Australia's Gender Pay Gap in 2024: Key Insights from the latest WGEA Scorecard.
This year has marked a monumental step forward in addressing Australia's national gender pay gap (GPG). For the first time in history, the Workplace Gender Equality Agency (WGEA) publicly disclosed pay gaps across various sectors. This landmark move represents a significant advancement in the fight to eliminate gender inequality in the workplace. By adopting a transparent approach, WGEA is holding organisations accountable, compelling many companies to explain and contextualise their gender pay gaps to a broad range of stakeholders.
Reach out to me today to discuss how to deal with your key stakeholders in the lead up to WGEA publishing companies’ gender pay gaps early next year - including your CEO! We don’t just create award-winning technology. We also offer broad-ranging advisory services on all strategic matters, from reducing your gender pay gap, reporting to WGEA, right through to remuneration and benefits. So many of our clients have found our advisory the first critical step in their journey to create a fairer and more equitable workplace.
So, a year on from the last reporting – where have we landed, and what have we achieved as a nation, and are things tracking in the right direction?
The Headline Stats…
Overall, on a like-for-like comparison basis to last year, the national gender pay gap reduced from 21.7% to 21.1% (0.6pp reduction). However, for the first time this data set includes executive remuneration (including CEOs) and as such WGEA is reporting an overall increase to the national GPG of 0.1pp - landing on a new national figure of 21.8%.
What did this mean at the employer level?
Overall, 56% of organisations reduced their average GPG in this reporting round, but 44% saw an increase in their average GPG. This suggests that organisations are taking more action when it comes to addressing their GPGs, and the data certainly seems to support that. This year 68% of organisations said they undertook a gender pay gap analysis – up 13% from the previous year. More insights on all this later.
And the pay rises went to….
When it came to year-on-year pay increases, the money was flowing to women, with an average 6.6% increase against the average man bagging a 5.9% increase. Pleasingly, the biggest beneficiary of these increases was the lower quartile of the non-manager cohort (12.5% YOY increase). Some of this was due to pay increases awarded to lower pay quartiles across the Aged Care Residential Services sector. The recently announced pay bump to some 200,000 childcare workers across Australia should add to this once it comes into effect over the next 12-24 months.
The 'manager' category saw bigger increases awarded in all quartiles. We can only infer that these increases stemmed from correcting identified pay gap issues, but it is a strong signal action is being taken to correct issues around fair and equal pay.
As a woman’s age increases, so too does the gender pay gap…
This year was the first time WGEA collected age data as a mandatory requirement. The finding here showed that as a woman's age increases, so does the gender pay gap – peaking at age 55-59 and remaining high until retirement. The only point of a woman’s career where there is no pay gap affecting income is from the age of 15-19.
From that point on, the pay gap started to grow each year and gradually increased until retirement. The data also showed that women in full-time employment exit the workplace at a much quicker rate than men from the age of 55 until retirement. We can only wonder if there is any correlation between the data points?
The rise of the gender pay gap analysis – but have we nailed it?
I found this one of the most interesting insights in this year’s scorecard. So, as you can see below – companies were 13% more likely to conduct a gender pay gap analysis than prior to the WGEA publishing pay gaps earlier this year. This is great, I thought – until I read the finer details.
When the GPGs were published – there was much talk on the difference between the GPG and equal pay for equal work. Most companies responded in their Employer Statements that although a GPG may have existed in the organisation – they had equal pay for equal work. Whilst that may be true, this is the difference in understanding pay equity versus the gender pay gap. What was fascinating to me in these results was whilst 77% of companies did a ‘like for like’ pay analysis, only 52% of those who undertook a pay gap analysis looked at a by-level analysis.
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Why does this matter? Because the other half of the pay equity equation is analysing roles of equal or comparable value.
The Fair Work Ombudsman defines gender pay equity as follows:
"Workplaces achieve gender pay equity when all employees receive equal pay for work of equal or comparable value.
This means:
This is the money shot. In fact, this is often where we see GPG stem from– and it’s often the harder part of the pay equity equation to analyse and fix – it’s more complex for organisations to formally define roles valuing equal skill and responsibility. It is also important to note that equal pay for equal work has been required by legislation in Australia since 1969. It is not only a legislative requirement; it’s often just the start of understanding the nuances of the gender pay gap.
Every single industry in Australia has a gender pay gap...
One of the most damming statistics – clearly showing how far we have to go – is that no matter the industry – even women-dominated ones – there is a gender pay gap. Yes, every single industry in Australia has a gender pay gap.? Even where they are industries dominated by women in terms of representation.
To provide context - below is the proportion of women's and men's average total remuneration by industry as collected by WGEA.
Whilst it's evident that industrial gender segregation is a key driver of the gender pay gap, it's still a persistent theme in industries where the fundamentals should level the playing field, but... the data paints a different picture.
The Future: Corporate Australia in closing the gender pay gap
Overall, I’d say from the data that we are on the right path forward in terms of addressing this complex issue. I’m still hearing the noise from organisations in terms of not agreeing with how the government ‘calculates the numbers’ and many other of these retorts, but what I say to every organisation I talk to is this: The government are providing headline metrics for gender inequality across the country.
This is just the starting point. You are telling the story - It is incumbent on any organisation to do the work internally to understand and explain the gender pay gap and comply with the law on equal pay for equal work.
As the appetite for pay transparency across the country continues to increase, as we’ve seen globally, I have no doubt employees will become more curious, and companies will have more explaining to do. What we see today is just the start, and it’s not lost on me how complex and confronting this can be for an organisation. I’ve worked in it as an HR leader, and I live and breathe this daily.
It's also why we’ve built the first tech solution in the country to assist organisations in dealing with all aspects of pay equity, the gender pay gap, and overall equality for Australian workplaces. We don’t just do tech - our advisory practice can help you take the first step of your journey.
If you want to learn more about how equidi can accelerate your organisation's progress, then reach out to me today!
All data sources in this newsletter came from the WGEA Scorecard 2023/24.