Happy International Women’s Day! Unfortunately you still earn $1m less than men

International Women’s Day is a time to celebrate the achievements of women across the world but it is also a time to acknowledge the discrimination that women continue to face in the workplace and beyond. It is a level of discrimination that results in women in Australia being paid at least $1m less than a man throughout their working life.

In a new report, my colleague at the Australia Institute’s Centre for Future Work, Eliza Littleton, and I have found some pretty jaw-dropping instances of how large and widespread the pay gap remains, detailed in a new report.

The gender pay gap is the percentage difference between men’s and women’s pay, but the problem is how to count it. Hourly or weekly? Full-time ordinary earnings, full-time total earnings, average earnings or median earnings?

For example, the hourly pay gap (what people are paid per hour) for women aged 25-34 is 3.9%, but the weekly pay gap (what they are paid in a week) is 18.8%:

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But whatever way you measure it the gap remains.

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This adds up, conservatively, to women being paid about $1m less than the median male earner during their working lives (in today’s money). I say conservatively because this data is using weekly earnings extrapolated into annual incomes, which means we are likely overstating how much women are paid.

This estimate also assumes a woman works throughout her entire working life without taking time off, which we also know is not typical.

So, when we say women are paid $1m less, that really is “at least”.

But gender pay gaps are not just about income. The tyranny of the pay gap carries on into retirement, because it affects how much you have in your superannuation.

Using the median income figures above and Asic’s superannuation calculator, we can estimate that a woman on the female median income will retire with about $137,000 less in her super balance than a man who has been on the male median income at all stages of his working life.

One problem is that work traditionally done by women is valued less than work traditionally done by men. This is the problem of “gender segregation”, which occurs in occupations and industries where the vast majority of workers are either men or women.

Our report uses tax data from 2019-20 to analyse the 1,032 occupations with more than 50 people working in them (excluding trainees and apprentices). This enables a more granular examination of gender pay gaps than with ABS data.

We found there were 80 occupations with an average income above $100,000 and where men made up more than 80% of all workers.

How many occupations were there where women made up more than 80% and that also had an average salary above $100,000? Zero.

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But it’s not as simple as getting women to shift into male-dominated occupations. There is not just a segregation of women across occupations, but within them as well: women earn less because they get fewer hours and because they are less likely to be promoted to higher paying roles.

In 95% of all occupations, men have a higher average income (represented by the dots above the 45-degree line below).

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This is not because these occupations have more men in them. Men still have a higher average salary in 87% of the occupations where women make up more than 60% of the workforce.

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The stark examples are at the extremes. Plumber is the most male-dominated occupation, while midwife is the most female-dominated one.

Men have a higher average salary in both:

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A major issue is women leaving work to raise children – more likely to be done by women than men. Women are also more likely to do unpaid work in a household than men (even if both work).

This creates a perception that affects the ability of women to get promoted. Women are much less likely to be employed as a manager. Even in healthcare and education, where women account for the large majority of workers, they are underrepresented among managers in those industries:

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Our report shows that things have improved and the gender pay gap is closing, but it remains at least 30 years from disappearing if we continue at the same pace.

So long as women are expected to do most of the unpaid work because they earn less than men, they will continue to be given less and lower paid work. And the cycle will continue.