JUSTIN LI
For decades now, the gender pay gap has always been a sensitive and significant topic. That society will ever reach true gender equality is a critical research question at the current moment, with the actual overall gender pay gap at an average of 9.53% in the UK, and 11.23% in the US, which is significantly high. More women are pursuing higher education in the UK, with 59.6% of graduates being female and 60% of essential workers, such as NHS workers, being women. So why aren't women being paid an equal amount compared to men?
The "#MeToo" movement highlighted the significant gender inequality in society, and people decided to protest for change against sexual harassment towards women. However, among the protests, the gender pay gap also started to be highlighted. A reason for why this pay gap exists is because of the stereotypes and assumptions made by firms, that women are more likely to enter the caring, leisure, secretarial or administrative jobs, and be paid less, while men are assumed to go into higher skill based jobs. Even when men and women have the same jobs, women will earn less than their male counterparts due to the fact that firms may think they will not do as good a job, which is undoubtedly false. Another reason for the gender pay gap can be attributed to women having children and entering motherhood, which can cause women to earn less than males of their station, as after taking time off of work to care for their children, they struggle to return to the same level they were at before, facing organisational barriers and obstacles that in this day and age should have been abolished. Suggestions that mothers are "less skilled and less productive" are outdated, but still held as a reason for many firms to decide to pay them much less than the men doing the same jobs. Yet, even with the reasons listed above, the UK government found that 64% of the gender pay gap could not be explained, which leads us to believe that it is primarily due to discrimination and sexism.
Increasing women's wages and minimising the pay gap between men and women would positively impact economic growth. However, companies are still reluctant to hire women, leading to a lower employment rate for women and potentially restricting UK growth. By neglecting the potential of women in the labour market, we see negative impacts on the income and occupational pensions for women, which undermines their economic independence. If employers decided to hire more women and created equal opportunities for men and women, this would lead to a massive upturn in the British economy. More women entering the labour force could mean up to 6 million more jobs by 2050 and a GDP increase of 5.5%. This would benefit us all. Studies have also shown that gender equality in one country can cause spillover effects in neighbouring economies, encouraging women's employment and economic growth in their countries.
Closing the pay gap carries other positive impacts, such as lowering poverty rates among women, augmenting the size of the dwindling labour force (to combat an ageing population), increasing the income and productive capacity in the economy, and reducing the gender gap in old-age pensions. A report also found that if women were paid the same amount as men in developing countries, this could increase their income by $2 trillion, which is around an 18% increase. A reduction in the gender pay gap can also increase women's confidence and allow them to gain more responsibility at work and progress into leadership positions. This is currently extremely relevant as in 2020, only 5% of FTSE 100 CEOs were women, showing the disparity between men and women in senior leadership roles. However, this disparity is decreasing, and women are now entering into such careers, and getting promoted, more frequently.
As we saw above, we do still have a long way to go until we reach true gender equality and eradicate the scourge of the gender pay gap. However, we have outlined the various economic benefits that will come from hiring more women and reducing said pay gap, leading the country to more significant economic growth, but more importantly, to a fairer economy and society.
Some countries have not been able to ignore these statistics and have decided to take action; notably Iceland has legislated to ensure that companies must pay their employees fairly, removing the pay gap. Some companies have implemented flexible policies to allow mothers to work full time and men to go on paternity leave, should this be desired. The regressive attitude that mothers should care for their children and fathers should be the breadwinners is starting to fade away. Governments worldwide have also commenced new programmes for young women to pursue higher education and skills training to expand the future labour force. By supporting young women to pursue high skill jobs, a considerable knock-on effect in the long run can be perceived, as these women can inspire future generations of young women and therefore spark an expansion in the number of women going into highly skilled and high paying jobs. Hence this inspiration can lead to a spiralling recursive improvement in society for women and fully remove the gender pay gap. In the below graphic, from the OECD, we can identify which nations have succeeded in eradicating, and even reversing the gender pay gap, while others still have plenty of work to do.
In conclusion, although new measures currently being implemented could take decades to show their final effects, all the measures outlined above are a step in the right direction, key to reducing the gender pay gap and building a fairer economy for women. Society is finally beginning to notice that more needs to be changed in order for everyone to become equal, be that to combat racism, homophobia, sexism or discrimination against many other minorities who are not being represented enough. As more attention is made towards talented, hard-working women and their contributions in the workplace, the issue of the gender pay gap will hopefully soon become a thing of the past, creating a better world and a better economy.
Chart Source:
OECD (2022), Gender wage gap (indicator). doi: 10.1787/7cee77aa-en (Accessed on 03 February 2022)
Comments
Post a Comment