Women Graduating in 2020 Could be First to Achieve Pay Parity
Friday, 10th March 2017 at 2:39 pm
The class of 2020 could be the first generation to close the gender pay gap, according to new research.
A report from global professional services company Accenture found if women took advantage of three “career equalisers” alongside business, government and academia support, the pay gap in developed markets could close by 2044.
This means that women who graduate in developed markets in 2020 could close the gender pay gap within their professional lifetimes, shortening the time to pay parity by 36 years.
In developing markets, the changes could cut more than 100 years off the time to reach pay parity, achieving it by 2066 instead of 2168.
Accenture Australia country managing director Bob Easton told Pro Bono News the pay gap wasn’t “just important for women”.
“The gender pay gap is an economic and competitive imperative that matters to everyone, and we must all take action to create significant opportunities for women and close the gap more quickly,” Easton said.
“Helping women earn the same as men and encouraging them to play a similar role in the labour market will contribute to the overall economy.
“According to research from the UN Foundation, women reinvest 90 per cent of their income back into their families, while men only invest 30 to 40 per cent.
“If women were to play an identical role in labour markets to that of men, as much as $28 trillion, or 26 per cent, could be added to the global GDP by 2025.”
According to the research, women were much less likely than men to have paid work (50 per cent and 76 per cent, respectively) contributing to a “hidden pay gap” that increased the economic inequities between men and women, with women globally earning $100 for every $258 a man earns.
In Australia the current disparity between men and women’s earnings was greater than the average in other developed markets, with women earning an average $100 for every $185 a man earned compared to $140 globally.
Easton said it could be due to low participation in the workforce.
“Almost one-third (31 per cent) of the pay gap in Australia is due to lower female participation in the workplace, and another third (34 per cent) is due to women who are in the workforce working fewer hours than men. These relatively high numbers of low participation could be a factor,” he said.
The research, which surveyed more than 28,000 women and men, including undergraduates, in 29 countries, also identified several critical factors that affected a woman’s ability to achieve equal pay as early as university.
In particular the report flagged that the choices female undergraduates were making were setting them up to enter the workforce with fewer digital skills, less mentoring advice and lower interest in pursuing high-paying jobs, compared with their male peers.
Female undergraduates in Australia were currently less likely than their male counterparts to choose an area of study that they believed offered high earning potential (32 per cent versus 40 per cent), have a mentor (46 per cent versus 71 per cent) or aspire to senior leadership positions (38 per cent versus 44 per cent).
Additionally, young women lagged in adopting new technologies quickly (51 per cent versus 75 per cent) and in taking coding and computing courses (61 per cent versus 84 per cent).
Easton said those decisions were causing women to trail their male peers, who were strategically upskilling and choosing classes critical to boosting their future earning power.
“Universities and colleges must raise awareness with women undergrads about the impact of course choices on future pay and advancement,” he said.
“They also must develop more tailored programs that appeal to women’s interests.
“Finally, they can inspire young women toward careers in technology by offering role models, summer immersion programs and mentoring.
“Additionally, the government can play a strong role in helping women undergrads pursue digital and career skills. For instance, governments can encourage educators to make their STEM subjects more appealing and accessible to young women, at every grade level.”
The report, which builds on Accenture’s 2016 research on closing the gender gap in the workplace, identified three accelerators to help women close the pay gap:
- Digital fluency – the extent to which people use digital technologies to connect, learn and work.
- Career strategy – the need for women to aim high, make informed choices, and manage their careers proactively.
- Tech immersion – the opportunity to acquire greater technology and stronger digital skills to advance as quickly as men.
According to researchers applying these career accelerators, combined with support from business, government and academia, could reduce the pay gap by 35 per cent by 2030, boosting women’s income by $3.9 trillion.
Easton said the latest report, Getting to Equal 2017, showed the gap could be closed.
“The results demonstrate that there is still a pay gap in the global workforce,” he said.
“However the opportunities we have to close the pay gap are incredibly positive.
“Women could close the pay gap if they take advantage of three career equalisers and if business, government and academia provide critical support for these equalisers.”
He said in Australia there were “forces already at play” from businesses, government and academia that would support women in closing the pay gap.
“For instance, the National Broadband Network will play a huge role in providing internet access for all Australians, which will help boost women’s ability to gain digital fluency,” he said.
“Additionally, the federal government has committed $13 million over five years to encourage more women to choose and stay in STEM research, related careers, startups and entrepreneurial firms.
“If trends like these continue, it is likely Australian women will take advantage of the three equalisers.”
Accenture chairman and CEO Pierre Nanterme said gender equality was an essential element of an inclusive workplace.
“Business, government and academia all have an important role to play in closing the gap,” Nanterme said.
“Collaboration among these organisations is key to providing the right opportunities, environments and role models to lead the way for change.”