The gender pay gap in the Public Service has continued to decrease. As at 30 June 2019, the average salary was $86,900 for men and $77,700 for women, up 3.3% for men since 30 June 2018 and up 5.1% for women. This means the gender pay gap decreased by 1.7 percentage points to 10.5%. This is the lowest gender pay gap in the Public Service since measurement began in 2000, and, the largest annual decrease since 2002 (when it also decreased by 1.7 percentage points).
The following factors have driven the substantial fall in the gender pay gap over the past year:
- There have been two pay equity settlements that affect relatively large Public Service workforces, social workers at Oranga Tamariki and Ministry of Education support workers (who support children in early childhood and primary schools with learning and behavioural challenges). These workforces are female dominated.
- As part of the Public Service’s commitment to the Gender Pay Gap Action Plan, departments have been:
- steadily increasing the number of women in senior leadership roles. This is shown both by the record high female share of senior leaders (49.6%), and the fall in the gender pay gap for senior leaders (down from 7.4% in 2018 to 4.7% in 2019). At the chief executive level, female chief executives are now leading larger organisations than previously
- reviewing the salaries of their employees in the same or similar roles to ensure that an employee’s gender is not adversely affecting their salaries. This has resulted in salary corrections for some employees, with more women than men overall needing salary corrections.
- In the last year pay adjustments were made to ensure all Public Service employees were receiving the 2018 Living Wage. In addition, the Government Expectations on State Sector Employment Relations include an expectation that agencies will reduce the gap between their highest and lowest earners. Some agencies have responded to this by lifting the salaries of their lowest paid employees, who are more likely to be women.
Analysis of the HRC data has generated the following insights:
- Gender pay gaps tend to increase with age. There is a particular jump between the gender pay gap for the 40 to 44-year age group (8.1% in 2019) and the 45 to 49-year age group (14.0%). A key driver for this is that women aged 40-44 years in 2019 are more likely to hold senior managerial roles than in the past.
- Gender pay gaps vary greatly among departments, ranging from 32.8% in the Ministry of Defence to -2.2% in Oranga Tamariki (a negative gender pay gap means women were paid more than men). The Ministry of Defence’s gender pay gap has been decreasing substantially in recent years (it was 45.4% in 2016).
- Differences in the gender pay gap across departments are generally driven by the extent to which departments have gender imbalances in their workforces. For example, some traditionally male fields (such as IT or procurement) tend to be highly-paid whereas lower paid clerical and contact centre roles tend to be female dominated. This occupational segregation - women being more likely to be working in lower-paid occupations - is a key driver of the gender pay gap for many departments.
- Even within the same occupational groups there are compositional differences between the genders in terms of seniority and experience. For example, women make up 54.8% of all managers in the Public Service in 2019, but only 49.6% of senior managers (although this is up from 37.8% in 2009).
- We estimate that differences in occupational group, seniority and experience (through age) between men and women explains around 59% of the overall gender pay gap of 10.5%. While data analysis can help to highlight some of the factors that contribute to pay gaps, it does not negate them as factors that need to be addressed in order to reduce the gender pay gap further.