26 April 2010 The unadjusted gender pay gap in the EU Didier Dupré, Eurostat unit F2 UNECE Work Session on Gender Statistics SESSION I: Gender differences in economic security Sub-session A. Gender Pay Gap

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 2 Inequality in pay between men and women remains high in EU 05/03/2010 (Women’s Charter): the European Commission announced its goal of significantly reducing the pay gap between men and women over the next five years In the EU the unadjusted Gender Pay Gap (GPG) is: –A key indicator in the framework of the Commission Strategy for equality between women and men –A European Structural Indicator (Lisbon strategy) –A Sustainable Development Indicator (SD Strategy)  Defined at macro level for monitoring policies The Framework

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 3 Agreed with DG EMPL and the NSIs - the GPG is: –Unadjusted (no consensus / scientific evidence on adjustment method) –Calculated using average gross hourly earnings: Hourly earnings: eliminates effects of differences in use of part time work, includes paid overtime (but excludes non-regular payments) Average: arithmetic mean –Based on the EU harmonised four-yearly Structure of Earnings Survey (SES) + national estimates for the years between the SES benchmark years - NACE Rev 2 B to S excluding O, enterprises  10 employees average gross hourly earnings of male paid employees   average gross hourly earnings of female paid employees GPG (%) = average gross hourly earnings of male paid employees The Definition

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 4 The unadjusted GPG, whole economy*, 2008, % * NACE Rev 2 B to S excluding O

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 5 The non-adjustment effect (1) Country « X »Average gross hourly earnings € GPG % Share of total employment % MenWomenMenWomen Industry, energy, construction Trade, transport, business, finance Education, health, social, personal services  Whole economy (NACE Rev 2 B to S excluding O)

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 6 The non-adjustment effect (2), 2008

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 7 GPG by educational attainment, 2006

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 8 GPG by age groups, 2006

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 9 Detailed breakdowns from SES: GPG calculator (*) (*) Other characteristics required: sector of economy, occupation, size enterprise

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 10

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 11 Controlling for observable characteristics (in the SES) of workers and enterprises can provide a first indication of the contributions from different factors to the size of the GPG and of elements for possible adjustments Self-selection effects (i.e. when only those women that can expect high earnings participate in the labour market) can be also modelled based on observable variables (in the SES)  Study on the "Development of econometric methods to evaluate the Gender pay gap using Structure of Earnings Survey data" launched by Eurostat in 2008 (Maastricht University) However, any survey provides only a limited number of observable variables and an adjusted GPG would not provide a fully comparable measure Towards an adjusted GPG ?

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 12 Some results from the 2008 econometric study (%) Raw (*) GPGOLS (**) GPGOLS (**) + self-selection (***) GPG DK21.3 (17.1) DE27.0 (23.2) IE17.8 (17.1) EL21.7 (22.0) ES18.4 (17.1) IT4.3 ( 4.9) NL23.4 (23.6) AT26.9 (25.5) PT8.1 ( 9.2) FI21.6 (20.0) UK25.3 (21.4) (*) Unadjusted and from SES but using slightly different calculations as the (Eurostat unadjusted GPG) (**) Based on age, education, occupation, FT/PT, term of contract, private/public and size enterprise (**) Based on age, education, gender and its interactions with the 2 other variables

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 13 Complementary analysis: dispersion, e.g., low wage earners* * full-time employees having annual gross earnings lower than two thirds of the annual full-time median gross earnings

26 April 2010Eurostat – The unadjusted Gender Pay Gap in the European Union 14 Concept of equal pay for equal work: mainly at micro level Adjusted GPG: would not provide a fully comparable measure How to progress ? –Supplementary indicator to the unadjusted GPG: measuring an unadjusted gender pay gap using the median instead of the mean –Complementary analysis: e.g., wage dispersion –Further developments: access for researchers to the SES microdata in the Eurostat Safe Centre and to the SES anonymised microdata (CD-Rom) Conclusions: How to improve the pay gap analysis / monitoring ?