The gender pay gap — alive and well, unfortunately

It’s illegal to pay women less than men in Canada—and has been for decades. Unfortunately, the gender pay gap, or difference in income between women and men, persists.

Show me the evidence — is there really still a pay gap?

Though the gender pay gap has decreased since the early 1900s due to more women adopting working roles, changes in legislation, and increased education, it’s still alive and well. Even though women enter professional schools to the same proportion as men, have a labour force participation rate of 82%, and are beginning to assume the breadwinner role at double the rate as they did in previous years, there’s still a 16.1% difference between annual median earnings of women relative to the annual median earnings of men in Canada.

It gets even more grim when you break it down by actual numbers: According to the Federal Government, a woman earned 89 cents for every dollar a man made.

While still grim, these numbers have been showing improvement. In 1998, the gender pay gap stood at a bleak 18.8%. However, the decreasing discrepancy within the past two decades can be attributed to stagnant and declining wages among men, rather than any notable increases in women’s wages.

When it comes to provinces within Canada, some are doing a better job than others. A 2020 report on average and median gender wage ratios calculated based on average hourly wages by Statistics Canada ranks Canadian provinces in the following order:

What about women of color?

Studies show that while women make disproportionately less money than men, women of colour make even less than white women. The gender pay gap is especially significant in the marginalized groups and minority communities as studies show Indigenous women face a 57% pay gap, immigrant women 39%, women with disabilities make 46% less, and racialized women 32%. The gender pay gap is everywhere, but it targets women at every race cohort differently.

While bridging the racial gender pay gap warrants a new article altogether, you can start by bringing awareness to the issue within and beyond your organization, encouraging pay transparency, supporting women of colour when negotiating salaries, and providing sponsorship and mentorship opportunities dedicated to women of colour.

What is the Federal Government doing to reduce the gender pay gap in Canada?

The Government of Canada has recognized this to be a critical issue and introduced the Pay Equity Act on August 31, 2021. Under this Act, employers must create a pay equity plan that compares the compensation between predominantly female and male job classes doing work of equal or comparable value. While clearly not enough to eradicate the gender pay gap overnight, it’s a good first step to ensure transparency and equal pay.

Why does the gender pay gap still exist and how do we fix it?

There are many factors contributing to the gender pay gap, as discovered through various expert studies. Here are a few reasons why women are still making less than men in North America — and ways to alleviate the problem.

Family obligations and perceptions of motherhood

Women are working more than ever, yet continue to make more career adjustments to accommodate family life than men. Take maternity leave, for example. The professor of Business Law at the University of Central Oklahoma stated that maternity leaves contribute to lack of salary and career interruption for women, and thus widen the gender pay gap. Since women take maternity leave almost twice as much as men do, they are disproportionately affected.

This disproportionate accommodation for family life could also explain why more women take on part-time work. Women’s higher rate of part-time work contributed notably to the gender wage gap in 2021, because part-time work offers lower pay, less job security, and fewer benefits than full-time employment.

This was even more obvious during the pandemic when more women were forced to quit their jobs and stay at home to take care of children in the absence of schools and daycares. The result? The pandemic made the gender pay gap worse, especially for women of color.  According to the National Women’s Law Center, since February 2020, women have lost more than 1.4 million net jobs and make up close to 70% of job losers since the start of the pandemic. Today, more than one million women are still missing from the labor force.

What we can do

1. Prompt companies to offer sufficient paternity leave and encourage fathers to take that paternity leave. This would help create a more even playing field for women, as men could relieve the career disruption women face when taking care of children. Paternity leave also balances the weight of domestic duties and childcare, thereby reducing the pressure for women to accommodate family life at the expense of their careers.

2. If you’re a man, realize this imbalance still persists and find out how you can help alleviate the disparity at home and at work. Advocate for paternity leave, implement a fairer distribution of household duties, and continuously check in on your partner to ensure you’re making progress.

Industrial distribution

According to Statistics Canada, three high-paying and male-dominated sectors in particular have contributed to the gender pay gap between 1998 to 2018: construction, manufacturing, and mining, quarrying, and oil and gas extraction. In spite of the high wage premiums, women comprise a mere 14% of jobs in the trades. Why? Many trades environments are unwelcoming to women, with barriers to entry ranging from lack of mentorship opportunities to a culture of rejecting workers who must leave by 5pm for childcare responsibilities. While more women are joining the trades now compared to a decade ago, there is still a long way to go.

But if we were to break down the gender pay gap by industry, you would be surprised to know male-dominated are not actually the worst offenders. These industries, most of which have a higher percentage of working women than men, would be the biggest offenders according to the 2022 Gender Pay Gap Report by Payscale:

The reason? According to a Pay Equity Strategist at Payscale, the gender pay gap in these industries can be attributed to lower representation of women in more senior, higher-paid roles as well as gender stereotypes around women’s proficiency in math and science.

What we can do

1. Trades employers and unions must prepare their workplaces to welcome women. From creating apprenticeship programs for women to offering flexible childcare options to even providing women with uniforms and safety gear that actually fit — all are great starting points to promote gender diversity in the trades sector.

2. It’s not always about paying equal salaries—reducing the gender pay gap also has a lot to do with increasing the representation of women at all levels, including more senior positions, as well as improving pay transparency to combat unconscious bias.

Raises and promotions—or lack thereof

Multiple resources cite raises and promotions as a contributor to the gender pay gap. Some sources state women are less likely to ask for raises, while others say women ask for raises the same amount as men, but emerge less successful.

In fact, the Harvard Business Review found women to experience a 15% success rate in asking for raises, while men had a 20% success rate. The difference between these two numbers can be attributed to, once again, double standards. Women are more likely to be viewed as “bossy,” “intimidating,” or “too aggressive” when seeking higher compensation.

What we can do

1. Women must feel empowered to negotiate their compensation or ask for raises without fear of coming off as “too aggressive.” Experts recommend women research average salaries for their current position, and to save evidence of clients or coworkers praising their work to use as the basis for requesting a raise.

2. Remember that negotiating doesn’t end at the salary. If your employer is unable to reach your salary expectations—and even if they’re able to—inquire about a bonus or more vacation time.

Gender discrimination and unconscious bias

Overall, the problem of gender pay gap goes deeper than being just an economic issue—it’s a social issue that arises from the deep-rooted unequal distribution of responsibility and unconscious bias leading to systemic gender discrimination.

Unconscious bias occurs when a person believes a stereotype about a group of people, even without realizing it. It impacts all parts of our lives, including employment and compensation. The perception that women can’t handle the responsibility of a high-stress, senior position could also result in unconscious bias when hiring for executive positions.

What we can do

1. Demand transparency laws for pay. Canada’s recent requirement for public-sector salary disclosures was found to have decreased the gender pay gap at universities from 15% to 4%. This requirement also contributed to female professors getting more raises.

2. If you are an employer or manager, support and approve the discussion of salaries. In many workplace environments, employees refrain from speaking about their salaries for fear of reprisal from their employers. The ability to openly discuss compensation can bring awareness to any form of discrimination, be it conscious or unconscious.

3. Employers can also be transparent about salary ranges before hiring, and share pay information with their employees. Moreover, they can prioritize pay audits to reduce their gender pay gap, as done by companies like Salesforce and Intel.

Is there hope in closing this gap?

The awareness brought to the gender pay gap in the last few years has been a great step in helping to address it. With continued awareness and education, support for women to ask for more, balanced family responsibilities, removal of unconscious bias, greater pay transparency, and acceptance of women in trade roles, North America has a chance at closing the gender pay gap.