The gender gap nears $1 billion per week

The latest edition of She’s Price(d)less: The economics of the gender pay gap shows that accounting for labour force participation rates and incomes, the national pay gap is estimated at $966m per week or $51.8b per year.

The joint report released recently by KPMG, Diversity Council Australia (DCA), and the Workplace Gender Equality Agency (WGEA), is the only analysis of its kind in Australia that evaluates the contributing drivers of the gender pay gap to explain why the gender pay gap exists, and what needs to be most addressed to close the gap.

The analysis, based on the Household Income and Labour Dynamics in Australia (HILDA) survey, shows gender discrimination remains the leading driver of the pay gap, contributing 36% of the $2.56 hourly pay gap. Other key pay gap drivers are caring for family and workforce participation (33%) and the type of job and industry sector of employment (24%).

KPMG Chairman, Alison Kitchen said, “Since our last report in 2019, the gender pay gap has remained stubbornly unchanged despite action across the public and private sector to tackle gender inequality. This report shows that gender discrimination continues to be the single largest contributor to the gender pay gap. It also shows a worrying trend in the rise of industry and occupation segregation. We must collectively increase our efforts to build a better and fairer Australia.”

For the first time, She’s Price(d)less has used data from WGEA’s workplace survey and data published by the Australian Bureau of Statistics (ABS), alongside HILDA data, to explore how the gender pay gap impacts five different industries.

Mary Wooldridge Director WGEA, said, “Greater action by employers to address the systemic drivers of the gender pay gap is an investment in our future economic prosperity. Actions employers can take today include undertaking gender pay gap audits and actioning findings, increasing the share of women in leadership positions, and enhancing availability and uptake of parental leave and flexible work by men and women. WGEA collaborates with employers making these changes and seeing real, tangible benefits for their workforce and for their business.”

The glass ceiling

The report also includes an analysis of the gender pay gap by income quintile, which shows gender discrimination, lack of opportunities for promotion, and underrepresentation in management impact women throughout their careers.

It also reveals that women at the start of their career experience a pay gap of 6% but as they progress through their careers to top management levels, the pay gap increases to a high of 18%.

DCA CEO, Lisa Annese, said, “To act with purpose in addressing the gender pay gap now would not only invest in our nation’s future economic prosperity but also help overcome the tough economic conditions we face.

“Action now is particularly important for low paying industries where women comprise the workforce majority, such as healthcare and education, which we rely on in our daily lives.”

Industry snapshot

The report’s analysis across five key industries (Healthcare and Social Assistance, Education and Training, Retail Trade, Manufacturing and Accommodation and Food Services) shows how gender pay gaps remain prevalent regardless of labour force size, gender composition or average rate of pay.

It also finds that women in feminised industries also face barriers to achieving wage parity, with gender pay gaps above the national average and underrepresentation in promotions and key management positions.

Actions to effect change

The points below reflect the opportunities for closing the gender pay gap revealed in the report.

Gender discrimination

• Eliminating workplaces sexual harassment, every-day sexism and gendered violence.

• Addressing discrimination in work practices such as hiring, promotion and access to training.

• Increased pay transparency and reporting on gender pay gaps.

• Undertaking gender pay gap audits and actioning findings.

Gender segregation in job type

• Breaking down social norms regarding what roles and industries are appropriate for men and women.

• Addressing wage inequality in feminised industries.

• Increasing the share of women in leadership positions, including through targets or other diversity policies.

• Developing networks of advocates for gender equality among men and women who can address barriers and affect change.

Care, family responsibilities and workforce participation

• Improving work life balance, increasing availability of flexible work.

• Increasing availability of childcare and decreasing cost.

• Enhancing availability and uptake of shared parental care.

• Reducing disincentives to increasing workforce participation through personal tax, family payment and childcare support systems.

• Changing workplace culture and addressing unconscious bias.

• Rethinking and redesigning part-time roles for managers.

The She’s Price(d)less report shows that greater action by industry, the community, and governments to address the systemic drivers of the gender pay gap is both a collective obligation and an investment in Australia’s future economic prosperity.