Why are women paid less and what can we do about it? Catalina Consultants’ Merilyn Speiser reflects on a recent KPMG and Diversity Council report into the gender pay gap.
Women are still paid significantly less than their male counterparts for performing the same work. Perhaps even more disturbingly, the main reason could be classified as out-and-out discrimination. That’s what was outlined in a recent joint KPMG and Diversity Council report into the gender pay gap, the unfortunately named She’s Price(d)less.
How big is the gender pay gap?
According to the report, the hourly pay gap between men and women in 2017 was $2.43 or 7.8%. The good news is that this gap has fallen from 10.2% in 2014. However, what is most interesting is that it has actually risen over the past decade. In 2007, the gender pay gap stood at 6.7%; 1.1% lower than the most recent figures.
When you look at the weekly gender wage gap, the situation becomes more pronounced. Here, women earn an average of 14% less than their male counterparts for doing the same work.
Why are women paid less?
The report found that discrimination alone accounted for a whopping 39% of the reason women are paid less. In other words, many employers still treat men and women differently – whether consciously or unconsciously.
The other significant factor was that women still perform more of the carer and family responsibilities than men. This means they’re more inclined to work part-time or just fewer hours. This accounted for another 39%.
Finally, industrial and occupational segregation was responsible for 17% of the gap. This is partly down to women being overrepresented in low paying sectors and roles, such as childcare, cleaning and administrative jobs. Unfortunately, they also are often still less likely to be in leadership positions regardless of the sector in which they work.
Does the gender pay gap exist in your workplace?
The gender pay gap is a reality in many workplaces – often even without the business owners and managers knowing anything about it.
If you want to find out whether you’re one of the businesses unwittingly perpetuating this problem, the report recommends that an important first step you can take is to do a wage audit. This involves working out exactly what everyone is paid in your organisation and comparing the salary of people performing similar roles at a similar level.
It also recommends introducing greater transparency around pay – something gaining increasing popularity with employers around the world. That way you can compare like for like and everyone can see exactly where they stand.
What can you do to reduce the pay gap?
Beyond this, the report has a number of recommendations on what employers can do. These include:
- Tackling discriminatory practices head-on through your hiring and recruiting processes, as well as through access to employee development and training.
- Improving work/life balance and increasing the availability of flexible work.
- Enhancing the availability and uptake of shared parental care.
- Increasing the number of women in leadership roles, including through targets and quotas or other diversity policies.
- Changing your workplace culture to address unconscious bias.
- Developing networks of advocates for pay equality across the organisation.
And what should we be doing more generally?
The report also suggests that government and society more generally have key roles to play in overcoming the gender pay gap. This includes:
- Bringing down the cost of childcare and making it more accessible so that women are more inclined to return to the office full time; and
- Reducing disincentives to workforce participation in the tax system and via family payment and childcare support systems.
The economic benefit in overcoming the gender pay gap
The report concludes that there should also be tangible economic benefits if we can overcome the gender pay gap. In fact, the pay-off to the Australian economy could be as large as $60 billion by 2038. And the flow-on effects could deliver a $140 billion lift to our living standards.
In other words, overcoming unequal pay won’t just be better for women, it will be better for business, better for our standard of living and ultimately better for everyone.
Merilyn Speiser is Principal Consultant at Catalina Consultants, which can assist practices to perform their own pay gap audit or discuss HR strategies for overcoming the pay gap in the workplace.