Jo Cribb is a consultant and the previous chief executive of the Ministry for Women.
Women, Māori and Pacific workers should be better off if the government were to introduce pay gap reporting – but by how much?
Opinion: $35 a week. A few coffees to get you through the week for some of us.
For others its about 2 bottles of milk and 6 loaves of bread away from hunger.
If you are earning the women’s median wage ($26.37 as of June 2021), this is how much more you might have in your pay packet if the Government introduces pay gap reporting legislation according to a new research paper released by Mind The Gap this week.
Pay gap legislation would mean that all businesses over a certain number of employees must publish their gender pay gap. Not wanting to publish large gaps or gaps that are growing or static, business leaders work harder to reduce them.
When the UK government introduced pay gap reporting, researchers found that it dropped the gender pay by 19 percent. A Canadian study of pay gap reporting laws in universities found that drove a 20-40 percent decrease in the gap.
If the same were to happen here, that works out at about $13-36 a week more for women earning that women’s median wage. That could be up to $1788 extra a year.
But. There is a big but.
Labour markets are complex and pay gap reporting might not have the same impact on our wages as it did in the UK and Canada.
This might mean that the impact will be more here. The UK government required businesses over 250 employers to report whereas the Mind the Gap campaign is calling for all employers over 50 to do so. More workers covered equals bigger potential impact.
But it is hard to know.
Especially since the UK and Canadian research was done pre-Covid.
Covid has played helter skelter with our labour market patterns. The Covid knock-on the construction boom and investment in shovel-ready projects has seen a boom in wages for the predominantly male construction workforce which may see the gender pay gap grow. But in times of full employment, more women are hired, which could decrease the gap.
And the gender pay gap is a blunt measure. Pay gaps for Pacific and Māori and ethnic women are much greater than averages. Māori and Pacific and ethnic men experience pay gaps as well.
Mind the Gap wants ethnic as well as gender pay gaps reported.
Given the caveats about super-imposing evidence from other countries into an Covid-muddled labour market, what this exercise does show is that women, and Māori and Pacific workers should be better off if the government were to introduce pay gap reporting.
The question is just by how much each week.
Pay gaps have existed for decades. Without intervention, they will continue to exist, long after this period of inflation has passed.
Pay gap reporting is not only about correcting any discrimination around pay today, it’s a long-term investment in equal, fair workplaces.
But it needs to happen quickly because so many families know that right now, every cent counts. Especially those missing dollars that are driven by discrimination in the workplace.