A new report finds only a small percentage of pay gaps for Pasifika can be explained by the jobs they do – three-quarters is caused by unconscious bias, discrimination and other such factors
Opinion: Oaxaca-Blinder sounds as if it should be a tequila-based cocktail. Alas, it’s a statistical ‘decomposition’ technique.
A useful one though. It can work out how much of pay gaps can be explained by observable characteristics and how much can’t be.
It's core to the analysis of a report released by the New Zealand Human Rights Commission last week. Its inquiry into Pacific pay gaps wanted to know what was driving the gaps for Pasifika workers.
A great question considering Pasifika women earn $0.75 to a Pākehā man’s $1.00.
What the analysis finds is that only a small percentage of pay gaps for Pasifika men and women can be explained by the jobs they do. The industry and occupation Pasifika men work in or their highest educational qualification accounts for only 27 percent of their pay gap.
The remaining 73 percent can only be explained by things that can’t be observed – unconscious bias and discrimination and other such factors.
The same researchers gave Aotearoa New Zealand’s gender pay gap the same statistical workover a few years back and found similar results. Eighty percent of the gender pay gap couldn’t be explained.
A few decades ago, we may have been able to justify pay gaps because Pasifika or women workers were less well educated, less experienced, and were choosing part-time or low-skilled jobs.
This analysis is saying the characteristics of individual workers and their job choices are not the sole reason there are pay gaps.
Managers and directors: look at your pay gaps. Hold yourself accountable and publish them and your plans to fix them so potential employees, investors and customers can see what role you may be taking in eradicating pay gaps.
It’s also about how groups of workers are treated in the workplace. That’s an uncomfortable finding, especially if you are a manager. Who you chose to hire, promote, give overtime to, and see leadership potential in (or not) is part of our pay gap problem.
Especially if you are a woman, Māori, or Pasifika, or ethnic-minority employee, because the research also shows no matter how hard you study and work, and focus on making the best career choices, systematically things are likely to happen in your workplace that mean you will be paid less.
Very few leaders (hopefully none) set out to discriminate or pay unfairly based on gender or race. Yet the data shows it happens. And many workers and their families are out of pocket as a result.
Let’s just stop it.
Managers and directors: look at your pay gaps. Hold yourself accountable and publish them and your plans to fix them so potential employees, investors and customers can see what role you may be taking in eradicating pay gaps.
Employees: let’s ask for pay gap data. Ask when you apply for a new role.
All of us: ask the businesses we interact with for their pay gap data. We can sleep better knowing we are buying from or investing in businesses that treat their employees fairly.
The Minister for Women, Minister for Pacific Peoples, Minister for Ethnic Communities and Minister for Māori Development: please announce compulsory pay gap reporting and level up our workplaces.
I call ‘time's up’ on this pay gap crap.
