Gender pay gap due more to fewer women in higher-paying jobs than unequal wages, study finds

The Korn Ferry Gender Pay Index showed that men are paid on average 16.1 per cent more than women on a global level.
The Korn Ferry Gender Pay Index showed that men are paid on average 16.1 per cent more than women on a global level.ST PHOTO: KUA CHEE SIONG

SINGAPORE - The gender pay gap may have less to do with discriminatory wages and more with fewer women than men holding higher-paying jobs, consulting firm Korn Ferry said in a global study.

That the average woman is paid less than the average man is a statistic that has been demonstrated in a number of studies, Korn Ferry said. Indeed, the Korn Ferry Gender Pay Index, which analyses more than 12.3 million employees in 14,284 companies in 53 countries, showed that men are paid on average 16.1 per cent more than women on a global level.

But the gap fell to 5.3 per cent globally when evaluating the same job levels alone, such as people holding a director position. The gap was further narrowed to 1.5 per cent when considering the same level at the same company. If men and women at the same job level and in the same company were also in the same function, the gap shrank to 0.5 per cent.

The magnitude of the gender wage gap may therefore be more reflective of the fact that women are less represented in better-paying jobs, and not companies paying women less for the same kind of work.

Bob Wesselkamper, Korn Ferry head of Rewards and Benefits Solutions, said: "This pay gap issue can be remedied if organisations address pay parity across the organisation and continue to strive to increase the percentage of women in the best-paying parts of the labour market, including the most senior roles and functions such as engineering and other technical disciplines."

In Asia, the study found that women make, on average, 15 per cent less than their male counterparts. The average gap is widest - at 19.3 per cent - in Asia's mature markets, like Australia and New Zealand. But in Asia's growth markets like China and India, the gap is lower at 14.4 per cent; in the fast-growing markets like Indonesia and Vietnam, the gap narrows further to 11.5 per cent.

Female employees are actually favoured in fast-growing markets. Women in these markets are paid 1.3 per cent more than men working at the same level at the same company. Women are paid 3.1 per cent more than men at the same level, company and function in these markets.

Dhritiman Chakrabarti, senior client partner, Regional Rewards and Benefits leader for Asia Pacific, Korn Ferry Hay Group, said: "Our research shows women have the skills and competencies needed to ascend to the highest levels within organisations, and it should be a business imperative for companies to help them get there."