morgan, cites research by the Engineering Employers’ Federation, showing just 17% of young people were given information at school about apprenticeships.
With this I am deeply sympathetic, having suffered a truly shit careers advisor when I was in high school. However, and again, that statistic 17% is meaningless. Maybe only 17% need information about apprenticeships. What makes information about apprenticeships so great (at my school our advisor talked about nothing else – of little use to those of us who did go to University and had to work it all out for ourselves)?
Again, from the Guardian:
“Often girls are being forced down the route of traditional subjects by advisers who don’t know about the opportunities out there,” Morgan says. “Employers have a role, too, to invest in skills and to make sure people feel valued financially. We need to transform how society thinks about these things.”
And again, not relevant. For a start, an editor should have removed the word “forced”. I managed not to be forced to go to TAFE, even though that’s all I was told about in high school. In any event that is not industrial relations policy, that is education policy (to be fair this is Education Guardian – but they’re dealing with industrial relations, and I think my point is that they should avoid doing so).
Second, no: Employers do not have a responsibility to make sure people feel valued financially. Employers have a responsibility to pay wages up to Marginal Revenue Product of Labour. Now, suppose they don’t: then other employers will, meaning they will get better labour, because labour will compete for their (higher paying) jobs. Eventually the discriminating firm will decline. If we’re too impatient for that, that again is industrial relations policy, but of a different sort. Moreover it still does not have economic implications for the wage disparity between sectors.
Stephen Gardner, director of apprenticeships at the Learning and Skills Council, agrees. “There are two issues here. One is that females are being paid less within the same sectors, and that is something we need to challenge with employers. That isn’t on at all. But I think there’s also a fundamental problem, which is that young people aren’t always told what they’re likely to earn in each different sector. So they don’t have the information they need.”
See, now his first point is relevant. However it was not addressed anywhere, here, and he does not provide any numbers, nor does he specify whether he’s talking about workers or apprentices (my guess is the former). We’ve just yet to see a comparison of anything but different types of apples and oranges.
The problem appears, at worst, to be that too few advisors are carefully explaining to these kids, from day one, how the labour market works. That some jobs will earn more, that some jobs will earn less, what those jobs are what those jobs entail. At worst it seems there is asymmetric information that is happening to benefit males disproportionately – but this is a coincidence.
Personally I’d love to see hairdressers paid more than mechanics. I have no hair but I hate cars. Give me a few million fewer cars and many thousands fewer people required to keep them poisoning my air and running over my fellow pedestrians. We can all walk peacefully together to the local hair salon.
This is my final fit, my final bellyache:
…the government’s attempts to expand the scheme will bring little comfort to Anna (not her real name) from Oxford. She discovered, after starting her apprenticeship in hairdressing, that her boyfriend, an apprentice plumber, was earning twice as much as she was. Just before the £80 minimum was introduced, she was taking home £75 a week and her boyfriend £150. Now that both are qualified, the pay gap between them has narrowed, with Anna earning around £250 a week and her boyfriend getting a little over £300.
“We worked the same hours, and we were both doing a valid trade qualification, so why shouldn’t we be paid the same?” she asks. “I’m happy working in hairdressing, but why shouldn’t women be paid what men are paid? I don’t think it’s fair.”
My advice to the government: squeeze a Principles of Economics class into your college courses. Especially the journalism ones.