The Economics of the Gender Pay Gap

Topics Gender
KPMG report cover

Recent public debate reveals widespread lack of community understanding about pay equity – what it is, why it exists, and what can be done to address it – as well as a tendency to minimise or explain away the gender pay gap in Australia through reference to ‘women’s choices.’

In mid 2016, in conjunction with the Workplace Gender Equality Agency (WGEA), DCA sought the assistance of KPMG Australia to update work they did in this field back in 2009 and thus help improve understanding of the underlying causes of the gender pay gap.  

A new report released on 28 October 2016 entitled She's Price(d)less: The economics of the gender pay gap uses structured econometric modelling to determine the factors that underpin the gender pay gap, and to what extent they contribute. 

The report demonstrates that pay inequity isn’t just a social justice issue – it’s an economic imperative. Case studies in the Executive Companion highlight the excellent work that Australian organisations are already doing to tackle pay inequality in their own teams, organisations and industry sectors.

DCA is proud to be part of this conversation and hopes that this report will be the impetus to closing the gap as soon as possible.

What is driving the gender pay gap?

The drivers of the gender pay gap are complex.  However disturbingly the report found the single largest factor contributing to the gender pay gap is sex discrimination and it is on the rise.

Other significant factors include human capital and educational qualifications, on-the-job training and accreditation, work experience and tenure.