The Gender Wage Gap is the distinction between the average weekly full-time equivalent wages of women and men, expressed as a percentage of men’s income (Miller, 2017). This disparity is a product of several variables that determine the place and role of women in society, namely social, family and stereotypes. These social stereotypes determine which job women and men can perform and which can not perform. Industrial segregation is characterized by the same stereotypes as men and women who work in various industries and occupational segregation, that is, those who work in different occupations. According to IWPR’s report women are almost half of the workforce they are the sole or co-breadwinner in half of American families with children and they receive more graduate degrees than men, yet, on average, women continue to earn considerably less than men (Fact Sheet,, 2017). Does this simply mean women choose low-paying jobs compared to men? Do women work only part-time hence the low income? Does sex, race and gender discrimination influence how much women are paid at the work place? This paper seeks to answer the aforesaid questions and identify the gender bias that exists at work place that results in women earning less than men.
Keywords: Gender pay gap, occupational segregation, discrimination.
The History of Gender Wage Bill
According to the Office for National Statistics (ONS) which collects data on earnings in the UK, the average pay of women working full-time was only 90.6% of men’s pay in 2016. This means that compared to men, women stopped earning on the 10th November 2016 – they were effectively working for no money after this date, which is referred to as Equal Pay Day (Anitha, 2017). The reality of the matter is when women are earning the plight of their families is at stake especially for single mothers who are sole providers for their families.
The revolution of equal pay in the UK started in the 1920s and 30s, state policy in the UK reflected the common practice of lower wages for women, both in pay rates and in the lower rates of unemployment benefit, to which they were entitled (Anitha, 2017). It is in this era that women activists started campaigning for equal pay among men and women and shamed the injustices experienced by women at work places. Women groups, trade unions and women’s suffrage had to mobilize working women to fight for their rights and demand equal employment benefits compared to their male counterparts. The issue of equal pay was again raised again and again and it became an increasingly articulated demand by trade unions and women’s organizations from 1950s onwards (Anitha, 2017).
The good news is that the gender wage gap is shrinking, if slowly, in comparison to 1970, white women earned 70 cents on the dollar but, now, women are more educated and more experienced, and society in general is more aware of the gap than ever before (Anitha, 2017). Thus global companies like Companies like Salesforce and Pintrest have consequently made global headlines promising to close the Wage gap in their own capacity. The discrepancy in the Wage Gap came as a result of societal stereotypes who assumed that generally men are ambitious than women, that women’s place is care giving, that is having babies and raising a family, some argued that women willingly opt for low-paying jobs compared to men all these allegations are fallacies that have been proved wrong over the course of time.
The provisions regarding equal pay are now in the Equality Act 2010 and according to this Act, men and women are entitled to equal pay and conditions if they are doing the same job; like work (work that is the same or broadly similar); work rated as equivalent (different work, but which is rated under a job evaluation scheme as equivalent); or work of equal value (that is, work that requires similar effort, skill and decision-making (Anitha, 2017).
Gender Wage Gap Is a Societal Problem
Wage equality isn’t and should not only be a woman’s issue but a concern the society should care about. It is not the choice of women to be women better still it is not their choice to be paid way less than men but that is exactly what happens. Are women being punished simply for being women? Is the society okay with that? In a response to the gender gap, the UK Government published a booklet called “negotiating your salary.” It claims to help women “understand the secrets to success in negotiation” and the Minister responsible at the time said:“I want women to feel able to hold employers to account if they feel they are not being paid the same as their male colleagues and I hope this new booklet will be an important tool in helping them do that” (McCormack, 2015). Equality aside the pay gap isn’t economically fit as research as shown that companies perform better when more women hold leadership and managerial positions. For example, CNBC quotes a 2011 survey by Catalyst showing that company boards made up of 19 to 44 percent women achieved 26 percent more return on invested capital than those firms with no women board members (McCormack, 2015). Sadly the pay gap is seen even in the family setting, whereby the boy child is seen to be favored in terms of the allowance allocated to him by the parents compared to the girl child.
According to a research conducted in Australia by Gai McGrath, Westpac’s general manager of retail banking confirmed that boys earned 6.6 percent more pocket money than girls, he confirmed that paying girls less pocket money than boys “sends a powerful message that girl’s and women’s work isn’t as valuable as that of boy’s.” (McCormack, 2015).
