The significance of gender pay inequity in the global context

The gender pay inequity has become one of the most significant issues in the global arena. This could be reviewed at both the institutional and individual levels. This denotes the prejudicial beliefs and discrimination of individuals along with the policies restricting the opportunities of minorities. For instance, out of 100 employed people, 47 are women, where in 1962; the number was 34 in France (Economic Policy Institute 2017). Despite such increase, gender is an important decisive of professional positions in workplaces. Moreover, a significant number of reports and review have revealed that women working both part-time and full-time earn lower in contrast to men.

Thus, the current report would focus on discussing the need for gender pay inequity that persists in the global nations. The latter section would deal with identifying the reasons that lead to gender pay inequity in countries, especially Australia. Finally, the report sheds light on recommending some possible measures that would help in minimising such inequity in the workplaces and professions.

Income gender inequity, in the context of economic inequality, is the differences between the earnings of men and women. It could be computed in the form of a ratio of female to male earnings expressed as a percentage. The women population has been depicting its talents, which depends on the world to account and utilise this talent pool for ascertaining the competitiveness of the economies.

The gender inequity in income is a problem, which has been surfacing globally and due to this, the nations would have been influenced. Hence, it has been chosen, since it is felt that corrective measures might not have been developed for addressing the issue on global scale. Besides, reports have depicted that the gender pay inequity has not been resolved fully, since the workplaces of many nations are encountered still with the issue of gender inequality. However, the generation of global awareness amongst the global audience along with enforcement of effective measures and practices could help in minimising gender inequity. 

An instance of common stereotypes depicting men being more dominant and women viewed as the weaker gender are inherent. This takes place when both genders working in the same sectors are provided with varied remuneration, in which men earn higher in contrast to women (Blau and Kahn 2017). Australia is not spared in this aspect. Statistics have revealed that there is closure of income gender inequity. However, the relevancy is inherent only in the occupations of sales, professionals and cleaners.

Reasons for gender pay inequity in Australia

It has been observed that the employers have empowered men with prospective occupation, which result in high flying careers. However, the scenario is not identical for female population. There is greater likelihood that the employers entrust females with occupation positions, which are deemed as dead-end or the mobility is little for progress. The perception is that the women would quit their jobs or labour force during marriage or pregnancy.

The doctrine of equality of opportunity is one of the primary tenets related to human development. However, the variations in earnings between genders depict the way discrimination leading to inequality along with placing one at an advantageous position or vice-versa. As per the International Labour Organisation (ILO), the advancement in minimising the income gender inequity is slow in Central Asia and Europe. Although it has been narrowed down in some nations; however, on a global nation, ILO has not found any strong evidence (Livsey, 2017). The improvisation of stringent policies and practices need to be made in the light of significance in each nation and the effective way of achieving this is with the help of government intervention.

The women talent involving the capacity for skills are not rewarded identically. In addition, the work division has been gendered leaving women encountering a disparity in the labour market coupled with limited positions and rights in organisations. The gender inequity in society has influence on the economic growth of the nation, which constrains its progress. In the long-run, the society would encounter higher negative consequences from the economic perspective arising from such discrimination like gender inequity at work. This is because gender inequity minimises growth potential. With the decline in gender inequity, benefits could be sought on the part of men, women, children, elders, poor and rich. As a result, it would help in the advancement of the economies from the global perspective.

The earnings of women have been evaluated in some nations and there is substantial rise in earnings. In addition, the payment is sometimes higher in comparison to men due to their qualifications. This describes that the income is dependent only on the merits of the individuals. However, the practice is not made globally, with Australia, a developed nation, having a score of 0.666 (0.00 = inequity/ 1.00 = equity). Moreover, for wage equity for identical work, Australia is ranked 9^th (ABC News 2017). However, Australia is still encountering this issue due to which the income gender inequity plays an important role in ascertaining wage.

Impacts of gendered work division and discrimination

 In the Australian perspective, women still earn less in contrast to men in almost all occupations. The inequity is even broader at the time of comparison of mean incomes, which denotes that men still earn greater wages in contrast to their female counterparts. The structural constraints in Australian economy back this; thus, restricting women from making greater income. The contrast of the monthly gross salary in the managerial positions depicts symbols of glass ceiling. The mean gross earning is $9,065 for a man in contrast to $7,272 for a woman, while the median gross wage is $6,450 for a man compared to $5,673 for a woman (ABC News 2017). 

