Pay gap: Highest paid women earn $162,000 less each year than men

Highest paid women in Australia earn $162,000 less each year than men

The highest paid men in Australia are being paid at least $162,000 more than the highest paid women, according to a new report by the Bankwest Curtin Economics Centre (BCEC) and the Workplace Gender Equality Agency (WGEA) released today.

The same report shows that while women could be on par with men in most management roles within the next two decades, at the current rate of change women won’t reach parity at the CEO level until 2100.

The Gender Equity Insights 2019: Breaking through the Glass Ceiling’ report examines the gender pay gaps across occupations and industry sectors covering more than 4.1 million employees in Australia.

“Over the last five years, we’ve seen more women taking up senior management and leadership positions across Australian organisations, and the representation of women in management roles is currently very close to their share in the full-time labour force,” report author and BCEC Associate Professor Rebecca Cassells says. “However, women still face an additional barrier in terms of the pay that they can access when moving into management roles, and the number of female CEOs is increasing far too slowly, with parity not expected anytime this century.”

The research reveals that men are paid more than women at every level of management. The highest paid 10% of men take home a total salary of at least $598,745, compared to $436,369 for the highest paid 10% of women: a difference of $162,000.

The report also found that women are more likely to hold management positions at the lowest levels but earn at least $31,000 less than their male colleagues every year.

“For those women that do make it to the top, we are seeing an added glass ceiling,” Cassells says. “Women in top-tier leadership positions are taking home smaller pay packets compared to their male counterparts. Simply breaking through the glass ceiling doesn’t provide women with the same wage opportunities. It’s clear there are still barriers in place that prevent women from reaching their full potential.”

The research, which examines the role of workplace environments and policy initiatives in improving the representation of women in the workforce and in narrowing the gender pay gap, verifies a number of intuitive conclusions.

“We found strong evidence that more generous employer-funded paid parental leave schemes are associated with better rates of worker retention,” Report co-author and BCEC Director Professor Alan Duncan says. “Companies that offer at least 13 weeks of employer-funded paid parental leave halve the share of female managers who leave the company while on leave, compared to those who access only the government paid parental leave scheme.”

Employer-provided onsite childcare increases the retention of female managers during parental leave by 18.9%.

The availability of flexible work arrangements had a similarly positive impact.

“The share of women in part-time management roles almost doubled when the company’s flexible work policies were held to account by their boards, from 7.5 percentage points to 13.6 percentage points,” Professor Duncan said.

The share of female full-time managers increases by an average of 8.6 percentage points for  companies with a female CEO. Moving from all-male to gender-equal company boards increases the share of full-time female managers by 7.3 percentage points and the share of part- time female managers by 13.7 percentage points.

Gender pay gaps at different levels of management seniority combine to reduce the share of full-time female managers by an average of 9.9 percentage points, and the share of part-time female managers by 7.9 percentage points.

WGEA Director Libby Lyons said that the report confirms the importance of employers taking action.

“These findings reveal that if you change the working conditions available to employees, the choices women can make change too. By offering paid parental leave schemes and flexible work arrangements, more women are able to choose to return to work,” Lyons says. “Children starting primary school this year will enter a workforce where they are likely to see gender balance at most management levels. Yet they will have to live to be almost 90 to see women reach equality at the CEO level. So the evidence is there and we must keep pushing hard to break down the barriers women still face in Australian workplaces.”

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