Recently released earnings data from the Workplace Gender Equality Agency (WGEA) indicated a gender pay gap as high as 45% among managers. Yet basic myths continue to obstruct informed debate about why the gap exists.
Myth 1: Women are less qualified due to interrupted careers.
This myth has been debunked by a wide range of labour market studies which investigate whether women receive the same labour market rewards as men with similar qualifications, experience and personal characteristics.
Both in Australia and internationally, such studies consistently show that only a small proportion of the earnings differences between women and men can be explained by differences in education and work experience or other productivity related characteristics.
While it has been assumed that women’s poorer earnings relate to their lower levels of education and qualifications, recent data demonstrates clearly that the earnings gap has persisted despite women’s increased entry into higher education.
Today a higher proportion of women (26%) than men (22%) hold a Bachelor Degree or higher qualification, while a higher proportion of women (42%) than men (36%) are currently engaged in undergraduate education.
Grading earnings data indicates also that the gender earnings gap cannot be simply equated to women choosing to have children. Relevant here is the evidence of a persistent gender pay gap among graduates in their 20s, a period that predates career interruptions due to childcare.
Myth 2: The statistics are wrong. Organisations treat all employees equally and pay them fairly.
The statistics are not wrong. The WGEA data is derived from the data organisations have provided to the Agency. The strong story to come out of this evidence is of ongoing gender pay inequity, and its cumulative impact on women’s current and lifelong earnings. Even allowing for the different labour economics paradigms used to investigate the gender pay gap, a significant proportion of the earnings gap remains unaccounted for by what economists term “measurable characteristics”.
The determinants of the gender earnings gap cannot be easily reduced to a single factor. Contributing factors to the gap include the undervaluation of feminised work and skills, differences in the types of jobs held by men and women and the method of setting pay for those jobs, and structures and workplace practices which restrict the employment prospects of workers with family responsibilities.
Looking at management and leadership positions within organisations, a number of key barriers to the earnings recognition of women in leadership positions and their progression within leadership structures have been identified. These include negative perceptions about competing work-life priorities and women’s ability to lead.
These perceptions not only rest with individuals within an organisation but are embedded in organisational structure and practices. Within organisational settings, unconscious biases specifically related to or informed by expectations about what is appropriate behaviour for men and women, including masculinised models of leadership, do have a systematic and sustained negative impact on women.