Close the Gap
Open up gender pay data
By Ania Calderon and Megan O’Donnell
Across all regions, women earn less than men due to factors reinforcing broader structures of gender inequality. This wage gap hinders economic development and is exacerbated for particular segments of women¹. The lack of transparency and patchiness of the information available on the gender pay gap across sectors and locations inhibits understanding of its causes and effects. Publishing and using accessible, comparable and timely data on various dimensions of the gender pay gap² would stimulate private and public sector efforts needed to close the gap.
Research shows how ‘gender pay gaps shrink when companies are required to disclose them’ and that this is beneficial for employers and employees³, helping improve business performance and employee satisfaction.
Yet accessing quality private and public sector gender-disaggregated pay data annually still remains a challenge.
Currently-available data on gender gaps in income primarily reflect disparities for countries as a whole, rather than within sectors or individual companies/organizations, which makes it difficult to hold particular actors to account and encourage change⁴. One approach to address this problem is to require employers to disclose information on the differences between what they pay their male and female employees and encourage data-informed actions to help close the gap.
To date, at least ten countries have some sort of gender pay transparency regulation in place. Some companies, like CitiGroup and Salesforce, are going even further, disclosing pay differences between gender and race — as well as sharing measures they will take towards achieving pay equality. In 2018, the UK government mandated gender pay reporting from companies with at least 250 staff. The data released was the most comprehensive account ever collected in any country and prompted scrutiny of those worst-performing. It highlighted a number of explanations behind the gap and suggested actions to help close it.
However, there has been criticism of the quality of data and unsatisfactory level of granularity which might limit its value. We need to be able to observe the occurrence of the wage gap across other factors, (for example how the gap plays out for women with different educational levels, race, ages, part-time employment or who work in different fields) to be able to address the underlying drivers of the gap. Even though the principle of equal pay for equal value is addressed as part of the Sustainable Development Goals under Goal 8 (“Decent Work and Economic Growth,”) there are no internationally-recognised standards for measuring the gender pay gap.
This slows our speed of progress in promoting gender equality in the workforce, and leaves particular groups of workers especially vulnerable, and even invisible in published statistics (e.g., part-time workers, who are disproportionately women).
Finally, we are even farther still from understanding gaps in income between men and women who work in the informal economy (and who constitute the majority of workers in developing country contexts). While we work to use data and evidence to encourage private sector companies and organizations in the formal economy to improve pay transparency and equality, we must also investigate how we can gain more insight into gender gaps in income for more vulnerable demographics, and pose recommendations for how to collect necessary data on these populations going forward.
With gender equality legislation in the pipeline of various governments and increasing evidence on the correlation between equitable firms and financial performance, as well as increased attention on the links between women’s economic empowerment and the achievement of the SDGs, this International Women’s Day is an opportune time to call for a better understanding of how to open and use gender pay data as part of efforts to narrow gender gaps.
Building on lessons from gender pay gap reporting and as part of our “Bringing power into the open” strategy, the Open Data Charter is partnering with ONE Campaign to convene feminist experts, data users, companies and government officials to explore what an inclusive global gender pay data standard should look like, alongside specific measures to help achieve a fair economy.
If you would like to join these conversations, send us an email to info@opendatacharter.org.
[1]: For instance, based on their age, marital and parental status, geographic location, and informal sector involvement
[2]: Types of datasets may include aggregate pay data broken down by profession, gender, role, age, educational levels, dependants, working hours and hourly rates, as well as broader data on labour market participation progress performance and “non-traditional” data sources (e.g., household surveys; time use surveys).
[3]:A study on pay transparency in Demark found that the gender pay gap declines by approximately two percentage when firms are required to provide gender dis-aggregated wage statistics.
[4]: See ILO, WEF and OECD examples
This thinking has been informed by exchanges with several gender equality advocates who we thank, including Natalaia Domagala and Ana Brandusescu.
