31st March 2020 is being observed as Equal Pay Day this year. There is an interesting story about how this day became a symbol of gender pay gap. In 1996, the National Committee on Pay Equity wanted to highlight the need for equal pay for men and women. Women on average earn less than men so they need to work longer to earn the same pay as their male team members. In order to represent the disparity of the pay, the committee chose it on the first Tuesday in April and called it Equal Pay Day. This Tuesday represents the extra days that women need to work over an entire workweek to earn the same salary as men.
“Latina women earn just 53 percent of white men”
Sections:
- What is Equal Pay?
- Gender Pay Gap by Industry
- Gender Pay Gap by the Level of Education
- Does Zero Pay Gap exist?
- Why is Gender Pay Gap still a Reality?
- How to Attain Equal Pay?
What is Equal Pay?
Equal pay means that men and women be paid equal sums of money for doing equal jobs. For some readers, it might seem trivial because they either assume that this problem will not have an impact in their field of work or they might think that this issue can be solved by policymakers. Here are some facts to prove otherwise:
- Based on data from the USA, women earn 81 cents for every dollar a man earns doing the same job.
- 78% of the largest companies in Britain reported a gender pay gap.
- The median salary of Indian men is 19% more than the median salary of Indian women.
However, there is some optimism. The gender pay gap has been decreasing. In 1980, women (aged 25-34 years) earned 33 cents less than their men counterparts while in 2018, they earned 11 cents less than their male counterparts.
This is good news but data also shows that the pay gap widens as age and work experience increases. The World Economic Forum reported in 2020 that it would take another 257 years to close the gender pay gap from all sectors across age groups.
Gender Pay Gap by Industry
Almost all sectors (both formal and informal) report the gender pay gap. The BBC was highly criticized when it released data regarding their top paid presenters and the proportion was widely in favor of men.
Top three industries where the gender pay gap is highest are:
- Agencies and Consultancies
- Retail and Customer Service
- Transportation
Gender Pay Gap by Level of Education
The lowest level of the gender pay gap as reported in the field of Law (data from USA). Top four levels of education where gender pay gap is highest are:
- Management post-graduates
- Non-management post-graduates
- Health care doctorates
- Doctorate (Ph.D.)
Does Zero Pay Gap Exist?
Yes, some companies do report Zero Pay Gap. At chocolate-maker Mondelez India, the gender pay gap is zero.
Their HR-Director, Mahalakshmi R. says, “Women are striving to be independent and seek equal opportunities on all grounds. Men are increasingly considering women to be equals in all aspects of life. We have ensured that we build no bias whatsoever in pay while recruiting and growing our female talent.”
Economic Times
Why is Gender Pay Gap still a Reality?
Although many legislations and policies direct companies to pay women the same salary as men, equal pay is still far from reality. A number of factors contribute to this.
- Social Factors: The educational system in most cultures teach gender norms in such a way that young girls are nudged to choose low paying jobs that are less valued. Society expects women to take up caring and nurturing roles like motherhood gaps or working part-time to take care of household chores and aging parents. This hampers earnings and dampens their career progress.
- Organizational Structure: In most organizations, the senior-level positions and highly paid positions have a skewed gender ratio. The representation of women in these posts is very low. Due to the glass-ceiling effect, most women are stuck in mid-management positions and never reach the higher levels. As a result, the median salary of women is lower in most organizations.
- Implicit Biases: These refer to unconscious biases about members of a particular social group. During hiring and compensation planning, executive decision-makers often fall prey to implicit biases against women. This them to offer less salary to women and hiring fewer women in top management positions.
- Poor representation of women in technical education: The representation of women in technical education (which leads to the highest paying jobs) is low. In the United Kingdom, only 12.37% of engineers in 2018 were women. Out of all women engineers, only around 21% of them work in core engineering jobs.
How to Attain Equal Pay?
- Whistle-blowing: Unless cases of unequal pay receive the attention of society, things are unlikely to improve. As employees of an organization, it is our duty to report cases of unequal pay based on gender or race so that the situation can be made better.
- Societal Changes: It is often seen that women voluntarily choose jobs that do not do justice to their educational and professional skills. This is because they are socialized into believing that their primary role in the family is that of a caregiver and not that of a bread-winner. This leads them to make career sacrifices which hinders their progress and earning potential. Parents and educators have a major role in this. They need to empower their daughters and students and make them understand that it is fine to make career first priority in life. At the same time, they must teach young boys that it is their duty to share household responsibilities and it is fine to be the primary caregiver of the family for men too.
- Encouraging women to pursue technical education: Most highly paid jobs (AI, Blockchain, Machine learning) require technical education. Worldwide data reveals a very low percentage of women in these fields. School educators and parents need to rise above gender stereotypes and encourage young girls to pursue technical education.
- Company policies: Organizational policies aimed at encouraging paternity leaves, creche facilities in the workplace vicinity and avoiding implicit biases while hiring and compensating would reduce the pay gap. Also, biases like women cannot be given work that required travel and women are soft-spoken need to be eliminated. Am inclusive organization needs to be created where employees are valued for their talent and contribution.
