Gender pay gap widens for financial services

While the overall gender wage gap has decreased slightly, the Financy Women’s Index (FWI) reveals the gap has widened for employees in the financial and insurance services sector.

Established in 2017, the FWI is a quarterly measurement of the economic progress of women and tracks the time frame to gender financial equality in Australia. At the time of its inception, the FWI reported it would take 37.5 years to close the gender pay gap.

According to the findings, it will now take Australia 21.5 years to close the gender pay gap at the current progress rate, down slightly from 21.7 years in the previous quarter.  

The national gender pay gap fell to 11.5 per cent, based on the Australian Bureau of Statistics’ full-time average weekly earnings. 

Based on these figures, 19 August, or Equal Pay Day, marks the 50 additional days women must work each year to earn the same as men.

With the full FWI report set to be released in September, an early look at its findings revealed that despite overall progress, the gap has actually widened in the financial and insurance services sector by 2.6 per cent over the last quarter to 21 per cent.

However, the health care and social assistance sector has the largest gap, sitting at 23 per cent.

The three primary drivers of the gender pay gap, as explained by the Workplace Gender Equality Agency (WGEA), are gender segregation of occupations and industries, unequal distribution of caring and family responsibilities, and discrimination in the workplace.

Speaking on the findings, FWI author and founder Bianca Hartge-Hazelman noted the deterioration in the financial and insurance services sector as a “major handbrake on our national progress”.

“It’s this poor performance in key sectors that ensures Equal Pay Day remains a frustrating fixture on our calendar. The full Financy Women’s Index will connect these dots, showing how these laggard industries impact the broader journey to financial equality for Australian women.”

Hartge-Hazelman explained that while the progress made already is important, there is still a long road ahead to rectify this.

“While it’s positive to see the number come down over the long term, it represents the median point in a much more complex journey. The fact that women have to work an extra 50 days into the new financial year just to catch up to men’s earnings is unacceptable, and our full report in September will explore the structural barriers holding us back despite record female workforce participation.”

AMP chief economist, Dr Shane Oliver, added: “We have made great progress towards equal pay for women, but we still have a long way to go and Equal Pay Day serves as a reminder of this.”