Laura Adler: From the Job’s Worth to the Person’s Price: The Transformation of Organizational Pay Practices since 1950


Wednesday, September 15, 2021, 4:00pm to 5:30pm


WJH 1550

Economic Sociology Seminar presentation by Laura Adler, Harvard. Joint session with Culture and Social Analysis Workshop.


This talk examines a major historical change in employers’ pay-setting practices. In the post-war decades, most U.S. employers used bureaucratic tools to measure the worth of each job. Starting in the 1980s, employers abandoned these practices and relied instead on external market data to assess the price of a candidate. In doing so, organizations tied employee pay more tightly to the external labor market. This presents a puzzle for organizational theories, which propose that organizations aim to buffer internal functions from the environment. To describe this shift, I use a new database of 1,059 publications from the Society of Human Resources Management and 83 interviews with compensation professionals. These data highlight the surprising role of law. When the U.S. courts rejected comparable worth lawsuits in the 1980s, their decisions created an opportunity for employers to reduce liability for discrimination by relying on external, market data. Those legal decisions encouraged employers to abandon bureaucratic methods. The analysis identifies market coupling—using the market to distance organizations from discriminatory outcomes—as a response to the law and highlights how the comparable worth movement backfired by facilitating a change in organizational practices that entrenched inequalities.