Among today’s hot topics for business reporting is the increasing proliferation of local and state laws forbidding inquiries about a job applicant’s salary history. Somebody has finally figured out that prospective employers can skimp on salary offers to a given employee if they know her last employer did it too, and by how much. In short, anybody who has ever had to accept lousy pay can be locked into getting lousy offers for the rest of her working life. It is a quick and easy recipe for perpetuating discrimination.
Nobody, however, has come up with any explanation for why a current or prospective employee should have to negotiate for her compensation at all. When I go to get my hair trimmed, the charges are posted on the wall. If I find them exorbitant, I can go to another hair stylist. When I go to the grocery store, I am informed up front how much a pound of asparagus will cost, and can choose to buy broccoli instead if it’s cheaper this week. In a First World economy, most prices are transparent and fixed.
But in the good old First World USA, jobhunters (and would-be purchasers of cars, for some reason) are in a Third World marketplace, except that the job applicant cannot plead actual poverty, which would guarantee not being hired. Even employers who pay poverty wages don’t want to hire poor people.
I have in fact lived in places where I had to bargain over a pound of candy or a length of fabric. I learned the techniques quickly—“my father [had I been older and of marriageable age, it would have been “my husband”] would never let me pay so much for [whatever.]” The seller would respond with the number and ages of his children, and their school fees, and ultimately we would reach a more or less equitable price.
But here in the First World USA, if my grocer has no trouble coming up with a good market price for a pound of asparagus, why can’t an employer come up with a good market wage for an administrative assistant? If requirements for the job are accurately defined, why can’t the employer just say “Here’s what getting that stuff done is worth to me,” and hire the first person through the door who meets those requirements, at that stated compensation rate? Obviously, it’s because the employer doesn’t want to pay what the job is really worth, if there is any way to avoid it. Salary history is just the easiest way to avoid paying what the job is worth. Even civil service tables leave some room for “flexibility,” which is almost always exercised only by the boss. Given the utter uselessness of most job interviews (don’t take my word for it, there’s data on this-- www.highsnobiety.com/2017/04/10/job-interviews-useless-research/, https://www.nytimes.com/2017/04/08/.../the-utter-uselessness-of-job-interviews.html, https://www.bloomberg.com/view/articles/2016-11-04/job-interviews-are-useless), this flexibility is mostly used to justify extra points given to applicants who remind the boss of his best friend, or are in some other utterly irrelevant way “likeable.”
Anyway, what is really going on here is that the employer is not willing to say outright “this is a $15 an hour job,” so instead he tries to ascertain whether the applicant is a “$15 an hour person” as indicated by salary history. A $15 an hour person is not necessarily 50% better than a $10 an hour person in terms of how well or diligently s/he does the $15 an hour job—this is not a test for market-value competence, but for caste. (Which is why, as noted above, even employers who pay poverty wages don’t want to hire poor people. Poor people, after all, are always having emergencies involving health or transportation. They tend to be fat and have ugly teeth. The employer is vastly better off hiring a middle-class young person who is still living with her parents and can therefore afford to accept poverty wages and still keep her car and her teeth in good repair. All parties to this transaction have agreed to ignore the fact that her parents are thus subsidizing the employer. The last year and a half of American politics should have made it clear to all of us that rich people don’t get rich by spending their own money.)
A couple of anecdotes in support of this position (note: real life is not statistically significant, it is anecdotal): A friend of mine who had been working in the lower reaches of equity trading decided to change career paths, and started interviewing with professional associations for management jobs. On one such interview, the interviewer asked her what salary she was looking for, and she quoted the salary she had been receiving at her previous equity trading job. “Oh, we would never pay our girls that much,” the interviewer said. My friend replied, “But how much do you pay your women?” Needless to say, she didn’t get the job. (For many years, a laundromat in my neighborhood had a sign in the window advertising “Girl wanted. Must be over 35.”)
Another friend of mine, who had been a high-level executive secretary before leaving to have a baby, applied for a job advertising its pay range as “$10 to $20 an hour.” Based on that experience, she told the interviewer that she was looking for $20 an hour. The interviewer indignantly replied, “You can’t tell me what I’m going to pay you” and then offered $12. My friend responded, “You can’t tell me what kind of money I’m going to work for. Twelve dollars won’t even cover child care and transportation.” She didn’t get the job either. “Negotiation” may be a misnomer for this kind of transaction. Negotiation implies more or less equal bargaining power, and some flexibility on both sides. If the position had been advertised at $12 an hour, that would not constitute “negotiation”, but it would at least be transparent and fixed. But when one party has an inflexible fixed price in mind, but will not name that price at the outset of the interview, this “interview” is merely a waste of time for both parties, or an ego-building exercise for the interviewer.
Legally barring the use of salary history in the hiring process won’t put the two parties on an equal footing, or introduce real numbers into it. It’s a start. Hopefully the next step will be to publish everybody’s salaries (anonymously, of course), making them just as public as if they were set by a civil service schedule or a union contract. If we really believe in the free market system, we should be willing to post its results publicly. If we aren’t willing to publish the real yearly earnings of any particular job (including not only hourly pay, but average number of hours worked) maybe that’s because we’re ashamed of it. Maybe we should be.