The Workplace Gender Equality Agency (WGEA) has today released the new national gender pay gap figure of 14.2%, a rise of 0.8 percentage points over the last six months. This means Equal Pay Day 2021 will be on 31 August, marking the 61 extra days from the end of the previous financial year that women, on average, must work to earn the same annual pay as men.
Using the latest Average Weekly Earnings data released by the Australian Bureau of Statistics (ABS), WGEA has calculated the national gender pay gap as 14.2% for full-time employees. This equals a difference of $261.50 per week between women and men. The rise in the national gender pay gap was largely driven by a higher growth in men’s full-time wages (1.8% increase) than women’s (0.9%). The ABS highlights “the high average earnings growth in the Construction industry, which has a high proportion of men” as an explanation for this.
WGEA Director Mary Wooldridge said the increase in the pay gap was concerning and served as a warning to ensure continued focus, effort and commitment to drive it back down again.
“This Equal Pay Day, we’re calling on all Australians to ask #WhatsYourPayGap? in their workplaces and industries as a crucial step towards bridging this divide.
“Equal Pay Day is an ideal opportunity to remind employers around the country that one of the key levers of change is through gender pay audits. These audits help employers identify and address discriminatory pay, to ensure that women are equally compensated and valued,” she said.
“Research proves that regular audits close pay gaps faster. The 2021 Gender Equity Insights Report from BCEC and WGEA showed that employers who consistently did pay audits between 2015-20 closed their managerial pay gaps faster than all other companies. By contrast, those who stopped doing pay audits actually saw their managerial pay gaps increase.”
The WGEA Director said while research findings demonstrate that improving gender equality in the workplace brings clear economic benefits to companies and nations, importantly, the work of Australian women deserves to be equally and fairly valued in our workplaces as a basic principle.
“Closing the pay gap is about fairness. Our data shows women’s average full-time wages are lower than men’s across every industry and occupation in Australia. ’The gender pay gap signifies that the work of women is still not treated as being of equal value to that of men. As the 2021 BCEC-WGEA research report reveals, the sobering reality is that, on current trends, it will take 26 years to close the total remuneration gender pay gap.”
Along with urging action from employers, Ms Wooldridge is also encouraging employees to become active advocates on the issue in the lead up to Equal Pay Day this year.
“Take the first step to find out #WhatsYourPayGap? by going to our website and seeing if your employer has done a pay gap audit and acted on its findings. Start a conversation with your colleagues and friends about the gender pay gap, what it means to you and to them and how you can help to close it. We can all work together to eliminate gender pay discrimination,” she said.
About the national gender pay gap
The national gender pay gap measures the difference between the average weekly full-time base salary earnings of women and men, expressed as a percentage of men’s earnings. It is a measure of women’s overall position in the paid workforce and does not compare like roles.
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About the Agency: The Workplace Gender Equality Agency is an Australian Government statutory agency charged with promoting and improving gender equality in Australian workplaces. www.wgea.gov.au.
Background information on the new national gender pay gap
- The national gender pay gap is 14.2%.
- This is a 0.8pp rise from the previous gender pay gap of 13.4%
- On average, women working full-time earned $1,575.50 while men working full-time earned $1,837.00.
- Full-time average weekly earnings difference between women and men is $261.50.
What is the difference between the gender pay gap and equal pay?
Equal pay is the concept of women and men being paid the same for performing the same role or different work of equal or comparable value. In Australia, this has been a legal requirement since 1969.
The gender pay gap is different to equal pay. It measures the difference between the average earnings of women and men in the workforce. It is not the difference between two people being paid differently for the same or similar job, which is unlawful.
When we talk about the gender pay gap, we are talking about the difference between what men and women get paid, on average, across organisations, industries, and the workforce as a whole.
What is the aim of Equal Pay Day?
Equal Pay Day marks the additional days from the end of the previous financial year that women, on average, must work to earn the same as men earnt that year. It is a symbolic day that helps to raise awareness of the barriers women face in accessing the same financial rewards for their work as men.
Equal Pay Day is calculated by deriving the difference between women’s and men’s average weekly full-time earnings as a percentage of women's earnings and multiplying this figure by 365 days. This tells us the additional number of days that women must work each financial year to earn the same as men. This differs from the gender pay gap calculation, which is expressed as a percentage of men’s earnings.
In essence, the equal pay day calculations tell us how much less women earn than men, while the gender pay gap calculation tells us how much more men earn than women.
The Gender Pay Gap based on base salary or total remuneration?
WGEA calculates the national gender pay gap using the ABS Average Weekly Earnings data. This survey estimates adult average weekly ordinary time earnings (base salaries) and excludes information on a person’s total remuneration, such as overtime, bonuses, pay that is salary sacrificed and superannuation. WGEA calculates a gender pay gap on base salaries and total remuneration from our census of companies with over 100 employees. The total remuneration gender pay gap is consistently 5% greater than the one for base salary.
Which Average Weekly Earnings data is used?
Traditionally, the data used by WGEA for calculating the national gender pay gap is the Australian Bureau of Statistics (ABS) Full-Time Adult Average Weekly Ordinary Time Earnings Trend series from the Australian Weekly Earnings survey.
However, due to the impact of COVID-19 on the labour market, in 2020 the ABS has suspended the use of trend data until more certainty emerges in the underlying trend in earnings estimates over the COVID-19 period.
Instead, for the past 18 months WGEA has used the ABS’s seasonally adjusted average weekly earnings data to calculate the gender pay gap during the COVID-19 period.
Read the ABS’s explanation here about why they have suspended trend estimates during the COVID-19 period and find out more here about the difference between trend estimates and seasonally adjusted estimates.
What does the AWE data tell us about the current labour market situation?
The biannual AWE data is a snapshot in time. This survey was in May 2021 and there have obviously been changes since May as a result of the recent COVID-19 outbreaks. It is not a complete reflection of what has been happening in the Australian labour market.
This survey also only captures full time workers. It does not include part time workers or those out of the workforce. People who were usually employed full-time but have had their hours reduced as a result of COVID-19 will have left this cohort.