Gender Paygap over a Working Life

Queen Victoria Women's Centre

The cost of womanhood
Posted on 23 May 2017

By Jane Gilmore

The official gender pay gap in Australia is 16% (Workplace Gender Equality Agency). That seemingly small number adds up to a gigantic difference between men and women, especially as women age.

Instead of dry numbers and statistics, let’s apply them to the lives of two average, middle class, white Australians – John and Mary – to see how economic discrimination affects women’s lives.

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I know that article from somewhere....

 

It could be more equitable if childcare system was fixed.
Because there is little money in it, its usually not high on any politicians agenda.

 

It could be more equitable if men stayed home with the kids more!

 

I thought there was a lot of taxpayers money going into the Childcare Industry. I have no idea how to fix something that is a stalemate - the staff want to be paid more but nobody wants to increase fees.

When I had a perfectly good part-time job the NAB and a one year old, I ended up resigning because it cost me almost my entire week's post-tax pay in childcare fees and other costs directly related to being employed.

The above example is about a graduate. Imagine how sad I am as a well-qualified and extremely experienced person working in an industry similar to childcare that does not value the Profession. We have low paying roles just because the community refuses to spend any more funds increasing our wages. If it was up to some politicians we would have our wages cut or our roles totally disappear. For those who don't know, I work with children who have disabilities.

 

What would the outcome have been had Mary decided to start being employed in a specialist field of accounting rather than a generalist role of office administration which has hordes of potential applicants?

What if Mary hadn't taken years out of the workforce to raise children and instead continued to up skill and aggressively climb the corporate ladder like John did?

I don't deny that there is a gender gap in the workforce but articles like this suggest that employers should be responsible and reward decisions to raise a family and take time out of the workforce. Employers tend to reward behaviours and skill sets that benefit the employer, not the employee. If you want to be financially rewarded in the workforce, you have to be there and you have to be more valuable than others.

Sadly I frequently see women coming out of a separation financially devastated and their only way out of it is to find another partner to support them. For many women a man is their financial plan. It shouldn't be that way but it's up to them to take control of that.

Show me a Mum that doesn't think she can raise her kids better than a nanny if only she had the time? Despite this the nanny has more formal qualifications and skills directly related to the job. You don't need a first aid certificate and working with children certificate to be a mum.

Objectively speaking, childcare is an oversupplied job. At some point almost all women and many men spend a significant amount of time in this role. It's not a role that's ever going to be well paid in a professional capacity simply because there's so many people who can and want to do it.

On a happier note, on two of the three fact finds I reviewed today, the woman earned more than the man. They all have kids as well. One one of them the pay difference was so much it makes me suspect he was a stay at home dad.

Tomorrow morning I'm interviewing a mum returning to work as an admin assistant. The salary is probably going to be at the upper end of the industry award for the position. If she's as great as I suspect she might be there's two possible paths:
1. She'll be great at the job but want something more diverse and when her kids reach high school she'll quit and I'll have to find a replacement. This worries me.
2. She'll be great at the job and for every hour she works, she'll give me back 45 minutes of my time. If she can achieve this and then asks for a 50% pay rise, I'll be happy to oblige.

 

50/50 divorce settlement is completely unrealistic in the quoted case. Mary should have got a better lawyer. Also, having $25K + $39K = 64K income with 3 kids will make her eligible for Centrelink assistance (FTB).

But yeah, having 3 kids with absolutely no marketable skills and no savings except house equity, is risky.

 

I don't really understand it.

John and Mary met at university and they quickly found work after graduating at 23. John’s accounting job paid $48,000 and Mary’s administration job $40,000. It’s a relatively small difference in wage so far.

At 28 they married and were both promoted. John’s salary increased to $62,000 – he’d put in a lot of overtime and got yearly bonuses worth $10,000 over five years. Mary’s salary was $49,000, but she didn’t receive any bonuses or overtime as they are rarely available to admin staff.​

The article seems to be implying that Mary earn less because she is a woman. In reality she is earning less because she is working in admin as opposed to accounting. If John and Mary both went to uni, both got accounting degrees, both got jobs as accountants and then John earned a higher salary, that's gender discrimination. Pointing out that an accountant earns more than admin staff is not gender discrimination.

I am more concerned that Mary went to uni, got a degree and then settled for a low paying administration job.

I also don't like that it paints women as victims "It’s time we stop avoiding the real cost of being a woman." Is Mary a victim or being a woman or a victim of poor decisions? I know it's complicated and there are certainly gender equality issues at play here. But to write the whole thing off as: Mary got treated unfairly because she is a woman, is superficial, unconstructive and incorrect. Perhaps Mary was raised to believe she should be responsible for the carer role because she is the woman and her husband would be responsible for the provider role because he is the male. That's the kind of gender inequality we should be concerned about. If Mary was raised to believe she should be the provider, maybe she would have become the accountant and let John raise their children.

I am not trying to be offensive. I just don't like these women as victim articles because I was raised by a woman who had a successful career after having children and who graduated with a Masters degree before I did.

 

The word 'risky' has the connotation that she's made a choice to select another, less-risky option.

Not too sure she's in this position as a result of her own choosing/actions - I'm sure she'd be in a better position if she had a choice....

 

I didn't notice Mary being portrayed as a victim. I suspect I am too kind and yet others would see her as a victim, based on their personal agendas and the construct initiated by the organisation publishing this article.

