Sunday, June 16, 2024

How does US gender pay gap compare internationally? Pretty well, study says.

A new study on the gender pay gap internationally suggests that, well, it exists. And while this may not be news to economists and female employees alike, last week’s study by Glassdoor also suggests this gap shrinks when controlling for other non-gender-related factors such as occupation, industry, and experience.

The US is notorious for its sizable gender pay gap. In a 2014 report by the World Economic Forum, the US ranked 65th in wage equality among 142 countries.

But Glassdoor takes their recent analysis further, comparing the unexplained factors (presumed to be gender bias) between several developed countries. And in this comparison, the gender pay gap becomes pretty much even internationally, with the US falling in the middle of the pack.

“The ‘unexplained’ part is less than half in every country Glassdoor Research looked at, suggesting overt discrimination alone does not explain most of today’s gender pay gap,” Andrew Chamberlain, chief economist for Glassdoor, tells ABC News.

“The sorting of men and women into different occupations has emerged as one of the main drivers of the gender pay gap – a factor that has little to do with overt bias and reflects complex social pressures that divert women into some professions and away from others,” adds Dr. Chamberlain. “This points to the need for societal and public policy solutions that address these more subtle causes of gender pay differences.”

Chamberlain emphasizes that the encouraging numbers offered from the adjusted pay gap analysis does not mean that a problem doesn’t exist. For example, even though the gender pay gap shrinks when accounting for the lower proportion of women who work in a certain occupation, there are likely other entry barriers and social pressures that prohibited more women from entering a specific industry in the first place. Also noteworthy, the occupations with the biggest pay gaps are also the highest paid.

“For a whole bunch of reasons, through the education system and the workplace, women are being pushed into different kinds of roles,” Chamberlain tells Reuters. “This is the single largest factor we see contributing to today’s gender pay gap.”

But this recent study suggests that overt workplace bias may be more prominent in other countries compared to the US. Because although the gender pay gap is narrower in Australia and Germany than in the UK and the US, a larger proportion of it is unexplained in these two countries.

Sixty-seven percent of the gender pay gap in the US is ‘explained’ due to worker differences, and the remaining 33 percent is ‘unexplained,’ suggesting possible workplace gender bias. But this ratio is more prominent in other countries: 36 percent of the United Kingdom’s gender pay gap is unexplained, compared to 39 percent in Australia and 49 percent in Germany. France is the only country that has fewer unexplained sources than the US, at 29 percent.

In other words, the gender pay gap in the US is significant, but we can explain it: It stems from systemic problems in society such as educational access. Is that better than a smaller gender pay gap that can’t be economically explained? This is the question that Chamberlain, other economists, and world leaders might look to next.  

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Author: Red

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