Women’s pay gap widening

By Katherine Dumont

Imagine checking your bank account balance and realising that you hadn't been paid for months.

You ask around the office at work and discover all your male colleagues have been paid on time and in full.

How might you feel if – after putting in all those hours, reaching your targets and hitting all those key performance indicators (KPI’s) – you hadn’t received a cent, while every man at your company had no such trouble?

Alarmed? Confused? Annoyed?

Now consider the dent it would put in your superannuation, your savings and your standard of living if your money disappeared like this for a couple of months every single year.

Fuming yet?

You should be.

Reports show that thousands of women across all sectors in Australia are being short changed.

A NATSEM (National Centre for Social and Economic Modelling) report released in March 2010 shows that simply being a woman accounts for 60 percent of the difference between men’s and women’s earnings.

At this rate, if things don't change, the average 25 year old male will earn $2.4 million over the next forty years, while the average 25 year old female, will earn just $1.5 million.

That means that from the beginning of the tax year on July 1 to September 4, women work for free.

Yet in a country where the Prime Minister and Governor General are female and women hold senior roles across the employment landscape, it is hard to believe that this issue is so prevalent.

But it is.

And it’s worse than ever.

The gender wage gap is worsening year by year and it is something that should alarm us all, according to Marilyn Forsythe, President of Business and Professional Women Australia.

Commenting on newly released Australian Bureau of Statistics results, Ms Forsythe called for employers and employees to take this trend seriously – the statistics confirmed Australia now has an 18 percent a year wage gap – an increase of 0.8 percent over last year.

The gap means that women on average have to work an extra 66 days than men to earn the same amount of money as them.

Australia’s wage gap of 17.2 percent last year prompted the formation of the Equal Pay Alliance by BPW Australia and the ACTU.

This alliance endeavours to bring employers and employees, government and non-government organisations together to start addressing the underlying causes of the gender pay gap.

A recent NATSEM report claims that the main contributing factor to the wage gap “was simply being a woman” and this accounted for 60 percent of the difference between women and men’s earnings.

The report also revealed the economic impact of the gender wage gap where a 17.2 percent gap costs the Australian economy $93 billion each year – equating to 8.5 percent of GDP (Gross Domestic Product).

“Australia simply cannot afford an 18 percent gender wage gap,” said Ms Forsythe.

“Public awareness is critical if we are to achieve what most of thought we had achieved 30 years ago - equal pay.”

But will making the public aware of the issue fix the problem?

“Young people think this (inequity) has been sorted out, that it’s a thing of the past,” remarks Mairi Steele, acting director of Equal Opportunity for Women in the Workplace (EOWA).

“To them it seems stupid – why would men and women be paid differently?”

It’s not until they’ve been in the labour market for a few years, she adds, that many women realise they’re getting the raw end of the deal.

Twenty-seven year-old Chemical Engineer Stephanie Hall agrees.

“As a student, I heard stories about pay inequities, and the fact that senior female engineers earn 30 percent less than men, but I’d always brushed them off.

“You just assume things will be fair. But after just three years in the workforce, I’m beginning to realise they’re not.”

“But with pay being such a secret subject, how are women supposed to know?” asks Jennifer Dalitz, CEO of women’s leadership network Sphinxx.

She says most of her clients stumble across the pay gap by accident; through finding documents inadvertently left on a photocopier or when an oblivious male colleague reveals his salary, for example.

For when women are aware of an inequity, a fear of “rocking the boat” – or self doubt that the gap may be performance related, not discriminatory – means many women are reluctant to confront the issue with their boss, says Ms Steele.

Ms Hall agrees.

“A few years ago, in my first job, I was given a pay increase that I knew was $5000 less than my male colleagues,” said the chemical engineer.

“At the time I was upset about it, but I didn’t know what to do.

“ I wasn’t supposed to know what my colleagues earned in the first place, so I didn’t feel I could reveal I knew the guys had earned more.

“Even if I did argue I’d been paid less than them, my boss could have simply said my work wasn’t as good as theirs  - in which case  I wouldn’t have received any extra money but I would have been branded ‘difficult’.

“As a result,  I just left the company,” said Ms Hall.

“I know that if I ever raised it as an issue – or argued I wasn’t getting paid fairly – I'd be seen as a ‘femo’, and it’s crucial to my career progression that I don’t rock the boat,” she said.

But before you start playing the blame game, consider this.

Research indicates that there are many factors that influence the pay gap.

Some blame the introduction of WorkChoices – and its focus on individual contracts.

But according to the Department of Commerce, a range of social, historical and labour market factors have contributed to the gender pay gap.

The key factors contributing to women earning less than men include the lack of permanent part time jobs and flexible working arrangements,  the fact that women are over-represented in casual or non-career part time jobs and that men and women still tend to work in different areas of the workforce and be clustered into separate occupations and industries, making them ‘underevalued.

But according to Ms Forsythe, the other point of note from the report (NATSEM) is the urgent need for better negotiation skills for female employees.

However, according to Ms Hall, bringing the issue to the bosses attention is far from easy.

“Engineering is a very male dominated industry.

“There's a boy’s club at my office; all the guys, from junior engineers to senior managers, go to the pub or play golf together,” she said.

“I feel like an outsider, and even when I think it is an appropriate time to broach the subject, I am dismissed as complaining or whinging and even reminded that I am lucky to have a job.”

Last March, the Australian Services Union (ASU) filed a test case with national workplace relations tribunal Fair Work Australia to probe another potential factor: that ‘feminised’ industries dominated by women – such as caring professions – tend to be under valuated because they’re seen as “women’s work”.

Still, some believe the biggest wedge in the pay gap is also the ugliest: according to the NATSEM ‘the impact of a sustained gender wage gap on the Australian economy, 60 per cent of any inequity can be blamed on simply being a woman, and sexual discrimination is a huge part of that.’

“I understand that I get treated differently just because I am a woman,” said Ms Hall.

“But I work just as hard as my male colleagues and I have simply had enough.

“Last year I joined Women in Mining, as I believe women need to work together to reduce the pay gap.

“I have no idea whether I make less than my male colleagues now, but I get furious when I consider how much I'll lose in savings and super over the years.”

So will we still be going backwards in another five years?

Last year’s government inquiry into the issue, together with the ASU case, signalled a renewed push to start closing the gap.

But, according to Labor MP and inquiry chairperson Sharryn Jackson, there is plenty of work still to be done.

“Leadership is required by Government,” she concedes before calling for more pay equity auditing, including across all government agencies; more salary transparency; as well as more support for family-friendly working practices.

“Paid parental leave is a very good start.”

But above all, all women - whether at entry level or executive stage – need to stand up for their rights and demand fair pay within their companies.

“I urge Australian women to get informed about the issue and get organised around the solutions,” she said.

“If we work together, we should hopefully see a steep decline in the wage gap.

“It is 2010, Australian women should not be faced with such a backward issue. So get out there, use your voice and close this gap for once and all,” she urges.