Rather, as you say, she made bad choices. When I read this article, I saw a case study of a fairly typical scenario. We make choices - Mary made choices and the natural consequence was that at the end of her working life, she was in a worse financial situation than John. This is how it worked out. I didn't interpret that the author was suggesting that an Admin Officer should get paid the same as an Accountant. I took it to imply that had Mary continued working in the (implied) Public Service that she would get promoted, but she didn't stay in full-time employment. This is the result of that choice.

 

I am 56 and had my first child in 1988. When I was in my 20s and early 30s, there were very few options for childcare. We couldn't just leave the kids and continue our careers like some of you suggest - the facilities didn't exist. I think the current generation of Johns and Marys will be able to exercise greater choices than I did at their age. This is, I believe, I good thing.

 

They are misusing the ABS data - that publication has a specific warning on it saying that it shouldn't be used for this type of comparison as it's statistically incorrect.

Comparisons of average earnings: males and females
AWE statistics show a difference in average earnings between males and females. This is at least in part due to compositional factors that impact on earnings and are not adjusted for in the AWE series, such as:

• employee characteristics such as age, experience and training,
• hours worked,
• employment conditions, and
• occupation.

For example, data from Employee Earnings and Hours, Australia (EEH; cat. no. 6306.0) reported that in May 2014, male employees were predominately full-time (76.6% of male employees). In contrast, more female employees were employed part-time (56.2%) than full-time (43.7%). As such, it would be expected that, on average, men would be paid for a higher number of hours of work than women. If, for comparison purposes, the population is restricted to only include full-time non-managerial employees paid at the adult rate, differences still remain in the number of hours paid for men compared to women. EEH data reported that the average weekly total hours paid for full-time non-managerial employees paid at the adult rate was 40.7 hours for males and 38.3 hours for females.

The Labour Force Survey provides a wide range of data relevant for examining the composition of the workforce. For example, data from Labour Force, Australia, Detailed, Quarterly (cat. no. 6291.0.55.003) show large differences in the proportion of males and females employed by industry. In May 2014, most employees (85.9%) in the highly-paid Mining industry were male. In the lower paid industries of Accommodation and food services and Retail trade, the majority of employees were female (both 56.4%).

Because of these compositional factors, AWE statistics cannot answer whether males and females receive 'equal pay for equal work'. Also as it does not collect the relevant information, AWE is not suitable for determining the causes of differences in average earnings between males and females.
​

It is pretty obvious that the bulk of the "gap" is due to occupation which I'm not sure how you could even change. After this, this secondary factors would taking time off to raise kids and generally working less hours and wanting flexibility.

Men largely choose their occupation based on earning potential (because men are raised to be a "provider" above other things and are judged on this) whereas women have more social freedom to choose an occupation based on their interests, the flexibility it provides or many other factors rather than salary.

 

Those choices would have been made for the 'good of the family' in conjunction with her husband.

Mary didn't choose a 'man as a financial plan' any more than her husband chose her as a free babysitter.

From the outside, especially if you are a man, it looks simple. But the decisions Mary made are actually both Mary and John's decisions. They are all small decisions at the time, made in a loving relationship. But cumulatively, after a divorce they can be catastrophic.

The thing is, most men don't choose to be stay at home dads -because it is a lower status and lower paid activity.

Don't forget, ABS statistics show that even when both parents work, men still do less of the household chores.

 

Sure men generally pursue well paid fields such as IT and Engineering... But studies have shown that even as graduates men earn more money. IMO this is because of the perception that men are a longer term investment. They are less likely to take 'career breaks' to raise families and the like.

I don't like the above example... Because it starts with a choice to enter a low paid field and subsequent choice to take a break from earning...

Male graduates earn more than female graduates: study

 

That has the same problem. You can't compare say an engineering graduate with an arts graduate. Yes, they both have degrees but even entry level jobs that require degrees don't all have the same starting salary.

 

I don't think the article is suggesting gender discrimination.. But rather circumstances eg staying at home to look after kids has detrimental impacts on career.
Even if Mary was just as well qualified as John, being out of the workforce for an extended period of time will likely have a detrimental impact on career. That's with anyone - John, Mary, the neighbours dog, the neighbours dogs fleas..that part applies to anyone. Just that in this case, Mary wanted or had to (I'm not sure, maybe both ) stay at home.

 

How about some fact......this is not theory.

I work opposite a woman, same job, I am paid less & too top it off, if I stuff up I will be gone, but not the women.

so that is my lesson in PC gone mad, yes, there is inequality everywhere, it should not be assumed it is only one group or sex, we used to say when young, life is not fair..... nothing has changed really, but I see it shifting the other way.

Also, unfortunately there are not many meritocracies.

 

She had a choice not to have 3 kids. She could retrain at 42 for a better paying job.

The article is complete bogus anyway. Mary was divorced at 42 and at that time had $123K in super. How is it possible to have $139K in super at 65 if she has been working at least for 10 years with $25K job ?

 

Not sure. The tag line of the article is the real cost of womanhood, implying all these things were done to Mary because she is female. There is underlying gender inequality issues but I am not sure they are about pay.

 

It would be more equitable if that happened. I only know 2 couples where the woman is the provider and the male is the carer. In both cases because the woman earned more. It's sexist!

Mary could have been raised by parents to believe she could be a doctor, lawyer or entrepreneur. Perhaps she was raised to believe the most she could achieve was admin? If she had been earning more than John then maybe she would not have chosen to stay home and raise the kids. Of course I would like Mary to have the choice to stay home and raise kids if she wanted to. It's more that it should be a genuine choice and not automatic because she is the female. But then if she chooses to put her career on hold while she raises the kids then it isn't valid to say she earns less when re-entering the work force because of her womanhood.