The gender pay gap – it’s not that simple!
by Kara McGann, Labour Market Policy, Ibec

The gender pay gap in Ireland is 13.9% according to Eurostat, less than the EU average of 16.7% but still a significant gap. Reporting this gap can lead to concerns that women are “working for free” one month of every year or that women are earning less simply by virtue of being born female. The reality is it’s not that simple.

 

The gender pay gap refers to the difference between what is earned on average by women and men, based on average gross hourly earnings of all paid employees. It compares the pay received by all working women and by all working men; not only the pay of women and men in same or similar jobs, with the same working pattern or with similar competencies, qualifications or experience, but all the men and all the women working in an organisation. It does not indicate or mean discrimination, or an absence of equal pay for equal value work[1].

The reasons for a gender pay gap can be multifaceted and tend to cover four key, interrelated areas.

 

1)      Gender segregated labour market

By and large the gap is a reflection of the persistent gender segregation of our labour markets. A number of sectors and jobs continue to be dominated by men or women, which is first and foremost due to traditional gender roles in society and the different educational and career choices of men and women.  For example, according to the OECD, the low proportion of women in science, technology, engineering and maths (STEM) fields of study and employment makes a significant impact because graduates of these fields are in high demand and as a result the related jobs tend to be highly paid. This occupational segregation thus lends itself to a gender pay gap.

 

2)      Balancing work and family life

Women’s ability to participate in the labour market is constrained by the fact that they spend more time on unpaid work, four times as much on care work (time spent to care for a child or another adult) and twice as much on household work, than men, regardless of the employment status of partners[2][3] making them less available for participation. Career gaps can result in a “motherhood penalty” occurring[4] due to interrupted employment, detachment from the labour market, possible deterioration of skills and networks, and loss of opportunities for training, promotion and salary increments that would be gained while in employment. These can contribute to a gender pay gap and a lack of gender balance in decision-making roles.

 

3)      Availability of quality, affordable childcare facilities and out-of-school hours care

The cost of early childhood care and education in Ireland for parents is among the highest in Europe; is a barrier for families across a range of salary levels not just those on lower incomes and represents the largest additional household cost associated with taking up employment.

 

In addition to affordability, the availability and quality of childcare may collectively feature in a parent’s decision to work or return to work. Currently in Ireland, despite an increase in investment in this area, the service provided in early childcare and education is not consistently appropriate for the children or parents looking to avail of it[5]. It occurs at pre-school age and throughout school going years including logistical arrangements for getting children to out-of school hours care. Again research tells us that many decisions to come out of the labour market to deal with such challenges for a period of time often fall to the mother.

 

4)      Over-representation of women in part-time roles

While working part-time can reflect personal choices, the high share of female part-time employment may also stem from multiple constraints, including family and care-related reasons[6]. Research on gender pay gaps reports that one of the main reasons for the gap is due to the issue of women having a lower level of human capital and working fewer hours. While educational attainment is often higher amongst females, it does not offset the loss of work experience. Where females are working reduced hours this ultimately equates to less experience, reduced benefits value (pensions/bonuses which are usually linked as a percentage of basic salary) and therefore can generate an earnings gap that is greater that their male counterparts.

 

So how do we tackle the gender pay gap?

The proposed transparency measure of published wage surveys is not a useful mechanism for tackling gender pay gaps as it oversimplifies a complex issue. It not only puts an administrative burden on employers but may report a gap where justifiable reasons are at play rather than discriminatory behaviour. It may be a useful diagnostic tool to start conversations in the organisation but it will not address or solve the fundamental issues causing the gender pay gap.

 

The debate needs to be focused on the real issues and the structural and cultural changes we need to make as a country if we are serious about tapping into the full potential of our male and female talent. Some of those changes include:

 

  • Addressing the gender norms and stereotypes that remain regarding educational subject choices and career decisions of men and women. To see real progress, we need to challenge occupational stereotypes by encouraging more women into male dominated industries and investing in careers advice that provides real information and options to students. This requires interventions in teacher training, career guidance and raising awareness in parents and students alike.
  • Changing the socialisation of men and women, boys and girls regarding what a successful male or female looks like. The current model, which even in dual career couples sees women as the primary caregivers, fails to enable either gender to act outside gender norms without a backlash. In reality the backlash towards men is even more severe as a female temporarily stepping back from her career progression for a caring role is still seen as an acceptable or good female, whereas men report greater pressure and a narrower definition of masculinity, and if they step back believe often they are viewed negatively by other men, a “lesser man”[7]. This needs to begin by addressing gender stereotyped norms with children and young people.
  • Addressing the provision of high-quality, available, affordable childcare facilities, out of hours care arrangements and other public services should be strengthened by government and public authorities. There are a number of specific interventions required to tackle costs, availability and quality within the early education and childcare sector[8].
  • Challenging the experiences of career returners and ensuring that the period of time they have stepped away from their career does not relegate them to a position much lower than they left or find them unable to recover from such a break. Career returner programmes may bridge the gap for individuals and organisations to address this challenge.


[1] Employers have a key role to play in eliminating unjustified pay inequalities and a responsibility to comply with the legislation on the subject where there is ample redress if discrimination has occurred.

 

[2] http://www.oecdbetterlifeindex.org/topics/work-life-balance/

[3] https://www.imf.org/external/pubs/ft/sdn/2013/sdn1310.pdf

[4] Stewart 2013

[5] For further details Ibec (2016) Labour Market Participation of Women.

[6] Employment and Social Developments in Europe Report 2013 — ESDE 2013: pp 185

[7] The Economist (June/July 2017), The Man Trap. Pp 90-95.

[8] Ibec (2016) Labour Market Participation of Women.

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