The treasurer claimed the gender pay gap has closed. Job done! Except for the facts
Fellow feminists, rejoice! According to no less an authority than the treasurer of Australia, “…the gender pay gap has closed”. Josh Frydenberg said so, on Monday, in Question Time. It’s in Hansard, so it must be true.
Job done! We can all stop with the time-consuming advocacy and agitation, and just hit the shops to start spending the extra $241.50 per week we’re getting in our pay packets now that the government has brought our earnings into line with the blokes. Hurrah!
Except … not so much. It’s not true, as minister for women Marise Payne made clear in the Senate the following day. The gender pay gap in Australia – the difference between average fulltime earnings for men and women – sits at 14% on the latest figures from the Workplace Gender Equality Agency (WGEA).
That’s definitely a significant reduction from its peak in November 2014, when it hit 18.1%. But for more than two decades, the pay gap has hovered between 14% and 19%, and progress on eliminating it is far too slow. Announcing the latest statistics on Unequal Pay Day last month, the WGEA described the gap as “stable”, noting it had hardly shifted at all over the last 12 months, and that, at the current rate of change, closing it completely would take another 50 years.
So how could the treasurer get his facts so wrong on such a fundamental issue? Frydenberg clarified his statement the following day, saying that the pay gap is at “a record low”, a claim he has subsequently boasted about on Twitter.
Isn’t this, then, cause for celebration? Not really. As one of Australia’s foremost experts on gender and work, Professor Rae Cooper from the University of Sydney noted when the latest statistics were released, the reduction in the pay gap over the last five years has coincided with a period of “chronically depressed male wages”.
That is, a large proportion of the decrease in the pay gap can be attributed to falling average full-time incomes for men over the last five years – a result largely due to the collapse of employment in the mining sector, as the end of the boom and a rapid uptake of automation has seen highpaid jobs, disproportionately held by men, disappear.
For the treasurer to claim victory over a reduction in the gender pay gap that has largely resulted from lower incomes and fewer jobs for men sounds entirely the wrong note – and is clearly at odds with the prime minister’s statement on International Women’s Day this year that “…we don’t want to see women rise only on the basis of others doing worse”.
The fact is, the gender pay gap in Australia remains stubbornly high – but in itself, it only tells half the story. The pay gap is calculated by comparing average full-time earnings for men and women across society – apples with apples, so to speak.
But the difference in lifetime earnings for men and women in Australia – which leads to outcomes such as women retiring with 47% less superannuation than men – results from more insidious, and intractable, forces than the difference in full-time earnings.
For a start, women in Australia are far more likely than those in comparable nations to work part-time. ABS data shows that women make up just 37% of full-time employees, but 68.7% of part-time employees.
Among OECD nations, only in Switzerland, the Netherlands, Austria and Germany are a higher proportion of women working part-time. OECD figures also show the employment rate of women in Australia aged between 25 and 54 years is in the lower third of OECD countries.
This is due to the fact that Australia is stuck in the “male breadwinner” model of family income. Even as women have entered the workforce in huge numbers over the last four decades, the “neo-traditional” family structure – in which the man works fulltime and the woman only part-time in paid employment, while the woman undertakes the majority of unpaid care and domestic labour in the home – is the dominant one among Australian heterosexual couple households.
The nature of work in Australia is also highly segregated along gender lines. The latest data from the Workplace Gender Equality Agency (WGEA) demonstrates that “…the majority of Australian employees continue to work in industries dominated by one gender. Only 46.5% of employed Australians work in gender mixed organisations”.
This has a significant impact on the gender pay gap, because professions in which the workforce is dominated by women are significantly underpaid. The WGEA data conclusively shows that people working in industries with a predominantly female workforce have lower salaries than those working in male-dominated industries.
In short, we have a long way to go before we will see the gender pay gap close. If we are to get there, we need to understand and address the real causes of women’s income inequality in Australia.
Facing up to the facts about the gender pay gap is the least we can expect of the man in charge of the national economy.
Emma Dawson is Executive Director of public policy think tank Per Capita