The predetermined notion that females have shorter life-spans of employment and job experiences due to conventional domestic duties and pregnancy like housekeeping and child rearing is the contributing factors leading to stereotype against women at work. This factor contributes for a significant constituent of the income gender equity. Because of the family-related priorities and commitments, the average number of women in the labour market has lower experience compared to average number of men, which leads to variation in pat between the two genders.

Along with this, an identical position, in which both genders are employed, are taken into account of National Service. Men receiving training in this domain are given higher preference, which has immense role in the salary differentials. Since this domain provides men with necessary skills like leadership and decision-making, it is much needed in the job market. Thus, providing them with a greater salary in the private and public organisations is justified fully. As National Service could not be avoided, women might be left with lesser power in both private and public sectors when it comes to representation.

There are many reasons that the gender pay inequity still persists in most of the global nations irrespective of their development. This section would particularly focus on finding out the reasons behind such gap in the context of Australia. These reasons are briefly demonstrated as follows:

Wage secrecy:

A major problem is that there is secrecy in wage-associated data largely in Australia, which might lead to underpayment of women and minorities without even knowing it. The employers develop new policies frequently, which restrict the workers from discussing their earnings, despite the fact that these policies are sometimes unjustified and unlawful as well. Yet there is intimidation to staffs through corporate cultures by making it taboo in discussing salaries, even among the trusted co-staffs. Moreover, as women sometimes do not have any idea about the true payment of the job, they could undervalue them at the time of negotiating a new salary. This might tag them as underachievers (Card, Cardoso and Kline 2015). Hence, lack of knowledge about discrepancies in wages could affect them.

Slow advancement in minimizing the income gender inequity

Suing is not a feasible remedy:

If an employer is brought to court in accordance with the Equal Pay Act, it could be an effective alternative for most women, which is out of reach for majority of them. Due to lesser number of awards in cases of Equal Pay Act, the attorneys could not earn greater incentives from accepting cases. Moreover, havoc could be developed on the funds and personal lives of women for filing a case of equal pay. However, the employers often come back strongly in the form of legal fight and this could ruin the credibility of the employee, as the former seek to defend the organisation. 

The retribution against women filing claims is inherent in Australia. Such retaliation could be in the form of hostility, transfer to infeasible locations, negative letters in files of the personnel and other means for intimidating them (Cha and Weeden 2014). Such type of treatment could continue for years at the time the case passes its way through the legal process. Even if the case could be won on the part of woman, she might be adjudged as a troublemaker and she would have to struggle hard to find next job within the industry.   

Less pay and more leave:

Women are generally responsible for raising small children. This implies that they could not work for few years, which minimises their earnings at the time of return. However, not every woman is taking time off, since various families depend on two pay cheques and they could not afford for one parent in staying home. According to a survey of 500 services and 1,000 industrial organisations, only one-third had taken absent leave and most have taken lesser than half a year leave (Wgea.gov.au 2017). 

Equal value with lower pay:

Sometimes the jobs that women dominate in an organisation are not valued identically like the jobs of men. In other words, the more women and people of colour plug an occupation, the less it pays. With the help of a point factor job evaluation system, the state of Tasmania identified that women are paid 20% less on average in contrast to men, despite equal scores in the job evaluation system. The adjustments pertaining to pay equity have been phased in above four years at a cost of 3.7% of the total payroll.

Inability of market forces to eradicate discrimination:

It has been said that the market forces help in eradicating discrimination; however, they are yet to play their roles despite the enforcements of Equal Pay Act and Civil Rights Act. If the market forces had been relied in implementing transparency, the need for Civil Rights Act and the Disabilities Act is unnecessary. The market forces fail to overcome unfairness in workplaces. The dogmatic employers would make additional payment for working with white individuals, which would have negative impact on the economy of Australia.

