(WITHDRAWN) Pay Disparities Among American Social Workers in the Nonprofit, for-Profit, and Public Sectors

Background and Purpose

U.S. human services organizations are experiencing a workforce crisis, with prevalent under-compensation for their employees and a record high staff turnover rate. Social workers are one of the major component of this workforce. Though no one would argue about the importance of a stable social work workforce to the human service field and it is well known that social workers have long been undercompensated, little scholarly attention has been paid to these workforce issues (e.g., compensation, pay equity of social workers). To date, we still know little about how the pay and benefits that social workers receive differ by different sectors (i.e., nonprofit, for-profit, public), racial groups, gender identities, as well as service industries. An understanding of this pay disparity issue would shed light on the human resource development of the nonprofit human service organizations.

Method:

This study compares the sectoral pay differential of full-time social workers employed in the three sectors and five service fields using data from the American Community Survey 2013-2017 5-Year Sample. The study also examines the pay disparities by service fields, gender, and racial identities. The three sectors are nonprofit, for-profit, and public sectors and the five industries include: social services, hospitals, health services, residential care facilities (without nurses), and elementary and secondary schools. These five industries employed the majority of American social workers. The ACS annual data are repeated cross-sectional survey data and are also nationally representative, including about 1% of the U.S. population each year. The 2017 5-year combined data are the most recent data available and standardize all monetary amounts to dollars as valued in the final year of data included in the file. The ACS data are individual-level, based on household surveys with detailed demographic and labor force information for individual workers.

OLS regression was used to predict the earning differential for nonprofit, for-profit, and public social workers. In addition, robust standard errors were calculated to address the heteroscedasticity issue of the error terms. Person weights were applied for all regression analyses.

Results

Descriptive statistics show that the nonprofit sector employed the highest numbers of social workers followed by the public and for-profit sectors. Regression analysis reveals a significant pay disparity across the three sectors with nonprofit social workers being paid 13% less than their government-employed counterparts and 5% less than comparable for-profit workers. The study finds only slight gender pay gap and insignificant racial pay disparities among social workers. Rather, the pay disparities mostly lie along the line of service fields.

Contributions

This study will contribute to the literature in the following ways. First, it adds empirical evidence to the scholarly quest of sectoral differences in pay and examined possible explanations. It tested the labor donation theory and the theory of wage transparency’s effect on pay. Second, it documents the pay disparities of social workers working in difference sectors and service fields. Lastly, it substantiates the existence of “care wage penalty” in the social work profession.