Senior Partnerships Adviser
1 March 2017
A new analysis of Agency data shows that sizeable gender pay gaps persist across the workforce, but that improving gender balance in leadership teams measurably improves pay equity in organisations.
Gender Equity Insights 2017: Inside Australia's Gender Pay Gap, the second in the BCEC|WGEA Gender Equity Insights series, also reveals that male graduates are more likely to access high paying roles than female graduates.
WGEA Director Libby Lyons said the report revealed the highly segregated nature of Australia’s workforce, with men concentrated in traditionally ‘blue collar’ industries like mining, construction and women in traditional ‘caring’ industries of health care and social assistance – leading to poor pay equity outcomes.
“Traditional ideas around how women and men should engage with the workplace must change, if we are to meet the social and economic challenges in the decades ahead.”
Greater balance in leadership drives reduced gender pay gaps
Increasing the representation of women in executive leadership roles is associated with lowering gender pay gaps. Organisations with the lowest share of female executive leaders have an average gender pay gap double the size of those with an equal share of women in senior roles: 20% compared with 10%. Organisations that increased the share of women in executive leadership roles by more than 10% recorded a reduction in the organisational gender pay gap of 3 percentage points over the course of a single year.
Male graduates access higher pay
Overall, the median gender pay gaps for full-time graduate trainees are 2.9% on base salary and 2.1% on total remuneration. However, the gender pay gap for graduate trainees progressively widens among the top echelons of salary earners. The highest-paid 10% of women in graduate trainee positions receive at least $81,000 in base salary, whereas the highest-paid 10% of male graduate trainees took home at least $88,000.
Managerial gender pay gaps fall as the share of female managers increase….
The average gender pay gap declines as female representation among management increases. The managerial gender pay gap falls steadily from around 15% in total remuneration among firms where one-fifth of managers (20%) are female, to 8% for organisations where four-fifths of managers (80%) are female.
… apart from organisations with the highest concentrations of female managers
However, gender pay gaps are seen to rise sharply in workplaces with the highest concentrations of female managers. For organisations with a greater than 80% share of female managers, the management gender pay gap rises from around 8% to more than 17% in favour of men.
Men lag in part-time pay, except for managers
Not all pay gaps favour men. For part-time employees, women out-earn part-time men on average by 7.8% or around $4,000 a year. This pattern reverses at senior levels. For part-time managers, women earn on average 27.1% less than their male peers, with a wider gap of 34.7% in female-dominated work environments.
Mining the top paying industry for women
Australia’s most male-dominated industry delivers the highest pay to women. Women employed full-time in Mining earned on average $139,053 total remuneration in 2016. The next top-paying industries for women were Electricity, Gas, Water and Waste services ($106,100) and Banking and Finance ($105,438). The lowest paid industry for women was Retail Trade at $65,865.
$93k pay gap at the top of the ladder
The gender pay gap grows with seniority, climbing to 26.5% for Key Management Personnel (KMP), an annual difference of more than $93,000 in total remuneration. Pay gaps among managers are exacerbated by the greater share of discretionary pay awarded to men. For KMP, nearly $40,000 of the annual difference in pay is made up of additional remuneration including bonuses. The KMP pay gap reduced by 2.2 percentage points between 2014-15 and 2015-16.