The need for governmental intervention

Presence of intangible discrimination:

Discrimination could not be felt like that of a smoking gun, in which the senior executives of an organisation would make racial slurs. Instead, the form of discrimination is subtle and pervasive. For instance, in a case of sex discrimination, the female staffs might complain about the accounts of retiring staffs, lucrative networking opportunities and walk-ins have been steered towards men in the organisation. Another inherent problem is that women are not provided with assignment or positions on significant committees that would shape their respective careers. Thus, when women face trouble to advance in an organisation, they could not gather the experience required for developing leadership skills.

Old stereotypes die hard:

In the current era, it is still thought that women do not match with men, since men need to support their families. In addition, stereotypes are there for women about the kind of work suitable for them that limit their progress in some sectors, in which the men dominate at present. 

Not all jobs are open to women:

More than half of all women in Australia are concentrated in the wide categories of clerical, sales and service jobs. Thus, women could find it hard to enter into the male-dominated jobs. For instance, an organisation in Australia had agreed to pay $300,000 in back pay for refusing to recruit women as woodworkers. In addition, another plumbing hardware manufacturer in Australia had agreed to pay $900,000 to 2,000 women not recruited due to their gender (Korpi, Ferrarini and Englund 2013). At the time women enter into male-dominated jobs, sometimes they encounter hostile work environments and they would find little support for their presence.

Failure to address unfair pay practices:

The employers are not able to address this particular issue due to their concern regarding future liability. Partially, it might be discrimination, as many employers do not want to believe that they are involved in discrimination or that their discrimination level is tolerable. However, as the socialisation in Australia is unfree from race bias or gender, it could result in undervaluing minorities and women on the job. Thus, it is crucial for the employers to place aside their fear. The experts associated with private sector compensation could enable in developing a fair pay system phased in quietly over time. A written pay policy would depict the workers that the development of the system is on objective criteria (Lips 2013).

The benefits of reducing gender inequity

Weak prevailing legislations:

The existing laws restricting the discrimination of wages are required to be strengthened. The significant laws include the Equal Pay Act and the Civil Rights Act; however, they are difficult to enforce. In addition, it is extremely difficult to win the legal cases. Since the enforcement of laws is driven by complaints and most of the information required for proving a complaint is held on the part of the employers, such legislations do not have the ability to rid Australia of the discriminatory pay practices. Along with this, the Equal Pay Act fails to allow women in filing class-action lawsuits and the compensation for damages is very insubstantial. 

• Gender discrimination gap has increase d from 35% in 2009 to 38% in 2016, as systemic discrimination stays a persistent characteristic of the workforce, while the proportion of the income gap to be attributed to variations in tenure, skills and education between men and women falls each year.
• The gap proportion attributable to part-time employment has fallen from 14% in 2009 to 4% in 2016. Women are over-represented still when it comes to part-time employment, which constitutes of 71.60% of the overall workforce.
• One of the most important gap contributors is the impact of conventional roles and sectors for men and women that constitutes of nearly 30% of the gap.
• The proportion of gap, which is attributable to years out of the workforce, has risen from 9% to 21% (Tharenou 2013). This depicts the overall business criticality continuing to track and address the structural impediments prohibiting women from returning to the workforce.

 

Figure 1: Findings of income gender inequity in Australia

(Source: Paustian-Underdahl, Walker and Woehr 2014)

The following recommendations would be extremely beneficial for the business organisations in Australia to mature their position on addressing the income gender inequity:

Knowing the numbers:

It is extremely vital to gain an insight of the pay gap quantum in the context of a specific business and sector along with accurate evaluation of the environmental, business and cultural processes and behaviours that might be contributing.

Leveraging the lifecycle:

There are four major stages involved in the lifecycle of a staff, which constitute of appointing, performance review, setting of remuneration and reporting. Such stages provide an opportunity of considering the ways the existing business processes could be amended in driving great equality in income outcomes.

Caring conundrum:

A major area of focus for the participation of the workforce is the primary to mid 30s period that often intersects with child bearing and rearing years. This is a crucial time, when many women decide to leave full-time work by shifting to part-time roles. This requires the businesses to focus on the techniques that would help in retaining the staffs taking time out along with assuring their sustainable return.

Training the team:

The presence of on-the-job training initiatives gives crucial access to development of skills and the development of professional networks that could steer the greater participation and career progression of women.

Dealing with the dollars:

While providing remedy to the continuing processes is crucial to accomplish income equity, measures to abolish gender-related remuneration bias encountered on the part of women in the past need to be taken.