Radical Actions To Close Pay Gap In Future
Believe or not according to a report by the World Economic Forum best known for its high-profile gathering each year in Davos, Switzerland, found that economic disparity between women and men around the world was rising even though the gap was closing on other measures, such as education (Treanor, 2016). The same report predicted that it could take 118 years for economic parity to be achieved as the economic gap is caused by a number of factors, including women being paid almost half of what men receive, working on average 50 minutes a day longer and having a much slimmer chance of reaching senior roles (Treanor, 2016).
There are a number of benefits derived from closing the pay gap, namely;
Equal job opportunities and social justice – By closing the pay gap companies can create a cohesive organization where all parties are treated as equals. Valuing all employees, that is, male and females equally can greatly motivate them to perform better and enhance financial independence. When women are empowered, their families and society at large is empowered.
Greater profitability to the company and the economy at large – Women should be given an equal opportunity as men to contribute to the growth of the economy and be compensated equally as men. Women are unexploited potential in the labor force, and companies should take good advantage of that and utilize women skills, however they should ensure they handsomely compensate them for services rendered.
Beneficial to both employer and employee – It is pivotal for any serious organization to ensure they adhere to equal pay on all its employees for profit maximization and productivity.
According to (Syed & Kramar, 2013), in the recent decades, significant demographic changes such as, increased women participation have placed greater pressure on both governments and the private sector to initiate and implement creative solutions to train, integrate and retain a rapidly changing and diverse working population.
The traditional approach of identifying pay gap is based upon identification of gender bias in a particular industry however wider analysis has shown how the problem is industry based, rather than job based (Cox, 2012). All jobs in feminized industries tend to be lower paid than similar ones in male-dominated industries; unfortunately, the reverse doesn’t happen in masculinized industries, gender gaps are highest in industries such as finance and mining (Cox, 2012).
According to a report prepared by (Cox, 2012), shows that fields dominated by women—such as nursing, social work, and teaching are typically less compensated than fields that are predominantly male, like finance. This has less to do with the skills involved and more to do with gendered preconceptions of what kind of work is valuable (Cox, 2012).
Ways To Eliminate Pay Gap
Through Pay Transparency, especially top management. Transparency answers any concerns arising relating to pay gap at work places despite of gender.
Case Example: ‘Transparency is a core tenet at data analytics startup SumAll, it’s what’s helped the four-year old company grow at a rapid clip, according to its cofounder and CEO Dane Atkinson. He says SumAll has realized 1000% growth each year of operation and has amassed 350,000 clients’ (Dishman, 2017).
Equal pay to all employees, who are in the same job bracket. Companies should ensure they accord women employees with the respect they do their male counter parts. Women need to have a sense of belonging in the company. Male colleagues should also ensure they treat their female colleagues as team mates and work together harmoniously for the greater good of the firm.
Pay Gap Theories
There are various theories used to thoroughly explain the origin of pay gap and discrimination at work place, namely:
The human capital Model- Gender differences in qualifications have been analyzed within the human capital model, which basic idea is that every person has some form of human capital (Grybaite, 2006). This simply means the skills and abilities acquired through trainings, education and experience. This further determines the earnings the employees get. Gender roles also affect the time women have for paying work , because traditionally the place of women is at home, hence they are expected to take care of household chores before they go to work. This further limits the time and energy they have to work for pay. According to human capital critics, women and men cannot be studied as autonomous individuals and the different conditions they face in their working life must be put in material and social context (Grybaite, 2006).
Labor Market Discrimination- the portion of the gap that is not due to gender differences in qualifications is generally presumed to due to labor market discrimination (Grybaite, 2006). It’s good to note that skilled workers are paid better than unskilled workers. However economic discrimination arises when identical workers receive different pay doing the same job, or are given different chances of employment or promotion (Grybaite, 2006). This simply means women are paid lesser than men for the same work performed. The standard economic analysis of discrimination is based on Gary Becker work, who assumed that some individuals have a taste for discrimination (Grybaite, 2006). Becker analysis of discrimination is inlayed within the convectional economic analysis of utility-maximizing firms that often straiten their behavior (Grybaite, 2006).
