Despite progress in workplace equality, the gender pay gap remains a persistent issue in Australia.
While recent data shows the gap is narrowing, women still, on average, earn less than men, impacting their financial security, career progression, and retirement savings.
Understanding what drives the pay gap and how it’s calculated is essential for addressing this inequality.
This article explores the current state of the gender pay gap, its root causes, and what steps are being taken to close it.
What is the Gender Pay Gap?
The gender pay gap refers to the difference in average earnings between men and women across the workforce. It is not a measure of pay equity (which ensures equal pay for equal work) but rather reflects broader issues like industry distribution, career interruptions, and part-time work patterns.
According to the Workplace Gender Equality Agency (WGEA), Australia’s national gender pay gap currently stands at 12%, meaning that, on average, women earn 88 cents for every dollar earned by men.
The gender pay gap is calculated using full-time average weekly earnings and does not account for differences in roles, experience, or seniority.
Causes of the Gender Pay Gap
Career Breaks and Unpaid Care Work
Women are more likely than men to take career breaks for parental leave or caregiving responsibilities. This results in lower lifetime earnings, fewer promotions, and reduced superannuation savings. Even when women return to work, they often face challenges in regaining seniority or securing full-time positions.
Overrepresentation in Part-Time and Casual Work
Women are more likely to be employed in part-time or casual roles, which typically offer lower wages and fewer opportunities for advancement. The Workplace Gender Equality Agency reports that 44% of Australian women work part-time, compared to just 16% of men.
Industry and Occupational Segregation
Certain industries dominated by women, such as healthcare, education, and retail, tend to have lower average salaries than male-dominated fields like finance, construction, and technology. Even within the same industry, women are often concentrated in lower-paid roles.
Gender Bias in Promotions and Leadership
Despite making up nearly 50% of the workforce, women are significantly underrepresented in executive and leadership positions. This lack of representation contributes to a cycle where fewer women hold high-paying senior roles, widening the pay gap.
Differences in Salary Negotiation and Pay Increases
Studies suggest that women are less likely to negotiate salary increases compared to men, and when they do, they are often met with resistance. This contributes to slower income growth over time.
Recent Progress: The Gender Pay Gap is Narrowing
The gender pay gap in Australia recently dropped to a record low of 12%, down from 13.3% in 2023 (Prime Minister and Cabinet).
This improvement is largely due to:
- Stronger workplace gender reporting requirements.
- Government policies supporting parental leave and pay transparency.
- Increasing awareness and advocacy for pay equity.
However, as ACTU President Michele O’Neil points out, women still earn nearly $8,000 less per year than men on average, highlighting the need for continued action.
How the Gender Pay Gap Impacts Superannuation and Retirement
The gender pay gap doesn’t just affect women’s take-home pay—it has long-term financial consequences.
Lower lifetime earnings result in:
- Lower superannuation balances at retirement.
- Reduced ability to invest and build wealth.
- Greater financial insecurity later in life.
Women retire with, on average, 25% less superannuation than men, making financial planning essential.
At eairwoman, we help women bridge this gap by providing tools like our Superannuation Calculator, allowing you to see how career breaks, salary sacrifices, and voluntary contributions affect your retirement savings.
Take Charge of Your Financial Future Today
While Australia has made progress in narrowing the gender pay gap, there is still work to be done. Understanding the causes and long-term impacts of pay inequality is the first step toward change.
At eairwoman, we provide the tools and resources to help women take control of their finances—whether it’s tracking earnings, planning for career breaks, or securing retirement.
Download the eairwoman app today to take control of your financial future. For more insights and support, contact us.
Let’s work together to close the gap!