Gender pay gap not quite what it seems
It isn’t a myth dreamed up by social justice warriors, but it’s not a sinister plot hatched by the patriarchy either.
trusted with their data.
He picks his words carefully. Jude does not want you to trust your money to it, he says. Banks will still be the custodians of the cash.
Instead, open banking might automatically move money between accounts to avoid the likes of unauthorised overdraft fees, or they can pay your rates or power bill at the last minute before you lose the early payment discount.
Karen Scott-Howman from the Bankers Association says of open banking: ‘‘If it is good for our customers, it is good for us.’’
She says early stage conversations between regulators in Wellington and banks are under way on open banking.
‘‘We are very open to have conversations, but so far there’s no regulator which has consulted publicly on it.’’
Lynch expects an open banking revolution.
‘‘Software has changed the world in the last 10 years, but it hasn’t really touched financial services yet,’’ he says. ‘‘There’s going to be some pretty interesting new business models pop up, and old business models die. What the consumer wants, the consumer gets. Maybe in five years’ time, when we think about retail banking, and we say ‘Who do you bank with?’ It will be in the sense of who do you trust with your data.’’ WHENPrime Minister Jacinda Ardern was on the campaign trail, she promised her party wouldn’t rest until men and women reached pay equity.
I don’t think they’ll be resting any time soon.
Last week we looked at how goods and services for women are often priced higher than the exact same items for men. Not only are women subject to this pink tax they also earn 12 per cent less than men, on average.
This is not up for debate. The figure comes from a study commissioned by the Ministry for Women. The gender pay gap is a real thing that exists.
Well, yeah, but don’t men work longer hours, in different occupations and industries?
The authors controlled for that.
OK, but don’t women tend to choose lower-paying careers?
The authors controlled for that.
Sure, but what about differences in age and ethnicity?
The authors controlled for that.
But what about education? Family structure?
The authors controlled for those, too.
Once you take all of these factors into account, only 20 per cent of the gap disappears.
The vast majority of the disparity remains ‘unexplained’ – to use the authors’ careful choice of words. Of course, that didn’t stop everyone jumping in to fill the void with their own beliefs. Some headlines proclaimed that ‘‘bias against women’’ was solely to blame for the missing 80 per cent, directly contradicting the actual report. Outraged commenters responded by saying the whole thing was a myth, and nothing more than natural differences between men and women. What’s really going on? A close reading of the study gives us a few clues. At the lowest levels of income, there is no pay gap – if anything, women might actually earn more than men. The gap starts to widen as you move along the age and career spectrum. Older men are paid much more than older women, as are the top tiers of earners – the business people and lawyertypes. Women are more likely to take time out of the workforce to raise kids, which can have a big impact on career prospects. Dads earn more than mums. Is this ‘‘motherhood penalty’’ sexist and unfair? It depends on your point of view.
One of the possibilities mentioned in the report was that men and women may have different preferences around the non-financial aspects of work. If so, this wouldn’t exactly be shocking. While it’s becoming heretical to say so, gender differences in preferences and dispositions begin early in life and cut across all cultures. Societal conditioning plays a big role, too, but it’s not all about which toys you played with as a kid.
Perhaps professional women, on average, genuinely prefer better work-life balance or more family time over higher pay. If so, it’d be hard to argue that they’re ‘wrong’, and should be more like the well-paid corporate blokes who have heart attacks at 40 and barely get to see their own children grow up.
That doesn’t mean to say there’s no discrimination in the workplace. Women have been treated as second-class citizens throughout most of history, which makes it hard to believe there’s no longer a glass ceiling in those top pay brackets.
The point is that it doesn’t have to be either–or. Both of these things are probably happening to some degree. Instead of acknowledging this, we seem to have two opposing tribes that insist the gender pay gap is either a myth dreamed up by social justice warriors, or a sinister plot hatched by the patriarchy. Both stances are unhelpful, and both are almost certainly wrong.
Clearly more research is needed. This study was the best one yet, but the authors have already thought of more variables that might help demystify that ‘‘unexplained’’ 80 per cent.
In the meantime, let’s try to avoid the blind ideology and tribalism, and raise the gender pay gap discussion above a pointless ‘he-said, she-said’.
Let’s try to avoid the blind ideology and tribalism, and raise the gender pay gap discussion above a pointless ‘‘hesaid, she-said’’.’
Got a money question? Email Budget Buster at richard.meadows@thedeepdish.org, or hit him up on Twitter at @MeadowsRichard.