Where’s the Gap? Follow-up post

A friend read my previous post and made some comments to me, and I thought it might be a good idea to address them in a follow up post.

Why the bit about HECs debt and super?

The HECs debt is rising, and there is little chance of government recovering all of this debt. A recent Grattan report suggested lowering the repayment thresholds in order to increase the number of people repaying their HECs debt by nearly 50%. Future policies in this space will probably focus on how to get this debt repaid.

More than half of tertiary graduates are females, we can make a crude but reasonable extrapolation that more females than males will shoulder HECs debts. Because of the gender pay gap, females are more likely to take longer to pay off their debts, or indeed, fail to pay all of it. This means the cost will fall to taxpayers.

The situation with super is similar. Australia has an ageing population, and there are more females than males in higher age groups (e.g. over 60 yrs), this means that over time, we will get more and more elderly females living off their super.

Because of the gender pay gap, these women have probably accumulated less super then men, and will therefore rely on welfare benefits to meet the gap between their living needs and their super payout. The cost of providing welfare will also fall to taxpayers.

The impetus for providing these arguments is to say that in addition to equal pay being a good thing in principle, there are also economic incentives to eliminate this pay gap. Making sure there is equal pay benefits us all. My primary argument is still that equal pay is something that we should strive for on principle, but for those skeptics out there who think the pay gap is just the result of women making poor life decisions (and therefore why should we help?) these arguments show that the gender pay gap can affect everyone, and that more equal pay benefits us all.

Should we be aiming at gender-neutral policies?

My friend mentioned that parental leave policies should aim to be gender neutral, and that in fact this whole debate about the gender pay gap should be discussed on gender neutral terms. It’s about empowering both sexes to do things outside of their traditional gender roles, which will help address the differences between male and female working hours, and therefore level their pay.

However, I believe that the time has passed for entirely gender-neutral policies, at least for parental leave schemes anyway. We are at a point where the norm is still stacked against the female. The norm is that the mum stays home to look after the kids while the dad works. To proactively combat that norm, we need policies in place that still allow mothers to take time off work to look after children, but also does more to encourage fathers to take leave. For example, a period of parental leave that can be taken by either parent, and an additional, say, 2 month period that is reserved for the father on a take it or lose it basis.


Where’s the Gap?

A feminist bake sale at University of Queensland proposed to sell goods at prices proportionate to the gender pay gap. For example, a man would pay $1 for a cookie, but a woman would pay $0.7. The organisers of the bake sale have been subject to threats of rape and violence as a result.

Gender pay gap is an issue that I’ve struggled to reach a position on because I’ve realised it’s not a black and white problem. I used to be frustrated when I raised the gender pay gap with male friends and they would remark that it was because women give birth to children and take maternity leave, so of course there’s gap, because they simply work less. I think that’s an unsatisfying explanation to the problem, and I also think women shouldn’t be singularly penalised for giving birth to not just their own, but also their partner’s child.

But back to that issue later. Where does the gender pay gap exist? Why does it exist? And is it fair to say that it shouldn’t exist when the factors underlying the difference in pay has nothing to do with gender discrimination?

Should a garbage collector complain about the pay gap between garbage collectors and doctors? Can a person without a university qualification mount a legitimate argument for why they should be paid just as much as someone who did go to university? Education, career choice, amount of time spent working, are all factors that can contribute to a difference in pay. What causes the gender pay gap? And is it purely due to gender? I believe that pay discrimination purely based on gender is wrong. But if say, a nurse is paid less than a doctor, then I see nothing wrong in that. The issue of course, is that there are more female nurses than male nurses, and there are more male doctors than female doctors, which means that when aggregated, females in the health sector earn less than men.

For example, ABC Factcheck found that in law, the median salary for female graduates is $62,000. For male graduates it’s $70,000. That’s semi-useful, because it removes the effect of maternity leave since graduates aren’t usually at that stage of their life yet. However what the industry break down? Are women earning less because more women work in the community legal sector while more men work in corporate law firms?

While it’s important to raise awareness of the pay gap, I think in general that a sufficient level of social awareness has been reached. I think we need to move on to the next step of how to close the gap. I think it’s unproductive to focus on the overall statistic that on average, women earn less than men, because that puts too much focus on the gender, and I don’t think gender is the real cause of the gap (though I stand to be corrected), the real cause are factors such as career choice, parental leave and so forth. These issues need to be solved by policies targeting the specific factors.

The pay gap should not be solved by individual women in more privileged jobs advocating for a higher salary, leaning in to their job, and trying to take as little parental leave as possible. Cheryl Sandberg’s solution completely disregards large segments of female employees such as nurses and teachers, whose pay is determined by enterprise bargaining agreements, not by how much they lean in. Unfortunately, Cheryl’s advice does not give a comprehensive solution to the problem, and what’s more, puts the entire onus on women.

We need policies that focus on increasing female workforce participation, and to open up women to more career opportunities by, for example, making sure that throughout their education they are engaged with STEM subjects. This doesn’t just go one way. In order to increase female workforce participation, we need to encourage men to take time off work. A father taking paternity leave, for example, should be just as normal as a mother taking maternity leave. Dads shouldn’t have to face any stigma for doing so. In addition, men should also be encouraged to consider jobs that tend to require care and compassion, without copping flak about being sissy or girly.

There are also economic incentives for making sure women have the freedom to work more, and their partners consequently, being able to take time off work to look after the family. As Annabel Crabb points out, more women than men hold tertiary qualifications. We can make a crude extrapolation that more females than males therefore have student debt. Tertiary debt is currently ballooning and it is in the taxpayer’s interest that student debts are paid off. But if women are earning and working less than men, then a large proportion of student debt will take a long time to be paid back, or not paid at all.

In addition, there are more females in the higher age brackets, and therefore possibly more females now living off their super (another crude conclusion), but how can we decrease their demand on the public welfare system when women in general accrue less super over their lifetime because of the pay gap, and we lack the policies to empower women to participate more in the workforce, and in sectors where people are paid more?

Personally, I like the idea of reforming how paternal leave is used in Australia, and to make sure that more men are using it. That would be my starting point for addressing the gender pay gap.