Occupational choices between men, women also have impact
The within-job gender pay gap makes up 80% of gender wage inequality across Australia, according to a new study.
The research, carried out by E61 Institute, sought to unpack Australia's gender wage gap and find out the factors driving this. It found that much of Australia's gender wage gap in hourly wages is driven occupations.
"But what drives these differences in pay? Do men have characteristics that make them warrant higher pay compared to women in identical occupations? The answer is no," the report said.
It pointed out that different Australian Tertiary Admission Rank (ATAR) scores, job tenure, full-time status, and other personal characteristics did not narrow the gap.
It outlined two potential explanations, namely workers' characteristics not captured in researchers' data and economic returns on the same characteristics might be vary by gender.
"For example, men and women might share similar traits, such as having two children and a high ATAR score, but these factors might affect their salaries differently," the report read.
"Being married and having children negatively affects the hourly gap within occupations for women but not for men."
Meanwhile, employees' occupational choices, where men and women diverge in their career paths, has also been identified as a driver of the gender pay gap, but only for 20%.
According to the report, men and women might choose different jobs because they bring different skills to the table.
"Even if so much of the gender wage gap cannot be attributed to differences in occupations, or other commonly observed characteristics, it does not necessarily mean that we shouldn’t encourage women to enter lucrative fields like STEM or finance. But there are no guarantees this will fully close the gender pay gap," the report read.
It underscored that a "broad suite of policies" will be needed to close the gap.
"The greatest opportunities for pay convergence lie in targeting the differences in pay between men and women of the same occupation," it said.