Changing the culture:

The appropriate organisational culture is highly necessary for steering out the behaviours resulting in the income inequity. It is necessary to recognise that intervention would be needed for addressing the income inequity issue timely at both macro-economic level and organisational level.

The current state of gender pay inequity in Australia

Conclusion:

From the above discussion, it has been evaluated that the gender inequity in income is a problem, which has been surfacing globally and due to this, the nations would have been influenced. Hence, it has been chosen, since it is felt that corrective measures might not have been developed for addressing the issue on global scale. Besides, reports have depicted that the gender pay inequity has not been resolved fully, since the workplaces of many nations are encountered still with the issue of gender inequality. However, the generation of global awareness amongst the global audience along with enforcement of effective measures and practices could help in minimising gender inequity.

More than half of all women in Australia are concentrated in the wide categories of clerical, sales and service jobs. Thus, women could find it hard to enter into the male-dominated jobs. In the current era, it is still thought that women do not match with men, since men need to support their families. In addition, stereotypes are there for women about the kind of work suitable for them that limit their progress in some sectors, in which the men dominate at present. While providing remedy to the continuing processes is crucial to accomplish income equity, measures to abolish gender-related remuneration bias encountered on the part of women in the past need to be taken. Finally, the presence of on-the-job training initiatives gives crucial access to development of skills and the development of professional networks that could steer the greater participation and career progression of women 

References:

ABC News. (2017). Australian women could be paid less than men for another 50 years. [online] Available at: https://www.abc.net.au/news/2017-07-26/gender-pay-gap-women-could-be-paid-less-for-another-50-years/8745690 [Accessed 31 Dec. 2017].

ABC News. (2017). The gender pay gap has narrowed … to $26,527 per year. [online] Available at: https://www.abc.net.au/news/2017-11-17/women-paid-$26,527-less-than-men-per-year-but-pay-gap-narrowing/9159468 [Accessed 31 Dec. 2017]

Blau, F.D. and Kahn, L.M., 2017. The gender wage gap: Extent, trends, and explanations. Journal of Economic Literature, 55(3), pp.789-865.

Card, D., Cardoso, A.R. and Kline, P., 2015. Bargaining, sorting, and the gender wage gap: Quantifying the impact of firms on the relative pay of women. The Quarterly Journal of Economics, 131(2), pp.633-686.

Cha, Y. and Weeden, K.A., 2014. Overwork and the slow convergence in the gender gap in wages. American Sociological Review, 79(3), pp.457-484.

Economic Policy Institute. (2017). “Women’s work” and the gender pay gap: How discrimination, societal norms, and other forces affect women’s occupational choices—and their pay. [online] Available at: https://www.epi.org/publication/womens-work-and-the-gender-pay-gap-how-discrimination-societal-norms-and-other-forces-affect-womens-occupational-choices-and-their-pay/ [Accessed 31 Dec. 2017].

Korpi, W., Ferrarini, T. and Englund, S., 2013. Women’s opportunities under different family policy constellations: Gender, class, and inequality tradeoffs in western countries re-examined. Social Politics: International Studies in Gender, State & Society, 20(1), pp.1-40.

Lips, H.M., 2013. The gender pay gap: Challenging the rationalizations. Perceived equity, discrimination, and the limits of human capital models. Sex Roles, 68(3-4), pp.169-185.

Livsey, A. (2017). Australia’s gender pay gap: why do women still earn less than men?. [online] the Guardian. Available at: https://www.theguardian.com/australia-news/datablog/2017/oct/18/australia-gender-pay-gap-why-do-women-still-earn-less-than-men [Accessed 31 Dec. 2017].

Paustian-Underdahl, S.C., Walker, L.S. and Woehr, D.J., 2014. Gender and perceptions of leadership effectiveness: A meta-analysis of contextual moderators. Journal of applied psychology, 99(6), p.1129.

Tharenou, P., 2013. The work of feminists is not yet done: The gender pay gap—a stubborn anachronism. Sex roles, 68(3-4), pp.198-206.

Wgea.gov.au. (2017). What is the gender pay gap?. [online] Available at: https://www.wgea.gov.au/addressing-pay-equity/what-gender-pay-gap [Accessed 31 Dec. 2017]