Gender pay gaps, pay transparency, economic outlook
Trusted advisor in remuneration Strategic Pay is celebrating its 30th anniversary this year, marking three decades of remuneration support and research, which has served as a historical yardstick for progress.
To mark this milestone, Strategic Pay has looked into the archives to determine what has (and hasn’t) changed about working in New Zealand over those three decades.
Gender pay gaps and representation still a work in progress
Back in 1991, chairs were still referred to as chairmen in PriceWaterHouseCoopers 1991 edition of the Directors Fees Survey (which is now owned & run by Strategic Pay). Gender differences only began to be tracked and analysed in 2013, with the wording also changing to chairs.
Since gender reporting began, female representation at an executive level has almost doubled. Strategic Pay’s 2024 Directors Fees Report found that back in 2014, only 14% of chairs, and 24% of directors were female; however, 2024 results now show that 27% of chairs and 42% of directors are female. The report also revealed further increase in representation, with female representation in Non-Executive Chair roles also growing to 27% (up from 25% in 2023).
However, looking at median fee levels for male and females at the Non-Executive Director level, there has only been a marginal difference in the pay gap from 20% in 2023 down to 19.6% in 2024.
Strategic Pay’s research in recent years suggests that a fundamental problem underlying the gender pay gap in New Zealand is that women are not well represented in the higher paying sectors and roles, such as Chief and Senior Executives. The 2024 Directors Fees report found that female board members are most prevalent in central government (52%) and education (48%), and that women are less likely to be included on boards found in the wholesale/import/export (24%) and information technology (25%) industries.
Managing Director Cathy Hendry says, “more equitable representation in senior and higher paid roles enables diversity at critical levels in an organisation. These new voices bring other perspectives that will contribute to debate, resulting in a fully considered output which has been proven to increase productivity and innovation. The result is not only an effective organisation but also a desirable place to work.”
On top of this, Hendry notes the importance of addressing both vertical and horizontal segregation, with more encouragement for women into higher-paying sectors.
“Addressing gender equality is more than just reducing the overall gender pay gap, equality should be present in terms of representation, career progression, and access to development opportunities,” she says.
Continued question mark on the future of pay transparency
With mandatory pay gap reporting no longer progressing under the new government, and the Pay Equity Task Force that works for equal pay for women set to be disestablished, Strategic Pay says it's up to individual organisations to take accountability.
In a pulse survey conducted in May 2024, 345 respondents answered where their business is on their pay transparency journey: Only 3 organisations provided full access to pay rates, with the majority (137) providing minimal / very little transparency. 37 respondents said they provide no transparency at all.
Strategic Pay Chair, John McGill, has said, “there is no doubt that NZ is behind the ball compared to other countries when it comes to pay transparency, and I believe that forbidding employees to discuss their pay with each other is futile.”
“Social media especially has accelerated the use and spread of information. A single disgruntled employee is now able to tell the world what they think rather than the narrow circle that they had 30 years ago. Great systems are out there and it's our view that we should use them and embrace greater transparency before the inevitable train wreck engulfs us.”
To help address these issues, Strategic Pay has actively supported Kiwi businesses in their efforts to improve pay equity, with resources such as its free Gender and Ethnic Pay Gap tool, a public pay gap registry in partnership with MindTheGap, as well as producing a free pay equity booklet every two years.
Echoes of the Global Financial Crisis*
With Aotearoa now in an official recession, Strategic Pay read back over its executive summaries from Remuneration Reports in 2009 and 2010 when the country was in the grips of the recession, to compare and contrast with what’s currently happening.
In 2009, Strategic Pay referenced the NZIER economic outlook which commented that business confidence was the lowest it had been in 4 decades. One-third of all businesses in New Zealand were expecting to lay off staff. This resulted in unemployment reaching 7% in 2010.
According to NZIER’s March 2024 Quarterly Survey of Business Opinion, a Net 24% of businesses are expecting a deterioration in economic conditions and many businesses have indicated they are planning to reduce headcount in 2024.
This ties in with a pulse survey conducted by Strategic Pay in March, which found that 16% of organisations were planning to reduce staff this year. This survey was run before the most recent announcements from the public sector regarding job cuts, and this figure is expected to increase further.
*(All information referenced in this segment is taken from Strategic Pay’s March 2024 NZ Remuneration Report)
The future of the workplace
It's undeniable that Covid had a massive effect on the workplace, with flexible working becoming a massive buzzword ever since. McGill comments on this change, saying “flexibility in hours and where employees work has been a major and very significant change from pre-pandemic. Technology advances have made it very easy and the rise in “Digital Nomad” type roles has increased enormously.”
In a Pulse Survey from July 2023, Strategic Pay took a look at businesses' attitudes towards flexible working practices. More than half of organisations (53%) were looking to increase offering, while over a quarter (27%) were looking to reduce their offering. Only 3% of organisations planned to reduce their offering completely.
Comparing these findings with its Policies & Practices reports from 2012 - 2022, Strategic Pay found that between 2012 - 2022 the availability of flexible hours & work from home has increased, but part-time work and job sharing has decreased.
Adding to these findings, McGill says “it's important to note that flexible working does not suit every organisation. For example the introduction of a four-day week (much heralded) by Unilever in NZ did not extend to factory staff. Smaller organisations have often found flexible working easier to introduce, but larger organisations struggle to maintain organisation cohesion and have serious concerns around abuses. While the dust is still settling on this one, there's no denying there has been a seismic change, particularly when it comes to working from home.”
For more information, or to organise an interview, please contact: Elysha Taylor: Senior Account Manager, One Plus One Communications: +61 422 396 242 or
Rosalie Basham: Account Manager, One Plus One Communications: 021 029 48033.
Strategic Pay provides job evaluation and remuneration services and helps improve a company’s overall performance in the areas of employee effort, remuneration and rewards. Their services ensure that employee performance is aligned with a company’s business objectives. Strategic Pay provides propositions that will attract, retain and motivate the best employees.