Gender Pay Gap in 2020

Historical Gender Pay Gap

As of November 2020, the women’s average remuneration in Australia across all industries and occupations is about 30% less than men’s. Even though the GPG is continuously trending downwards, it still ranges between 29% to 35% in the past few years.

GPG by Industry - Almost All Industries have a GPG in Favour of Men

Professional, Scientific & Technical Services, Financial & Insurance Services, Health Care & Social Assistance are industries with top 3 GPG in 2020.

> While it is obvious that GPG does exist in Australia as seen above, why is that the case when there are regulations regarding pays in an organisation?

Occupational Segregation

Historically, gender in Australian workplace has been fairly distributed between males and females. Below is an indicator of the distribution of gender across 2014 to 2019.

Despite the equal participation in workforce, industries are highly segregated by gender. Women are concentrated in Health Care and Social Assistance, Education and Training, where men are represented in Construction and Mining. Across the 19 industries, only 8 industries are composed with at least 40% women and men. All other industries are highly segregated by gender with at least 60% of a specific gender as shown in the bubble chart below. Bubble size is an indicator of the total employment in that industry.

At the micro-economic level, this segregation substantially contributes to the gender pay gap in Australia as most of the highest paying occupations are dominated by males while most of the lowest paying occupations are dominated by females.

This finding is shown below with the colour of cells indicating the dominated-gender of the industry.

An interesting finding is that gender pay gap also differs across states due to the industry profiles of each state.

For example, Western Australia has the widest gender pay gap at 21.8% as the largest industries in Western Australia is Mining and Construction where they are high-paying and male-dominated.

Lack of Women in Leadership

In 2019, proportion of females participating in Australian workforce is 50.2%. However, proportion of females in leadership positions is sitting only at 39.4%, with more than 60% of leadership positions taken by males.

Below is the participation in leadership positions by gender.

In 2019, there were 25 CEO appointments and only one of them was female.

Now that we know the reasons behind the GPG in Australia, can we fix it?

Public Education

Both conscious and unconscious bias can disadvantage women and contribute to the gender pay gap. These can include ingrained assumptions about what women or men are capable of performing.

According to Australian Human Right Commission, 72% of all Australians and 85% of Australian females have experienced sexual harassment and/or discrimination in their lifetime due to these bias circulating in the society. A survey by Australian Human Right Commission has also indicated that Almost two in five women had been sexually harassed at work in the past five years (survey done in 2018).

The biases that has been long circulating in the society has disadvantaged women in hiring, promotion and performance evaluations and can result in lower starting salaries for and negative salary negotiation outcomes for women.

As a result, gender equity education should be promoted through government bodies as well as employers to achieve the absence of gender differences in educational outcomes (StateUniversity 2020)

Employer Support

Gender pay gap can also be closed via employers’ actions and support. In the past few year, more employers have been analysing their payroll data as well as establishing policies and strategies on pay equity.

Below is a treemap showing some actions employers have been undertaking where the size of the box represents the percentage of participating employers.

On top of employer’s actions on pay equity, some employers have also offered flexible working and parental leave as women, on average, handle a disproportionate share of unpaid care and domestic work.

In Australia, for every hour Australian men commit to unpaid care and domestic work, Australian women commit one hour and 48 minutes (Workplace Gender Equality Agency).

Even though new generations of men are more keen to share the unpaid care work with their family and partner, research by Bain and Company shows that men are twice as likely as women to have their requests to work flexibly rejected. To resolve, employers’ flexible working and parental leave should be introduced for both men and women.

As of 2019, only 26.8% of employers have a flexible working arrangements strategy for both women and men.