The good news from Glassdoor’s global gender pay gap survey is the gap probably isn’t as big as you might have thought. Technically.
The bad news is, it’s enormous. Males in the US earn more than 24% than women in the US, and the gap is 17% here in Australia.
First, if you’re not aware of what makes Glassdoor different, it’s a jobs website which above all, champions transparency in earnings. That puts it in a unique position of being able to compare wages around the world in real dollar-for-dollar terms. Which they just did, in a big way, analysing a data set of more than 534,000 salary reports in order to get a firm handle on the gender pay debate.
To understand the significance of the findings, you also first need to understand the way Glassdoor broke down the figures into “unadjusted” and “adjusted” results.
“Unadjusted” results are the alarming ones which unequivocally show women earn a whole lot less money than men across the board in the United States, United Kingdom, Australia, Germany and France. So that’s a result taken of all the salaries women posted on Glassdoor against all those posted by men.
Here’s the breakdown:
So you can see Australian women earn 83 cents for every dollar Australian men earn. That lines up neatly enough with official statistics from the ABS which show males on average in Australia earnt $1654.70 per week compared to $1392 for females – an 18.87% bonus.
The numbers game
More than one-third (38%) of that pay gap can explained by differences in how men and women sort into different occupations and industries with varying earning potential. Think jobs which are “traditionally male” versus jobs which are “traditionally female”.
But the alarming part of that statistic is the 62% that can’t be explained. It looks to be unequal because, well, just because we’ve decided women’s labour is worth less than men’s.
But wait. Here’s Dr Andrew Chamberlain, chief economist of Glassdoor:
“While our report reveals a significant gender pay gap, it’s important to understand there are multiple ways to analyze this gap.”
Because just throwing all the wages from all the men and women into the computer and having an alarming figure spat out is misleading. (Although there are still plenty of those to come, further down.)
Men and women, whether we like it or not, can be broadly funneled into different careers due to a range of factors. For starters, women tend to take more part-time jobs and flexible roles due to parenting responsibilities. That also affects how quickly women can rack up experience.
The choices we make with our education vary greatly according to gender and the social expectations associated with our gender. Historically, women tend to fill more roles in lower-paid occupations, such as teaching and social work. US Census figures show women make up only 26 per cent of highly paid chief executives but 71 per cent of low-paid cashiers.
(Of course, that begs the question of whether those roles are low-paid due to their responsibilities, or low-paid because they’re generally filled by women. Here’s a disturbing recent study which shows how wages in particular fields have dropped as more women enter, and raise in other fields after attracting more men.)
Apples with apples
Glassdoor crunched the numbers further to get the “adjusted” figures. These strip away all the factors which differentiate male careers from female careers, leaving only those which can be compared on a like-for-like basis, such as job titles, locations, experience and duties.
A picture emerged from adjusted figures of a much narrower pay gap, down to 5.4% in the US and as low as 3.9% in Australia. Interesting, the adjusted gap was highest in France, which significantly performed better in unadjusted terms.
You can see how the gap narrowed in Australia with each additional control here:
There’s a couple of things to note, even in the more palatable adjusted figures.
First, even 3.9% is too high. Any discrepancy is, because it’s concrete evidence someone is getting paid less purely because she is a woman.
That “unexplained” rate – 62% in the unadjusted figures, stills runs at 39% even in Australia’s adjusted figures. Intentional or not, you can put that down to workplace bias, negotiation gaps between men and women and/or other unobserved worker characteristics.
The trouble with tech
And here’s the most shocking figure. If you want gender pay equality, avoid these 15 career options. Remember, these are adjusted salaries. Apples for apples, what women and men are paid for doing the same job at the same level with the same qualification:
There’s the tech industry again, with solid evidence there’s a lot more work to do on the “brogrammer” front.
For comparison, here’s the bottom 15, showing the only 11 jobs in the survey which saw women paid more than men:
And across all fields, even in adjusted terms, the gap grew as workers got older:
So while the adjusted gap is half the lifetime average when men and women are starting their careers, it blows out to double the average by the time those careers are bringing in the most cash.
Glassdoor says there are several possible explanations for this, but the bulk of research supports the theory that “older women may simply face harsher age discrimination in the labor market”.
So what’s next?
First of all, there’s a few caveats to recognise in all this. A lot of this data is available through government surveys, for starters.
And not everyone uses or is even aware of Glassdoor. Of the 500,000 odd salaries surveyed, only 4,044 were from Australia. And only 8% of Australians using Glassdoor have no tertiary education.
Here’s the breakdown of Glassdoor’s Australian sample:
- There were 4,044 salaries reported from calendar years 2006 through 2015.
- Across 1,370 unique Australia employers and 1,050 job titles.
- The average base pay in the sample was $96,282, ranging from $25,625 to a high of $453,863.48
- Average total compensation was $111,072.
- The sample was 77 per cent male and 23 percent female, and the average age (as of 2015) was 35 years with 6.3 years of relevant work experience.
Glassdoor is largely unable to consider other factors, such as race, children, even innate worker ability, all of which can have a large impact on salary.
And Glassdoor warns that only the base salary figure is 100% reliable. Total compensation is rarely reported thoroughly or even honestly.
So the first thing to understand is the gender pay gap is real, in the US, in Australia, around the world. From the alarming unadjusted gap – 24.1% in the US – to the smallest adjusted gap – 3.9% in Australia, there is, as Glassdoor notes, “a large and statistically significant difference between male and female earnings”.
You cannot simply discount the larger unadjusted gap. It’s could be read as a sign that women are either systematically excluded from certain high-paying occupations, discouraged from studying particular degrees, or encouraged to work in select, low-paying industries.
In the bad old days, it used to be known as “women’s work”, and it clearly still exists, if not in name.
Glassdoor says this is by far the largest contributing factor to the “explained” gender pay gap — far larger than worker characteristics – and as such, needs to be addressed, says Dawn Lyon, vice president of corporate affairs of Glassdoor.
“To help close the gender pay gap, we should focus on creating policies and programs that provide women with more access to career development and training, such as pay negotiation skills, to support them throughout their lives in any job or field they choose to enter,” Lyon says.
“Greater transparency around pay can also help eliminate pay gaps by making it easy to identify disparities and spark conversations with employers to ensure people are paid equally for equal work.”
And if just doing the right thing isn’t enough of an incentive, then at least think about your bottom line.
“Research has shown that companies that embrace salary transparency can also improve employee satisfaction in the long run, which boosts productivity,” Lyon says.