Crowding Model- developed by Barbara Bergmann is useful to understand sex inequality in labor market and consequently pay gap, but this theory does not answer the important question as to why female jobs are crowded (Grybaite, 2006). For firms to be competitive they ought to treat all their employees equally.
There has been narrowing of the gap in gender pay from 1980, especially amongst younger employees, nevertheless, it still continues. For instance, an analysis by Pew Research Center shows that women grossed 83 percent if what men were paid for both part-time and full-time US employees. On the basis of this approximation, an additional 44 work days would be required for women to gross what men got in 2015. Comparatively, women grossed 80 percent of what men got in 2015 while examining year-round, full-time employees according to US Census Bureau. Nonetheless, in 2015, the wage gap is less for individuals aged between 25-34. Females in this group grossed 90 cents for each dollar earned by a man in within a similar age group (Blau et al., 2015).
The approximated 17 percent gap in gender pay for every worker in 2015 reduced from 1980’s 36 cents. The gap for young females has narrowed over time even more. Thus, in the 80s women grossed 67 percent of what men earned, in comparison to 2015’s 90 percent. But why is there persistence of gap in gender pay? A 2013 PEW research found out that women are most likely to claim that they took leave from their professions to care for their families. Such kind of interruptions and breaks usually have an effect on earnings in the long-run. Roughly, 4 in 10 mothers claimed that at some time in their career, they took considerable time off (39 percent) or decreased their work hours (forty two cent) to care for family members or child. Roughly about twenty seven claimed they had left work altogether for taking care of such domestic duties. Less men claimed the same (Blau et al., 2015).
Although females have raised their positions in well-remunerating careers traditionally men’s domain, for example managerial and professional jobs, women in entirety continue being overrepresented in poorly paying careers, and this might also lead to gender disparities in pay. Some aspects of the pay disparity might also be because of gender discrimination. Women, in a 2013 survey were about two times as likely as men to claim they had faced gender discrimination at work. Moreover, both women and men experience inequalities at their place of work-with 77 percent of women and 63 percent of men claiming that there is need to review the gender pay gap .
Even as labor activists are advocating for equal wage, women should go a step further and ensure they negotiate for their salaries, increment and even promotions. This is because there is an inverse relationship between advocating for themselves and likability (Grybaite, 2006). Women should also get into male-dominated fields and excel in them in order to be treated with the seriousness they deserve. Women should be empowered economically in order for them to be dependent on themselves and not men. Other changes that assist in closing the wage gap include companies being compelled to carry out regular salary audits so that they can proactively not only monitor but also tackle gender-based variations, women can be trained and equipped with superior negotiating skills for equal pay, advocating for themselves as far as benefits, promotions and salary is concerned. Finally policy makers must come up with new pay fairness acts or enhance existing ones so as to harmonise the gender pay gap.
In future research must be undertaken on the best changes that must be undertaken so as provide both women and men equality in their places of work and make sure that there is zero gender discrimination or disparity as far as work and pay are concerned.
Anitha, S., (2017). The history of the struggle for equal pay. Striking Women. New York, Cengage Learning.
Blau, F. D., Gielen, A. C., & Zimmermann, K. F. (2015). Gender, inequality, and wages. Oxford, UK: Oxford University Press.
Cox, E., (2012). The reality of the gender wage gap. The Coversation.Oxford, UK: Oxford University Press.
Dishman, L., (2017). A Definitive Strategy To Eliminate the Gender Pay Gap. Fast Company. CengageBooks. New Jersey
Institute for Women’s Research., (2017). The Gender Wage Gap by Occupation 2016; and by Race and Ethnicity . Institute for Women’s Policy Research
McCormack, C., (2015). Why The Gender Pay Gap Is A Societal Problem, Not A Women’s Issue. Elite Daily. New York.
Miller, C., (2017). The Gender Pay Gap Is Largely Because of Motherhood. The Upshot.CengageLearning.New York
Syed, J., & Kramar, R. (2017). Human Resource Management: A Global and Critical. New York.
Treanor, J., (2016). Global economic disparity between men and women. The guardian. UK.