Financial services still failing to squash gender pay gap, study reveals

According to the latest data from the Workplace Gender Equality Agency (WGEA), the gender pay gap in the finance and insurance sector was second highest in the economy at 28.6 per cent in 2021–22, only behind the construction industry with 29 per cent.

WGEA’s ninth annual Gender Equality Scorecard revealed that the pay gap actually decreased by 1 per cent compared to the previous financial year, but it still largely exceeded the overall gender pay gap in Australia which stood at 22.8 per cent.

In fact, WGEA explained that industries with higher average earnings tended to have wide wage gaps compared to industries with lower average earnings. Namely, while men working in the finance and insurance sector made an average of $173,000, women earned just over $120,000.

Moreover, WGEA’s Gender Equality Scorecard revealed that men still continued to hold a larger share of managerial roles.

While the share of female workers in financial services and insurance stood at 53 per cent, the number of women in management positions across the industry stood at 42 per cent.

WGEA director Mary Wooldridge hoped that these findings serve as a “wake-up call” to employers.

“There is so much opportunity for improvement and now is the time to act to achieve a gender-equal experience in Australian workplaces,” Ms Wooldridge explained.

This year’s scorecard comes after WGEA’s Gender Equity Insights report released in October, which disclosed that the overall difference in total annual remuneration between men and women in Australia was $25,792 in 2020–21, with finance and insurance services contributing $2,500 to the figure.

The sector was responsible for 10 per cent of Australia’s overall gender pay gap, although these values varied between states — contributing 17 per cent to the pay gap in NSW, and comparatively 3 per cent in Western Australia.

Commenting on the findings, Ms Wooldridge said that Australia is “faced with a highly gender-segregated workforce in Australia”.

“Women and men are concentrated in different industries and occupations, and women are underrepresented in full-time employment and leadership positions,” she continued.

Furthermore, the report additionally revealed how gender pay gaps widen with age, but also found that the ‘age of divergence’ in average salaries between women and men varies depending on the industry.

Namely, the gender pay gap in financial and insurance services may emerge as early as the age of 20.

“Australian employers have a critical role to play in addressing gender segregation and promoting gender balance in the workforce,” Ms Wooldridge concluded.