This is why you should care about the gender pay gap

The gender pay gap – while it looks like just a number on a page, it means so much more in reality. Ahead of Equal Pay Day this Wednesday 28 August 2019, it is important that we take a step back and really look at what the gender pay gap means for you, your family, your workplace and Australia.

What is the gender pay gap in Australia?

At the Workplace Gender Equality Agency (‘WGEA’), we calculate several gender pay gaps. For example:

National gender pay gap

14%

WGEA gender pay gap (full time total remuneration)

21.3%

Graduate gender pay gap (median salary data)

Undergraduates: 4.8%

Postgraduates: 14.6%

Lifetime earnings gap

38.8%

Why are there different gender pay gap numbers?

There are different sources of data and there are different ways to calculate it – these factors result in different but equally relevant gender pay gap figures.

The main differences between the national gender pay gap and the WGEA total remuneration gender pay gap are:

National gender pay gap WGEA gender pay gap (full time total remuneration)
  • Survey data (a sample of the total)
  • Covers organisations across all sectors and sizes
  • Only measures base salary
  • Census data (think of this as a 100% sample of the total)
  • Covers non-public sector organisations with 100 or more employees
  • Measures base salary plus any additional benefits such as superannuation, bonus payments, performance pay, discretionary pay, overtime, other allowances and benefits such as share allocations.

What is important to note is that regardless of what measure you use, there is a gender pay gap in favour of men. In fact, gender pay gaps in favour of men are a common feature of economies worldwide. You can see that both the national gender pay gap and the WGEA gender pay gap are vital to providing the whole picture in Australia.

But wait… what does it all mean?

The gender pay gap is commonly misunderstood to be two people being paid differently for the same work or work of the same value. This is not the gender pay gap, this is equal pay – something that is unlawful in Australia.

It is a measure of the difference between the average earnings of women and men in the entire Australian workforce.   

The gender pay gap is a symbol of women’s position in the workforce in comparison to men.

It is the result of different social and economic factors that have a tremendous impact on how women and men live their lives.

The causes

Discrimination and bias are just the tip of the iceberg when it comes to the causes of the gender pay gap.

To start with, there has been a historic and systemic undervaluing of women’s work. Often, female-dominated industries and jobs attract lower wages. This form of segregation prevails today and women continue to be slugged with an enduring undervaluation of female-dominate jobs whilst competing with barriers to attaining male-dominated jobs.

Women take on a disproportionate share of unpaid care and domestic work. Entrenched societal expectations, economic issues and enduring stereotypes steer women and men into the boxes of ‘carer’ and ‘breadwinner’, with little freedom to ‘choose’. Limited access to flexible work and paid parental leave, particularly for men, mean that women spend a greater amount of time out of the workforce, have a higher rate of part-time work and report experiencing high levels of work-family conflict. Men on the other hand, often miss the opportunity to enjoy better work-life balance and to fully realise their role as a carer for their children.

Men dominate senior leadership roles. Only 17.1% of CEOs are women, 25.8% of board members and 30% of key management positions. The leadership pipeline remains leaky as women’s caring responsibilities can interrupt career progression and opportunities, in addition to unconscious and conscious bias towards female leadership.

The result

The gender pay gap does not just impact a woman once in her life. It has a compounding effect that results in a woman’s reduced earning capacity over her lifetime.

On average, women are less likely to progress as far as men in their career and accumulate less money for retirement.

Women are more likely to spend their lives working, and caring for the home and loved ones. They are more likely to retire in poverty.

The key takeaway:

The gender pay gap is more than just a number. It is an important symbol of inequality, for women and men.

This is why the gap matters.