dissecting the gender pay gap

Do women receive equal pay for equal work? Four decades on from the landmark equal pay decision that was supposed to settle the matter, this question continues to open a can of worms.

Measuring the gender pay gap is a tricky thing. Overall it is plain enough that working women, on average, take home paypackets that are substantially smaller than working men. But this is so for a host of reasons, including that: women are more likely to work part time; they are more likely to work in lower-paid industries such as hospitality and retail; they are more likely to occupy lower status positions within those industries, and even as full-time employees they are likely to work fewer hours than their male counterparts.

The concept of equal pay itself also remains elusive. Does it just mean two workers, male and female, standing shoulder to shoulder in the same job should earn the same wage? Or does it mean male and female workers performing a job with a comparable skill level should earn the same?

The current test case on pay equality is all about unpacking this question to decide if women in social and community work deserve a pay rise. Which raises the thorny question: how do you compare the value of output from a disabilities carer to a mechanic?

The most common statistic referred to when measuring the gender pay gap is the difference between male and female ”full-time, adult, ordinary-time earnings”. That is, comparing the wages received by men and women aged 21 or older (or younger but receiving the full adult rate for their occupation) working in full-time jobs, minus any overtime or bonuses.

Currently this measure shows such women earn 83¢ for every dollar earned by men, based on an average male full-time annual wage of $70,720 versus $58,760 for women. But even this raises questions. First, how much of this gap is due to women performing lower-skilled full-time jobs? Such a measure, for example, compares the wages of a male chief executive with his female personal assistant. Of course you would expect the CEO to receive higher remuneration for his work which is presumably adding more value to the company, or at least involves bearing more of the risk.

A second variable not factored into this is not all full-time jobs involve working the same hours. Ordinary full-time hours can vary from 38 hours a week to more than 50 hours a week. Surveys show that males working in full-time jobs tend to work longer hours than females in full-time jobs.

One way the Bureau of Statistics has sought to get around these factors is to compare the ”average hourly cash earnings of full-time, non-managerial adult employees”. This measure controls for the lesser working hours of women while also excluding the very high salaries of managers, who tend to be male.

On this measure, the pay gap narrows to females getting 90¢ in the male dollar. It is important we know what part of the gender pay gap is due simply to the different working patterns of men and women so that we can then know how much comes down to simple sex discrimination, the undervaluing of traditionally female occupations or the barriers to advancement women face because they bear the main responsibility for child-rearing.

That is why the federal government’s move this week to get compulsory reporting from individual businesses on the gender gap within their organisations holds so much potential.

SMH  12-13/03/2011 Compare the value and close the gap.

This entry was posted in Uncategorized. Bookmark the permalink.

2 Responses to dissecting the gender pay gap

  1. hemen parekh says:

    Equal Work : Unequal Pay

    Times of India [ 14 March, 2011 ] cites Global Gender Gap Report 2010 by World Economic Forum, to report as follows :

     There is no country on earth where women get equal pay as men for equal work

     India ranks # 128 on gender parity, with USA ranking at # 6

     In USA, women earn only 77 cents per dollar earned by men

     In India, where an estimated 60 % of all agricultural operations are handled exclusively by women, their hourly wages range from 50 % to 70 % of male wage rates

     In corporate India, the average annual income of a woman is $ 1,185, as against $ 3,698 for a man [ in 60 of the 100 best employers ]

     To avoid paying “ Statutory Minimum Wages “, Government of India employs thousands of women on “ honorarium “in its own welfare schemes

    So much for the Gender Equality in 21st Century !

    With regards

    hemen parekh


    Jobs for All = Peace on Earth

  2. hemen parekh says:

    Gender Bind / Unfair Share

    In Times of India [ March 08,2011 ], Ms. Rema Nagarajan provides following insights :

     Women own 1 per cent of the world’s wealth, have a 10 per cent share in global income

     Women comprise half the world’s population but occupy just 14 per cent of leadership positions in the private and public sector

     Of the 1.4 billion people living on less than $ 1 a day, 70 per cent are women and girls

     Women do two-thirds of the world’s work, but earn only 10 percent of the income

     Women produce half of the world’s food, but own just 1 per cent of its land

     Of the almost 900 million adults worldwide who can’t read or write, two-thirds are women

    Will mankind [ on “ Women’s Day “ 2011, should I say, womankind ? ] manage to bridge this gap by end of 21st Century ?

    With regards

    hemen parekh


    Jobs for All = Peace on Earth

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s