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If New Zealand’s gender pay gap continues to close at its current rate, it will be almost 100 years after the passing of the Equal Pay Act before women are paid the same as men.
The Council of Trade Unions each year calculates the date that women start working for “free”, because of the difference in their wages compared to what men earn.
For all women, compared to all men, that date is 28 November.
But compared to Pākehā men, Pasifika women start working for free from Friday. Asian women hit the “free” date on 21 October.
The gender pay gap currently sits at 8.9 percent. It is down from 14.9 percent in 2008 but increased for a period during the pandemic.
Council of Trade Unions policy director and economist Craig Renney said the gap could be caused by direct discrimination – such as when women were paid less than men for the same job, or overlooked for promotion because of their gender.
There could also be indirect discrimination when female-dominated industries were valued less highly and paid less.
Based on current trends, the gender pay gap could be expected to close in 2068. The Equal Pay Act was passed in 1972.
A woman starting work this year aged 18 would need to wait until she was 49 to see pay parity across the economy, Renney said.
Rachel Mackintosh, the assistant national secretary at the union E Tū, said progress was happening at a “glacial” pace.
“There is very slow progress and at current rates it will take 95 years since the Equal Pay Act for the pay gap to be closed, which is pretty outrageous.”
She said people should consider the wider effects of women being paid less.
“Children are in poverty, there are ripple effects of that through people’s whole lives. If you’ve got that in mind, it’s much more motivating to do something about it … Whole sectors are undervalued because they are female-dominated.”
“It’s human lives we are talking about, it’s not just the physical, practical things like having enough money to live on … it’s also the psychological effect of having the whole of society telling you that what you do is not as valuable as what someone else does, even if they’re doing the same thing.”
Renney said there was a risk the current economic environment could set progress back.
“A downturn in the economy and rising unemployment will compound this issue. Unemployment for women during previous recessions has increased more quickly than for men.”
Targeted job losses in the public sector (where female employment was higher) would also mean that female wage bargaining power declined.
“This is a recipe for a continuing gender pay gap.”
He said there was also an element of wage scarring affecting some women.
“Where women have caring responsibilities, or maybe they have taken time off to have children, they can find their career projection is altered as a consequence.”
He said it might help to improve paid parental leave and make sure men had the opportunity to take it, and to improve the affordability and availability of early childhood education services.
“And we can make sure that we’re valuing work equally where it has the same qualifications and experience and we don’t systematically under-pay groups just because they happen to be female-dominated… we probably should have cracked this by now.”
Renney also calculated the combined cost to women of not having pay equality as $7.2 billion a year.
“That’s the first round effect, it doesn’t include KiwiSaver, doesn’t include savings and interest, doesn’t include the fact they might have higher debt, financial security – there is a huge range of additional costs as a consequence.”
He said there were also more women earning the minimum wage, so they were more affected if increases did not keep up with inflation.
Mackintosh said improved pay transparency would also help. When pay was kept secret, it was more likely to exacerbate the gap, she said.
Mackintosh and Renney said actions such as the repeal of Fair Pay Agreements and the disestablishment of the pay equity taskforce were a problem.