Gender wage gap narrowing in Canada

The gender wage gap in Canada has narrowed in recent years but it continues to be significant, according to a report released on Monday by Statistics Canada.

In 2018, female employees aged 25 to 54 earned $4.13 (or 13.3 per cent) less per hour, on average, than their male counterparts. In other words, these women earned $0.87 for every $1 earned by men, said the federal agency.

The report also found that:

  • The gender gap in hourly wages has narrowed by $1.04 (or 5.5 percentage points) since 1998, when it was $5.17 (or 18.8 per cent).
  • The reduction in the gender wage gap between 1998 and 2018 was largely explained by changes in the distribution of men and women across occupations; women’s increased educational attainment; and the decline in the share of men in unionized employment.
  • The two largest factors explaining the remaining gender wage gap in 2018 were the distribution of women and men across industries, and women’s overrepresentation in part-time work. These were also the largest explanatory factors behind the gap in 1998.
  • Similar to other studies, nearly two-thirds of the gap in 2018 was unexplained. Possible explanations for this portion include gender differences in characteristics that were beyond the scope of this study, such as work experience, as well as unobservable factors, such as any gender-related biases.

The report said women in the core working ages of 25 to 54 earned an average of $26.92 per hour in 2018, while their male counterparts earned $31.05

“Real wages (adjusted for inflation) grew faster for women aged 25 to 54 than for men in this age group between 1998 and 2018. … Specifically, women’s average real hourly wages increased by 20.5 per cent over the period, while men’s increased by 12.9 per cent. As a result, the gender wage gap decreased by 5.5 percentage points, from 18.8 per cent in 1998 to 13.3 per cent in 2018,” it said.

“The decrease in the wage gap occurred in a somewhat step-wise manner over the period, with sharper declines observed during the early 2000s and around the 2008-2009 recession. … Both of these decreases reflect periods of stagnant or declining wages among men, rather than notable increases in women’s wages.

“Between 1998 and 2018, the occupational distribution of men and women explained just over a quarter (26.3 per cent) of the reduction in the gender wage gap. Notable narrowing effects came from professional occupations in law and social, community and government services (8.5 per cent), professional occupations in education services (7.7 per cent) and professional occupations in business and finance (7.2 per cent). These three higher-paying occupational groups employed a larger share of core-aged women in 2018 than in 1998. Also, earnings grew faster for women than men in two of the three groups (professional occupations in law and social, community and government services and professional occupations in business and finance).”

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