Bigger roles for women will close the gender pay gap

CEO Magazine

December 29, 2015
By Henriette Rothschild (Hay Group)

Australia has made considerable strides towards closing the gender pay gap, but a lack of women in ‘bigger’ roles continues to hold the country back.

At first glance, it may seem that Australia is finally on its way to closing the gender pay gap. Women’s salaries average just under 5% less than men working in comparable roles — a figure that is not statistically significant when it comes to employment data.

This may lead some to assume that we have finally achieved pay parity, but such an assumption is both untrue and unhelpful. When we dig deeper into the data from Hay Group’s recent Australian Salary Movement Index – which analyses more than 257,462 jobs from 410 organisations – we are faced with a more complex picture.

The data reveals that even if every man and woman was paid equally for the same work, the gap would remain. This is because woman are underrepresented in roles that command the biggest pay.

The prevalence of women in ‘small’ jobs, as opposed to the ‘bigger’, more technical or specialised roles dominated by men, is the single biggest factor in gender pay inequity.

When comparing the overall average weekly full-time equivalent earnings – before tax, excluding factors such as overtime and salary sacrificing – of men and women, we are no longer looking at a 5% difference, but an 18.2% one.

The solution

The solution is simple, though not easy. To close the gender pay gap we must increase female participation in male-dominated sectors and make senior roles more accessible to women.

In particular, we need to increase the number of women working in those sectors where science, technology, engineering and mathematics (STEM) skills are highly valued, such as resources, technology and specialised manufacturing.

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