Professional women face biggest pay gap, new data reveals

Tuesday, 29 May 2018

Professional industries might allow less work-life flexbility, penalising mothers, researchers said.

New Zealand's professional women are suffering some of the country's biggest pay gaps.

Statistics NZ data shows that, at an industry level, the financial and insurance services sector has the biggest pay gap between men and women, paying women on average more than 27 per cent less than men.

That was followed by the information, media and telecommunications industry, where the gap was almost 24 per cent, and professional and administrative services, at 23 per cent.

Jessica Berentson-Shaw, co-director of thinktank The Workshop, said in high-earning industries, there was more discretion in what staff were paid and more opportunities for bias to come out.

'Research from last year showed in private industry, women providing the same value to companies as men were still paid less.

'These are industries where women are on a higher income. At lower incomes, there is simply less room to move on pay.

'Minimum wage jobs usually don't move people up salary scales to any great degree within a role so there is less room for bias based on gender.'

Jess Berentson-Shaw: 'At lower incomes, there is simply less room to move on pay.'

She said if those industries were high-pressure, with fewer opportunities to balance work and home life, there could be a penalty for women who tried to work flexibly.

'Perhaps not moving up salary or seniority scales as quickly or at all as parents are not valued in the workplace. They may be viewed as 'less committed' to the role if this is the company culture.'

Miranda Burdon, chief executive of Global Women in New Zealand, said similar data was seen from Britain, where financial services also reported the biggest pay gap.

She said it was often driven by occupational segregation, or men in those industries holding more senior and higher-paid roles.

Geoff Plimmer, director of Victoria University's Centre for Labour, Employment and Work in the School of Management, said situations where staff negotiated their pay seemed to disadvantage women.

They worried about being perceived poorly if they lobbied for higher pay.

He said companies could help by avoiding the pay negotiation process entirely and settling on an amount they would pay for a role.

The biggest pay gaps were seen in industries where bargaining was common and that were less unionised, with a less structured pay system.

Felicity Evans, general manager talent and culture for ANZ in New Zealand, said the gap closed and even favoured women in some instances where salaries were compared like-for-like with roles.

'The solution to addressing this gap is absolutely to focus on the representation of women in higher paying roles across the industry. At ANZ we're focussed on creating pathways to leadership for more women.'

It follows data released this week by Motu Economic and Public Policy Research.

Motu's research showed the wage difference between men and women who did not have children was 5.7 per cent, rising to 12.5 per cent between men and women who were parents.

Hourly rates for women who became parents decreased by 4.4 per cent relative to the wages they could have expected had they not had children.

Equal Employment Opportunities Commissioner Jackie Blue said removing the penalties for being a mother in the workforce required strong and decisive action by businesses and society.

'We need affordable ECE and after-school care. And we need unconscious bias training so that we all, especially employers, recognise and challenge the stereotypes which perpetuate the gender pay gap.'

The commission would also like to see employers with more than 100 employees publish their gender and bonus pay gaps so the causes of the gender pay gap could be examined.

Burdon said that was worth debating. Other countries have introduced such a requirement.

Top five gender pay gaps

Financial and insurance services 27.3 per cent

Information, media and telecommunications 24 per cent

Professional and administrative services 23.1 per cent

Manufacturing 19.8 per cent

Electricity, gas, water and waste services 18.7 per cent

What can we do about it?

As an organisation:

Know your data, analyse it, report on it and regularly review it
Build leadership pipelines which include women
Size the role not the person
Know what the role is worth, don't base it on the person's previous salary
Make standardised or centralised remuneration decisions
Build in checks and balances
Moderate performance outcomes to ensure fairness
Use salary banding/sizing
Include anyone on extended leave in standard pay rises
Ensure that managers are equipped to have courageous conversations about performance
Utilise benchmarking, industry standards
Encourage an inclusive trust-based culture where people understand the processes and decisions made
Enable flexible working to ensure that the widest talent pool possible is available for senior roles
Understand that it will take time and commitment to collect and analyse data in order to close any gender pay gap in your organisation
Budget for the cost in closing any gender gap in your organisation

As an individual:

Ask if men and women are paid the same in your team and in your organisation

As a society/government, are we:

Revaluing skills normally associated with female dominated roles?
Undervaluing or under-paying part-time and flexible work?
Encouraging and enabling men and women to share childcare responsibilities?
Providing flexible and affordable childcare?
Encouraging more girls to study STEM subjects?

* Nominations for the 2018 Women of Influence Awards are open. Nominate an influential woman you know here.