Australian working women earn less than men from the moment they enter the workforce, and the gap is eroding their economic security over their lifetime.
It costs Australia billions of dollars a year and has for decades, yet we baulk when it comes to investing in the obvious solutions.
The fourth edition of the She’s Price(d)less: The economics of the gender pay gap report by KPMG, Diversity Council Australia and the Workplace Gender Equality Agency estimates the national pay gap at $966 million a week or $51.8 billion a year. That’s almost a billion dollars in earnings a week that working women are missing out on, and while there are various approaches and data sources to calculating the pay gap, they all favour men.
The gender pay gap is not two people being paid differently for the same job but a measure of women’s economic positions compared with men, resulting from social and economic factors that combine to reduce women’s earning capacity over their lifetime.
In real terms, Australia’s gender pay gap didn’t change between 2017 and 2020.
Gender discrimination remains the biggest driver of the pay gap, but together with the time women take out of work to raise children, care for family, run a household — and the higher likelihood of returning to work part-time to manage this unpaid care — it causes a cumulative effect on their careers and, therefore, their earnings.
Women also make up most of the workers in the jobs and industries that the pandemic showed us matter most, such as early education, health and aged care, but because they are feminised, they are simultaneously undervalued and underpaid.
We aren’t putting enough value on the care economy — that is, women in caring roles at home or work — and we’re all paying for it. Just last week, Victorian MP Steph Ryan quit politics for a position that would give her flexibility to juggle the demands of a young family.
Women are underrepresented at every level of government in Australia, and our report shows they are the minority in leadership positions in business. They’re also overrepresented in insecure, part-time, less senior and lower-paying roles — but not by choice. This must be rectified.
Australia’s gender pay gap is fixable, and the solutions within reach. Our governments and employers can tackle complex problems and they did so repeatedly during the pandemic. No one action will solve this, but a combination of reformative policies will make the difference that women and organisations such as Diversity Council Australia have been calling for.
Many women working part-time to balance careers and caring want more paid hours, and affordable, universal childcare would help — with the bonus of creating more jobs and taking financial pressure off households. Flexible and gender-neutral paid parental leave that encourages all parents to take time off and share the care of their children would disrupt gender stereotypes and support women to get back to work sooner.
Better funding for early education, health and aged care to make them better paid and more secure would get more women back to work and contribute to closing the pay gap and workforce shortages.
The cost of doing nothing will just continue and potentially worsen the gender pay gap. But it’s also much more than that. While the pay gap and the forces driving it are not new, this new data should be a reminder of why Australia’s industries, governments and communities must work together to tackle the systemic drivers of pay inequity.
Targeted strategies, policies and initiatives are required and specific responses from businesses, employers, industry bodies and government to create meaningful change.
Acting with purpose now would not only invest in our nation’s future economic prosperity but also help overcome current and future economic headwinds.
Key drivers of the gender pay gap in 2020
- Gender discrimination accounted for 36% of the gap, or $348 million in weekly earnings, compared with 39% in 2017
- Care, family and workforce participation accounted for 33% of the gap, or $319 million in weekly earnings, compared with 39% in 2017
- Type of job (occupation and industry) accounted for 24% of the pay gap, or $232 million in weekly earnings, compared with 17% in 2017.
I’m shocked and stunned that KPMG, paid a healthy sum no doubt by Diversity Council Australia and the Workplace Gender Equality Agency found such a gap. Now with a new ‘KPMG’ badged report, the clients can continue to prosecute this trope via the usual channels.
Equally amazing is how the only conceivable solutions to the ‘gap’ are more public funding and platitudes about working together.
Here’s a ‘solution’: much lower land and energy prices – major input costs for everything – would allow for increased working and middle class family formation on a single FTE salary which could be done by either husband or wife in our current age.
Oh, but that would mean lower corporate profits to pay for Diversity Council Australia membership which includes banks, super funds, insurers, miners etc.
It is very hard to take this seriously. Most men would not earn what they earn without a longstanding relationship with a single employer. Or a de facto situation which gives them value potential. You have to discard that value stream and replace it with some pretty amorphous notions. Looks like some errors in the logic and the reasoning. And a healthy dose of discrimination against males.
Given that women have only been allowed to remain employed [in the public service] post marriage since 1966 (so as not to take jobs away from men – even jobs thought to be too mundane for them such as typing? – and to enforce the view that women should not evade their domestic responsibilities), it’s difficult to understand how a woman could have been allowed to develop a long standing relationship with their employer in an equal way to men. Women have only been allowed a mortgage without a male guarantor since the 1980s. Casual and part time jobs (mostly women) continue to make bank approvals difficult. Perhaps you might add these considerations to your logic and reasoning?
I haven’t seen anything that contradicts the fact that more women take on and remain with lower paid work as a choice.
Most have a partner providing the bulk of income to the family unit.
Most have responsibilities with family that they retain rather than share.
Most choose to not do further education.
Most would want more money but do nothing to upskill / retrain.
Saying the gender pay gap is real and not quantifying the actual numbers demonstrating some truth is debilitating to the argument for equal pay for equal work.
It is a fact that lower paid jobs – regardless of the occupant gender – are largely held by women.
Many of the loudest mouths on this topic are academics who do not reflect the workforce on anything other than paper.
Medical staff and other emergency workers should be paid more regardless of gender and this in itself would help to reduce the pay gap.
The headline said “……it’s easy to fix”. The solutions that were (kind of) offered were vague at best. Predictable spin by someone leading an industry of consultants and “experts” milking the issue for their own benefit. Interesting to see that 20 out of 22 members of the Diversity Council “team” listed on their website are women. As they say, people who live in glass houses shouldn’t throw stones.
In the “key drivers” what does “gender discrimination” mean? Is it that men are getting the jobs that women should be getting?
Or in statistician speak, the proportion of variance of income unexplained by our model. Gender discrimination probably accounts for some of it, but few statisticians would be willing to claim that gender discrimination accounts for all of it.