What is the gender pay gap?
The gender pay gap is the average difference between the earnings of working men and women. Women are generally perceived as earning less than men. The gender pay gap, also known as the gender wage gap.
The gender pay gap is a widely-known indicator of women's economic position relative to men. It is the result of the social and economic factors that converge to which the earning capacity of women during their lives. There are two different numbers regarding the pay gap: unadjusted versus adjusted pay gap. The unadjusted gap is the overall difference in average pay for men and women. The adjusted pay gap takes into account the age, level of education, years of work experience, profession, sector, place, organization and job status of an individual and the calendar year of the recorded wages.
Does the gender pay gap exist?
It is generally perceived that men are paid more than men. In a BBC gender pay gap case study (2017), the BBC produced a report stating the wages given to its top employees. All top seven earners were males, with the highest top-paid man earning two million pounds. However, the most paid woman was getting 500,00pounds, a quarter of what the highest man was paid. It is difficult to understand why the woman was being paid much less than the man despite both of them being presenters. This signifies the existence of the gender pay gap. In their next annual report(2018) The salary between men and women has reduced, with the number of women paying more than £ 200,000 rising from 7 to 14, and the number of men earning more than £ 500,000 declining from 5 to 3. The pay gap might have reduced but it still exists.
In a research done by Payscale (2019), in their summary of key findings, they discovered that women are often getting low-level jobs, and are still being paid low and are less valued than a man in the workplace. Women have very fewer opportunities for developing their careers much unlike men. It is also noted that employers tend to undermine degrees obtained by women than man, hence they pay them less. In other terms, men's median wages are about 21 percent higher than women's median wages. This figure represents an increase of one percent from 2018 and a change of 5 percent from 2015 when men's median salary was about 26 percent higher than women's median salary.
The pay gap widens as women get older. Women aged 55–64 are compensated 78 percent as much as men of the same age, more than double as much as women aged 20–24 years. Earnings continue to grow with age for both female and male full-time workers, although they climb more slowly after age 45 and fall again after age 55.
What is the mean gender pay gap?
The mean gender pay gap is the difference between the average hourly earnings of men and women.
How is the gender pay gap calculated?
Usually, the gender pay gap is determined by first combining all of the annual salaries of women who work full-time, year-round, and then calculating the median salary — that is, the salary that is in the exact middle, with 50% of women earning more than that amount and 50% earning less. Repeat the same calculation for men to find their median salary. Then calculated the pay gap.
The median gender pay gap is also calculated by listing all male and female employees’ earnings from highest to lowest and comparing the number that sits in the middle for each gender. The difference in salary between those two people is the pay gap figure.
The mean gender pay gap is average. It’s found by adding up the wages of all male and female employees and dividing it by the total number of employees. The pay gap is the difference between the mean figures for men and women, which is presented as a percentage.
Given that the mean gender pay gap can be biased due to the presence of highly paid employees, it is not very expressive to the gender pay gap. Hence so, the median gender pay gap is the one that is widely used.
Reasons behind the gender pay gap
- Women choose to work in low-paid roles and sectors.
It is mainly perceived that more poorly-paid jobs are those traditionally done by women, requiring skills traditionally regarded as ‘feminine’, such as people skills and caring skills, for instance, nurses and teachers. While man chooses to be engineers, doctors, those that require more skills hence more wages. This results because people undermine women skills
- Women are paid less than men for the same role
The gender pay gap is based on the difference between the average hourly pay rate for men and the average hourly pay rate for women, largely due to the reasons mentioned above.
- Caring responsibilities are shared
Women are the ones usually taking care of the children, therefore they end up working in jobs that are below their skills, with poor progression opportunities.
In an article written by Federico Anzil (2018), the main sources of the gender pay gap are the fact that, on average, women and men commit to a different number of hours to their jobs, especially after parenthood and marriage.
Ways to reduce the gender pay gap
- Encouraging women entrepreneurship
Providing skills development and training could improve women marketing
- Use of Daycares
Should practice sending children to daycare once they reach 9months so as to give women more time to improve their skills and work more paying jobs.
- Government should interfere
The government should enforce laws that force employers to publicize information on the percentage of female employees, male employees, and the gender percentage pay
- Use skill-based assessment tasks in recruitment
Use candidate’s performances on the job role tasks to access their sustainability on the job rather than relying on interviews only. Ensure fairness on the task across the candidates.
- Encourage salary negotiation by showing salary ranges
Employers should state clearly the salary range for the job on offer so that women can find it easier to negotiate their wages.
- Introduce transparency to promotions, pay and reward process.
The employer should be open about the organization`s policies, criteria and processes for decision making. This means that employees are clearer on what is involved.
These actions will help reduce pay inequalities.
Keithley Tongai is a Consultant intern at Industrial Psychology Consultants (Pvt) Ltd, a business management and human resources consulting firm.