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Closing The Gap

Gender pay gap is set to remain until 2070 despite some progress


Leading economies have made progress in closing the gender pay gap in recent years. But it will be 2070 before it is completely eliminated — and that's only if efforts continue at their current rate.

That's the consensus of a new study from jobs site Glassdoor, which found that the gender pay gap — the average difference in salary between men and women — in the U.S. shrank by 2.7 percent in the past three years to 21.4 percent.

Put simply, women in the U.S. will earn $0.79 for every $1.00 men earn in 2019.

Glassdoor's findings are based on unadjusted figures, meaning that don't take into account statistical controls, such as worker age, education, years of experience, occupation, industry, location, year, company and job title. By contrast, when those controls are applied, the pay gap in the U.S. shrinks to 4.9 percent — down 0.5 percent from three years ago.

A tighter labor market, increased labor force participation by women, and greater awareness of the gender pay gap all likely contributed to the shift, the report found. However, at the current rate, it would take another 51 years to reach parity, it noted.

Over the past three years, company leaders, politicians, celebrities and more have called for an end to the gender pay gap.
Andrew Chamberlain
Glassdoor's chief economist

Those results position the U.S. in line with the Australia, France and the U.K., all of which have recorded a reduction in their gender pay gap since Glassdoor's previous study in 2016. In Germany, however, the gender pay gap has widened.

According to Glassdoor's study of more than half a million salary reports from employees in eight leading economies, France had the smallest unadjusted pay gap in 2019, at 11.6 percent, followed by Singapore (12.8 percent).

Germany had the largest unadjusted pay gap of all the countries measured, at 22.3 percent. The U.S. emerged with the second greatest unadjusted pay gap (21.4 percent), followed by the Netherlands (18.9 percent), the U.K. (17.9 percent) and Canada (16.1 percent).

When factors such as age and industry were accounted for, the adjusted gender pay gap was smallest in Australia (3.1 percent) and greatest in the Netherlands (6.6 percent).

The gender pay gap by country in 2019

Explained and unexplained causes

The Glassdoor report noted that the persistent gender pay gap can be divided into what can be "explained," for instance due to differences in worker characteristics such as age and education, and what remains "unexplained."

The explained category accounts for the majority (64 percent) of the overall U.S. pay gap, while 36 percent remains unexplained and could be indicative of workplace bias or negotiation gaps, it found.

One major explained contributor is what's known as occupational sorting, which refers to the industries and jobs that men and women typically pursue. That factor explains about 56.5 percent of the overall U.S. pay gap.

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In the U.S., the adjusted gender pay gap is highest for pilots (26.6 percent), followed by chefs (24.6 percent) and C-suite professionals, such as chief executive officers and chief financial officers (24 percent). Meanwhile, occupations with the largest reverse pay gap — where women earn more than men — include merchandiser and research assistant.

Computer programmers saw the biggest pay gap improvement in the U.S. in the past three years, falling 16.7 percentage points from a high of 28.3 percent in 2016 to 11.6 percent in 2019.

In terms of industries, retail and media accounted for the widest gender pay gaps, both recording a 6.4 percent disparity between men and women. They were followed by construction, repair and maintenance (6.2 percent) and oil, gas, energy and utilities (6.2 percent).

The industries with the smallest pay gap included the biotech and pharmaceuticals industry (2.2 percent) and education (2.4 percent).

Adjusted gender gap in base pay by U.S. industry

An age-old issue

Despite progress being made in closing the gender pay gap, this year's report found that, as in 2016, the issue remains most pervasive at the later stages of the career cycle.

Indeed, the gender pay gap among younger workers aged 18 to 24 (1.4 percent) and 25 to 34 (2.8 percent) saw improvements, shrinking 0.8 percent and 0.5 percent, respectively, in the last three years. Meanwhile, the gap for workers aged 45 to 54 (10.3 percent) and 55 to 64 (12.3 percent) grew 0.8 percent and 1.8 percent, respectively.

That is typically reflective of societal factors, such as women's departure from the workforce during child-rearing, which can limit their ability to rise in the ranks later in their careers.

Dr Andrew Chamberlain, Glassdoor's chief economist who led the report, said this year's study indicates that progress has been made because the gender pay gap has received increased attention over recent years. However, more remains to be done to speed up the process.

"Over the past three years, company leaders, politicians, celebrities and more have called for an end to the gender pay gap," said Chamberlain.

"Glassdoor's comprehensive study put those words to the test to reveal that slight progress has been made to close the gap. Though a promising sign, it should not detract from the larger fact that significant pay gaps remain around the world."

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PayPal CEO Dan Schulman on exactly how the company closed its pay gap
PayPal CEO Dan Schulman on exactly how the company closed its pay gap