The Gender Pay Gap and Gender Mainstreaming Pay Policy

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The Gender Pay Gap and Gender Mainstreaming Pay
Policy

• Jill Rubery, Damian Grimshaw and Hugo Figueiredo
• European Work and Employment Research Centre
• UMIST

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The adjusted or the unadjusted gap?

• Review of recent empirical literature raised
  following questions
• Why has progressive closing of the gender gap in
  education and experience not led to a significant
  closing of the gender pay gap?
• Why do the returns to characteristics such as
  education and experience, vary between member
  states and over time?
• Are variables such as occupation or part-time
  work voluntary choice factors or part of the
  wider process of gender discrimination?

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New approach within comparative econometric
studies

• reveals that differences in wage structures
  between countries and over time are important in
  explaining differences in gender pay gap
• workplace characteristics such as gender
  segregation often prove to be more informative
  than personal characteristics

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Examples of studies where workplace
characteristics are important in explaining the
gender pay gap.

• Portugal - 1 increase in female share at
  workplace leads to decrease of 0.18 in hourly
  wage
• UK - Female share of work group explained 25 of
  gender pay gap for full-timers, 10 of female
  part-time/male full-time gap
• France - Higher educated females earn 97 of
  average male earnings in female-dominated
  workplaces-143 in male dominated workplaces

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Contrasting the mainstream gender pay gap
approach to a gender mainstreamed analysis of
pay gaps

• Traditional approach divides the gender pay gap
  into
• share that can be attributed to differences in
  personal characteristics associated with
  productivity
• share that is unexplained and therefore
  associated with discrimination
• But this approach focuses on gender deficits and
  not on gender discrimination embedded in the work
  environment and labour market

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Gender mainstreaming of pay policy required

• Shifts the focus from female deficits or
  deficiencies
• Investigates/ roots out discrimination embedded
  in institutions, social norms, market systems and
  pay policies.
• Involves looking for/ trying to remove gender
  discrimination effects from policies and
  practices that may appear gender neutral

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Key Observations

• Differences/ changes in wage structures are
  important in explaining the gender pay gap
• Gender segregation means that pay policies and
  practices are likely to have differential gender
  effects
• Wage structures are not simply explained by
  productivity - they reflect current and
  historical influences of social, institutional
  and market processes
• Public sector pay determination involves social
  choices.

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Gender MainstreamingI. Wage structures as social
choice

• Gender pay gap at lower and upper ends of the
  wage structure varies by member state- Indicates
  need for a more differentiated policy agenda
• Pay in female-dominated occupations varies
  between countries
• Variations in differentials not fully explained
  by the overall wage dispersion

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Table 4.a. Relative pay in female-dominated jobs
an OECD comparison
Source OECD (1998 tables 2.4 and 2.5), based
on Grimshaw and Rubery (1997 tables 13,14 and
appendix table 5).
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Table 4.b. Relative pay in female-dominated jobs
an OECD comparison
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Gender MainstreamingII. Collective bargaining
systems

• Women may be less likely to be covered by
  collective bargaining 
• Female sectors may be lower paid if wage
  determination decentralised
• gendered norms and valuations may be embedded in
  job gradings
• Changes in social norms and values towards
  individual payments- may be increasing
  discretion/ discrimination in pay systems

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Gender MainstreamingIII. Minimum wage systems

• Women are more likely than men
• to be concentrated in jobs affected by minimum
  wage regulation
• to be in jobs/ sectors where there is limited
  scope for collective bargaining - increasing the
  importance of minimum wages
• to be in jobs that may be excluded from minimum
  wages -making the coverage and enforcement of
  minimum wage regulation of particular importance.
  

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Gender MainstreamingIII. Minimum wage systems,
ctd.

• Need to gender debate on policy in the low paid
  segments
• No reference to gender in
• Policies to promote low paid employment
• New systems of in-work benefits
• New campaigning needed to establish the minimum
  wage as a living wage as in the US

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Gender MainstreamingIV. Pay policies at the
company or sector level -- Private sector

• Women are losing out in higher returns to skill
• Trend towards decentralisation means more
  discretion for management
• Restructuring and subcontracting - workers
  transferred from public to private sector
• Change to benefits systems e.g. UK employers
  ending final salary pension schemes - women
  receive lower pension with money purchase schemes
• Continuing problem of informal sector

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Gender MainstreamingIV. Pay policies at the
company or sector level -- Public sector

• Women account for a disproportionate share of
  public sector employment
• The public sector plays a different role in
  shaping the gender pay gap high pay in southern
  countries, lower pay (or declining pay) in
  Scandinavian countries
• Restructuring of the public sector, involving
  privatisation and subcontracting to the private
  sector

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Gender MainstreamingIV. Pay policies at the
company or sector level -- Some examples

• New mainstreaming law in France on equality
  bargaining
• Equal Opportunities Act in Sweden - backed by
  legal requirements for disclosure on pay
• Trade union campaign on two-tier workforce in
  public sector restructuring in the UK

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Conclusions

• The traditional or mainstream approach to the
  gender pay gap has
• focused primarily on gender gaps/ womens
  deficiencies
• not provided a very good guide to policy
• left out of account the influence of the work
  environment  
• There is a need for gender mainstreaming of pay
  policies and practices

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Little evidence of a mainstreaming approach in
practice

• The three most important elements of pay policy
  over recent years
• trend declines in the minimum wages,
• moves towards more decentralisation and
  individualisation,
• restructuring of the public sector
• But all carried out with little or no reference
  to the gender effects
• Need to consider
• what constitutes an appropriate level of wages at
  the bottom of the labour market
• whether increased employer discretion and
  increased wage inequality adds to productivity