Topic All Topics


Girls Down Under The Pay Ceiling

Girls Down Under The Pay Ceiling

It would be fair to say that we Australians pride ourselves on giving a fair go to everyone. So, how is it that Western Australia has a gender/pay gap of 24 per cent in full-time earnings? To put this into some perspective, the Whitlam Government abolished the 25 per cent mandated gender/pay differential for government positions in 1973. Yet 40 years later, the gap in the private sector essentially remains the same. While differential representation by men in high-paying sectors, such as mining and energy, as well as much greater representation in higher-paid senior positions accounts for approximately half of the difference, the remainder can only be explained by being female.

So, what’s happening in WA? An early key finding of the Committee for Perth’s Filling the Pool research project into gender equality underlines the importance of the so-called ‘Four Pillars’. Previous research has identified that working mothers must be able to rely on one or more of four avenues of childcare in order to progress: day care (childcare centres, nannies and au pairs, before and after-school care, and vacation care); their spouse; their own parents and extended family (or those of their spouse); and work flexibility. It would seem that the conditions present in WA create a Perfect Storm in which each of these pillars is significantly diminished compared to the East Coast. For example, childcare is more difficult to access, waiting lists are extremely long, and with only two day care centres in the CBD, there is a lack of places. Nannies and au pairs are often beyond the financial means of younger working families. The focus of WA’s economy coupled with its remoteness from other cities means that working spouses may be required to travel away from home in FIFO roles, travel to remote sites for supporting industries, or travel to the East Coast for meetings. In any of these scenarios, the spouse is not available to share the childcare burden. The third pillar – support from their own parents and extended family (or those of their spouse), is undermined due to the large working population of East Coast and overseas immigrants here in WA. Most families move to WA leaving behind their extended family networks. Finally, WA has been relatively slow to see organisations take a more active role in childcare assistance. This, coupled with the nature of remote work and perceived difficulties in providing flexible work to parents, leaves many families with no choice other than for one spouse to exit the workforce to undertake the childcare role themselves.

Under-representation of women in senior public roles is another issue. More than 113 years after women gained suffrage and the right to enter Parliament, we have fewer women in Federal Cabinet than countries like Afghanistan (which has three female cabinet members, compared to Australia’s lone Julie Bishop). The percentage of female CEOs of listed public companies in Australia is still under three per cent, and only one in ten senior executives in the private sector is a woman. It is significant that numbers in WA are even lower. People often say that it is just a ‘pipeline issue’ that will resolve itself within a generation. They have been saying that since the 1970s. Many people are unaware that women have been graduating from our universities in greater numbers than men since 1985. In fact, if you project the current rate of progress of women into CEO positions into the future, women do not gain parity until the year 2343.

The issue of gender equality in the workplace has vexed business for nearly two generations. To say the issue is complex is an understatement. But to lay the lack of progress on this issue at any single door is counterproductive, and a very simplistic view. Government policy at both state and federal level, organisations of every shape and size, schools, higher-education institutions, family, media, society in general, and men and women themselves all contribute to the stubborn persistence of low female representation in the highest ranks of office in every sector in Australia.

So why is this a problem? There are three obvious answers. Firstly, it is a social issue. What does it say about Australia if prejudice or discrimination prevents any group or individual in our society from achieving the same outcomes as anyone else? Secondly, it is a diversity issue. How is it possible for leaders to make the best decisions if those surrounding them do not represent diverse views, or are even representative of those they lead? Finally, it is an economic issue. Common sense dictates that if men and women are equally intelligent, creative and capable of leading people – and the overwhelming body of scientific evidence supports that they are – then we are letting the bottom 97th percentile of male talent lead our firms, while the third percentile of female talent is elsewhere. Studies by McKinsey in the United States and similar studies here in Australia show that the talent wasted equates to lost GDP of between 8-13 per cent. That means if we were to solve this one issue, the contribution to the economy would be such that Australia’s debt crisis would be fixed in two to three years.

In some ways, it would probably make us all feel a little better if we could say that the cause of gender inequality in leadership positions is a mystery, but this is simply not the case. Research in the area of causality has been extensive, with more than 2300 studies in the field. Many of the causes have been known for decades. While not an exhaustive list, these include the ‘pink and blue’ decisions we make in our schools and as parents, giving our children different experiences as they grow up; different expectations we place on men and women regarding the roles they should undertake in life and the degree to which they should share domestic responsibilities; differential evaluation of men and women in engaging in the same behaviours; the degree of direct and indirect discrimination experienced by women relative to men; restricted access for women to sponsors, mentors and key networks; differential value placed upon line versus non-line and flexible versus non-flexible roles in terms of pay and progression.

So if we know the cause of the problem, why does it persist? Perhaps an overly simple answer is that change is difficult when the status quo is well entrenched. It is easier to ignore problems and replicate what we do and what we think we know than to change. Change is dangerous. For organisations, or societies for that matter, to change there must be a compelling reason and clear evidence that a changed future is significantly better than the present. Sadly, despite growing evidence, most business leaders, MPs, educators and parents are either oblivious to the issue or are not convinced that gender equality should rank among the greatest strategic issues confronting Australia. In the meantime, every year, Australia slips further behind our competitors on this issue, foregoing the competitive advantage of utilising our best and brightest.

Fortunately, the last year or two has seen a renaissance, led by elements in the business community. Initiatives by the Australian Institute of Company Directors have led to double the number of women on boards. Federal Sex Discrimination Commissioner Liz Broderick initiated the Male Champions for Change in 2010, enlisting highly influential male CEOs and Chairmen to ‘use their individual and collective influence and commitment to ensure the issue of women’s representation in leadership is elevated on the national business agenda’. Here in WA the Committee for Perth, led by Marion Fulker, has brought together firms including Shell, Westpac, Worley Parsons and Ernst & Young, peak bodies such as the Australian Institute of Company Directors and the Committee for Economic Development of Australia, as well as the Department of Local Government and Communities through the Filling the Pool project. While acknowledging the causes of gender disparity, the focus of the project is practical advice for firms and individuals on addressing the issue.

The complete Filling the Pool report is due in June 2015 and findings already reveal a great number of practical interventions by business to address gender equality in the workplace.

For more details about the report, click here.

comments powered by Disqus