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Will the Gender Pay Gap Ever Close?

Will the gender pay gap ever close?

This year marks the 125th anniversary of women's suffrage in New Zealand. 125 years ago we led the world by granting women the right to vote. And, in some respects, we’re still leading the way. Jacinda Ardern is our third female prime minister, we currently rank fourth in the world for the percentage of women in senior or managerial roles, and our gender pay gap is closing each year.

But is it enough?

125 years after women won the right to vote should there still be a gender pay gap and what does the term actually mean?

Put simply, the gender pay gap is a high-level indicator of the difference between women and men’s earnings. It’s the difference between women’s and men’s average weekly full-time base salary earnings, expressed as a percentage of men’s earnings.

According to figures from Statistics NZ, New Zealand's gender pay gap is closing. The gender pay gap is currently sitting at 9.2 per cent. But the reality is, it’s taken 20 years to drop from 16 per cent in 1998 to just over 9 per cent in 2018.

Will it take another 20 years to close the gap to zero? Or is zero even possible? It’s a complex issue with no magic bullet.

The gender pay gap is influenced by a number of factors, including:

• women and men working in different industries and different jobs, with women more likely to be clustered in a range of occupations at the bottom or middle of an organisation
• women’s disproportionate share of unpaid caring and domestic work
• women’s greater time out of the workforce impacting career progression and opportunities
• discrimination and bias in hiring and pay decisions

The gender pay gap is smaller for people aged under 30 and largest for workers aged between 50 and 54, where the difference is 18.4 per cent.

It seems women taking time off work in their 30s, often to start a family, contributes significantly to the gender pay gap.

Also, many female workers in New Zealand work in occupations that are more than 80% female and these female-dominated occupations tend to be lower paid. Only recently Kristine Bartlett changed the lives of thousands of New Zealand women and low-paid workers by securing equal pay legislation for caregivers in the aged-care sector. This high profile case brought the issue to the forefront for many New Zealanders.

But as well as being over-represented in low-paying jobs, women are under-represented in higher-level higher paying jobs.

The benefits of pay and employment equity are multiple. Employees who are valued appropriately are likely to be more productive, loyal, supportive, and dedicated. Diversity in the workplace brings different talents, skills, perspectives and experiences, that benefit work performance and is shown to lead to increased innovation. Employment equality is also good for an organisation’s employer brand because employees value fair pay and opportunities.

So what needs to change?

More women would need to be employed in largely male-dominated industries such as science and engineering fields.

There needs to be improved workplace flexibility to accommodate caring and other responsibilities, especially in senior roles.

Employers need to step up and implement policies and practices to ensure a focus on recruiting, training and retaining women — and paying them as much as their male counterparts.

Because, quite frankly, closing the gender pay gap is important for women, business the community and the country.

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