Gender pay gap in management ranks approaching 45%, new data reveals | Women's Agenda

Gender pay gap in management ranks approaching 45%, new data reveals

Women in the top levels of management are getting paid up to 45% less than their male colleagues, according to data released today.

The Workplace Gender Equality Agency has released a management-level breakdown of its groundbreaking data revealed last November, detailing the current state of gender equality in Australian industries.

The results are particularly disheartening when analysed based on individual levels of management.

Overall, WGEA found last year that the gender pay gap sits at 24.7% across all industries. However, today’s data reveals that for women at the highest levels of management, these figures are far worse.

The largest gender pay gap exists for what WGEA terms ‘key management personnel’, which refers to employees who are responsible for a major organisational entity, such as heads of operations or finance.

Women in these management positions are subject to the largest pay gap of any employees in every industry. The average pay gap for these managers is 28.9%.

For key management personnel in administrative and support services, the gender pay gay sits at an alarming 44.7%. The arts and recreation industry has the next highest pay gap for these managers, at 35.1%.

So why are women in high-level management positions getting paid so much less than their male peers?

WGEA director Helen Conway believes one explanation could be that when women do ascend to these high level managing roles, they are still unlikely to be in the specific types of key management roles that are valued and paid the highest, such as heads of finance.

“The data clearly shows women in management aren’t accessing the same earning opportunities as men. This is partly due to the fact that women gravitate to roles the market typically assesses as being of lower value. For example, we know female KMPs are more likely to be in support roles such as human resources than line roles such as heads of finance,” she said.

Conway added the reasons women largely enter lower paying roles even when they reach high levels of management relate to structural barriers to entry.

“Employers who are committed to creating equal access to opportunities for women and men need to work harder to remove barriers that inhibit women from entering these higher paying roles. A lack of quality flexible work, the legacy of workplace cultures built on the male breadwinner model and gender bias are likely to be among the barriers that need to be tackled,” she said.

Another reason, according to the research, for these large pay gaps at management level is that women face a “double bind” when negotiating pay. This double bind refers to the fact that women are judged more harshly than men when they ask for pay increases and as a result women are less likely to do so, which then feeds back into existing pay disparities.

These structural and cultural barriers mean that even in female-dominated industries such as clerical work, there are persistent pay gaps that disadvantage women.

But high-level management is certainly not the only place the gender pay gap is troublingly wide.

At executive level, the industry-wide pay gap is 27.5%. For senior managers, the disparity is 23.5% across all industries and for all other managers it is 24.6%.

Key management personnel are also not the only employees for whom the pay gap is approaching figures as high as 40%.  For executive-level employees in the financial services industry, the pay gap is currently 34.4%.

Pay inequity also persists in all non-manager roles, according to the research.

Conway said that while gender differences in job preferences might be a factor in these large pay disparities, employers also need to consider factors like unconscious gender bias and gender discrimination. She said it is imperative for all employers to conduct thorough, like-for-like pay studies across all levels of their organisation to determine whether these factors are at play.

“Gender bias can create instances of women being paid less than men for the same or comparable work unless you analyse your payroll data and take action,” she said.

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