The Alphabet

G is for Gender Pay Gap

Gender pay gap

It’s 6:00am on a Monday when I wake up to an iPhone alarm on my parent’s couch. I hear creaking upstairs.
My brother and I have woken up at the same time.
He throws coffee down his throat. I throw coffee down mine.
He gets dressed. I get dressed.
He combs his hair. I comb my hair.
He leaves. I do my makeup.
I put the dishwasher on.
I line the bin with a bin bag.
I leave.

What is the Gender Pay Gap?

Australia measures the Gender Pay Gap using data from the Australian Bureau of Statistics (ABS) – specifically, the ‘Average Weekly Earnings’ (AWE) dataset, which is updated twice a year. AWEs are calculated by asking a sample of 5,700 employers what they pay their workers. The employers are picked across states and different industries and sectors.

Within the survey, employers report the weekly wage or salary of their full time employees. The ABS averages it out. They also ~disaggregate~ the data, which means they take the AWE of all employees, as well as just men, and just women. The latest AWE data is from November 2015. It showed that men in full time work were earning $1602.80 per week, and women were earning $1,325.10 per week.

The gender pay gap is found by taking the percentage of women’s earnings as a part of men’s earnings ($1,325.10 divided by $1602.80), and taking the difference. According to this measurement, women in full time work earned 82.67% of men’s full time earnings, so the gender pay gap is the remaining 17.33%. Since 1995, the official gender pay gap was between 15% and 19%. It peaked at 19% in 2014.

Can we trust this statistic?

The economist in me acknowledges that calculating the gender pay gap in such a specific way means that feminists and misogynists can critique it. The feminist in me is dismayed to see Google’s search suggestions of ‘the gender pay gap’ – suggesting the latter group may be working harder to confirm their bias:

pay gap myth

The Gender Pay Gap ‘Myth’

The ‘gender pay gap myth’ is arguable, but does not disprove gender conditioning. It stems from research that quantifies how much gender can account for differences in pay between men and women, all else being equal. There is very little pay difference between men and women doing the same work when they are similar in every way except gender.

The problem with our society however, is that not everything can be held equal. US public-policy scholar Anne-Marie Slaughter argues that a large portion of the gender pay gap comes from females taking on care responsibilities. This doesn’t happen straight out of university, but by 10-15 years out, women are much more likely than men to seek flexible work, which allows them to care for dependants such as children or aged parents.

Income and opportunity are lost when going into more flexible, part time work, so we begin to see a large disparity between men and women working in the same fields. The kinds of workplaces and jobs that offer more relaxed, flexible working conditions sometimes have less value, and are compensated less.

A Feminist Critique of the Gender Pay Gap in Australia

The official gender pay gap only looks at full time employees. To do otherwise would be difficult, but only observing full time work is problematic. Here’s why:

At March 2016, female workforce participation was 59% (male participation was 71%).
Of the women in the labour force, 44% of them – almost half of them – were in part time work. Of the males engaged in the labour force, only 17% were in part time work. Of all the people in Australia working part time, most of them are women. 69% of them, in fact.

Part time work is pays less, because fewer hours of paid work are taken up. I stress paid work, because women tend to do a larger amount of unpaid domestic work. Therefore the official gender pay gap statistic discounts a large group of low paid workers, most of whom are women.

The AWE of women across all types of work was $915.30. For all men across all types of work, it was $1374.10. So the gap of average weekly earnings between the genders as a whole is closer to 33% – nearly double the official pay gap.

Lower income for women has implications for their long term wellbeing. Superannuation is a good example of this, because it is calculated as a percentage of earnings. Academics argued female Australian baby boomers will spend 35% less time in paid work than men, and subsequently the disparity in superannuation between genders will be of a similar magnitude.

Something else to consider: AWE data, from which the gender pay gap is calculated, excludes casual work where women are also disproportionately represented. AWE data excludes business directors who earn dividends or shares as opposed to a salary. The Australian Institute of Company Directors reported only 22% of board directors at February 2016 were women. Essentially, the official gender pay gap statistic exempts many low paid women and very highly paid men.

Another frustrating element of the gender pay gap is how men and women often get paid different amounts for the same work. An ANZ #equalfuture campaign for International Women’s Day highlighted this cruel reality by getting kids to do chores and then paying the girls less than the boys. “This should be illegal” said one girl, while another said “If I was a boy and I got more money I would ask why they got less money than me.” The combination of innocence and outrage in this video highlights just how backwards the whole system is.

As well as the gender pay gap, we should examine the broader gender perceptions causing it. Why does the burden of care taking and domestic duty fall on a particular gender? Why do women help where the man helps himself? Workplaces are beginning to treat care responsibilities with gender neutrality, offering paid parental leave to men or women. But will men necessarily take up such an offer?

Growing up, I was always called upon over my brother to help mum with housework, just as the burden was on her. Individuals must also change their perceptions of gender responsibility. Just as workplaces can create better structures to foster equality, an enforceable chore roster can go a surprisingly long way.

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About the author

Eliza Owen

Eliza Owen is a housing market analyst and freelance economic reporter. She holds a first class honours degree in economics from the University of Sydney. Eliza has been a guest speaker on Triple J’s Hack, 702 ABC radio, Sky News and at TEDxYouth Sydney 2015. Eliza provides comment for the Australian Financial Review, The Guardian, Pedestrian TV, the Daily Telegraph and more.

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