Gender wage gap narrows to 13.3%, women earn $4.13/hour less
Statistics Canada says changes in distribution of men and women in occupations was key to the smaller wage gap.
OTTAWA — Women in their core working years earned 87 cents per hour on average for every dollar earned by a man in 2018, according to a new report by Statistics Canada, marking a 5.5 percentage point improvement over the past two decades.
In 2018, female employees between the ages of 25 to 54 earned on average $26.92 per hour – $4.13 or 13.3% less than the $31.05 in hourly wages for male employees, according to the research paper released Monday.
Hourly compensation for women has improved since 1998 when the agency’s data showed female employees earned $22.34 per hour. That was $5.17 or 18.8% less per hour than males – or 81.2 cents for every dollar.
“The gender wage gap has narrowed over time, both in Canada and elsewhere,” the researchers said in the report.
“However, given that women in Canada have surpassed men in educational attainment, diversified their fields of study at post-secondary institutions, and increased their representation in higher-status occupations, the persistence of gender-based wage inequality warrants continued attention.”
While it is positive that the differential has narrowed to 13.3%, most of the catch-up happened in the first decade of that 20 year period, said Sarah Kaplan, director of the Institute for Gender and the Economy at the University of Toronto’s Rotman School of Management.
“We, along with a lot of the other developed economies, seem to be stuck right around that number and have had a hard time moving beyond it,” she said in an interview.
Of the $4.13 pay gap between the genders, researchers concluded that $1.85 stemmed from the different distributions of males and females across industries and occupations. For example, more men worked in higher-paying sectors and occupations such as construction, manufacturing, mining, quarrying, and oil and gas extraction, as well as in professional occupations in natural and applied sciences.
Changes in the distribution of men and women in different occupations was key to shrinking the wage gap in 2018, said the report’s authors, Rachelle Pelletier and Martha Patterson of Statistics Canada’s Centre for Labour Market Information, and Melissa Moyser of the agency’s Centre for Gender, Diversity and Inclusion.
Notably in 2018, a larger share of core-aged women were working in professional occupations in the three areas of law and social, community and government services; education services; and business and finance, than in 1998, the researchers said.
The report notes earnings also grew faster for women than men in two of those groups: professional occupations in law and social, and community and government services, as well as those in business and finance.
However, the distribution of women and men in different industries actually widened the gap, driven by the “high-paying and male-dominated construction sector,” where employment increased over the 20-year period. The decline of employment in manufacturing counteracted this effect, with the percentage of core-aged men employed in this sector falling to 15.5% in 2018 from 25.2% in 1998, the researchers added.
An increase in women’s educational attainment was the second-most important determinant in the decreased wage gap, researchers said. In 1998, there were equivalent proportions of women and men who held a university degree at the bachelor level or above at 21.6% and 21.5% respectively. But in the following 20 years, the proportion of women with at least a bachelor’s degree increased by 19.6 percentage points to 41.2%, while men saw a 10.8 percentage point increase to 32.3%.
“As workers with higher education earned more on average, the relative increase in women’s educational attainment accounted for 12.7% of the decrease in the gender wage gap that occurred over the period,” the report said.
Men’s decreased union coverage – which is typically associated with higher average wages – also contributed.
The proportion of men covered by a union or collective agreement fell by 8.6 percentage points from 38.2% in 1998 to 29.5% in 2018. But the equivalent proportion for women held steady at a little less than 36%.
“These differing trends largely reflected the fact that men with union coverage were concentrated in manufacturing – a declining sector through the first half of the period – whereas women in unionized jobs have been concentrated in health care and social assistance, and educational services,” the report said.
Another contributing element was women’s higher rate of part-time work, which accounted for approximately 38 cents of the hourly pay gap, researchers concluded. The proportion of women working part-time – which generally has lower compensation than full-time work – amounted to 16%, compared to 4.8% of men, the researchers said.
Kaplan said women continue to be pushed into part-time work or industry sectors or roles that are more family-friendly, given the workload often associated with being the primary caregiver at home.
“Until we either get a lot more supports such as universal child care that’s affordable or men sharing equally in the care responsibilities, I don’t think we’re going to move beyond this,” she said.
Progress on closing the wage gap “feels very slow,” given that women have earned 58% of all university degrees in Canada for more than 25 years, said Tanya van Biesen, executive director for Catalyst Canada, whose mission is advancing women’s progress in the workplace.
She doesn’t expect to attain 50-50 representation in every industry or role, but the many women who are studying to enter construction, mining and other lucrative sectors and occupations continue to face systematic barriers, van Biesen said.
“Once they get into those sectors they feel alienated because of the bias that exists within those workplaces,” said van Biesen. “That’s still a very, very real factor for women who have just as many aspirations as men.”