What is the Gender Pay Gap?

The gender pay gap represents the difference in average earnings between individuals based on gender. This gap serves as a significant indicator of gender inequities prevalent across various industries and professional levels. Regardless of the measurement method, the gender pay gap persists and is more severe for those facing multiple barriers, such as racialized women, Indigenous women, and women with disabilities. This disparity begins at a young age and extends into senior years, highlighting its pervasive nature (Moyser, Statistics Canada, 2019).

Why is Pay Equity Crucial?

Earnings are a vital determinant of economic well-being in Canada. The gender pay gap symbolizes gender-based discrimination and injustice, according to Moyser (Statistics Canada, 2019). The UN’s Human Rights Committee (2015) has expressed concerns about the persistent inequalities between women and men in Canada, especially the high pay gap that disproportionately affects low-income women, racialized women, and Indigenous women.

The gender pay gap is linked to other economic-related gender gaps, such as fields of study and work, career advancement opportunities, and the distribution of unpaid care and domestic work (OECD, 2012). For full-time employees, there is a 17.1% difference between the annual median earnings of women and men relative to the annual median earnings of men. For self-employed individuals, the gap widens to 28%. Canada ranks as the seventh worst among OECD countries for the gender pay gap in full-time employees (OECD, 2024).

Defining the Gender Pay Gap

According to Statistics Canada (2019), the gender pay gap can be calculated by comparing average annual earnings, full-time and full-year average annual earnings, or hourly wages. The Ontario Equal Pay Coalition emphasizes average annual earnings as it provides a comprehensive view of women’s economic inequality. The Institute for Gender and the Economy explains that the wage gap is not solely due to unequal pay for the same work but also significantly results from job segregation, where women often work in lower-paid job categories or sectors.

The Urgency of Closing the Gender Pay Gap

Root Causes of Gendered Poverty

The gender pay gap is a fundamental cause of gendered poverty. Women in Canada are more vulnerable to low income than men, partly due to the pay gap (Fox and Moyser, Statistics Canada, 2018).

Impact Across Life Stages

The pay gap affects all life stages. Girls aged 12 to 18 experience a summer job pay gap of nearly $3.00 per hour (Girl Guides of Canada, 2018). Women post-secondary students graduate with student loans and fewer means to repay them (Canadian Women’s Foundation, 2019). Furthermore, there is a gendered pension gap of 22%, with women retiring with approximately 80% of the pension men receive (Mercer CFA Institute, 2021).

Global Implications

On a global scale, Canada ranks 36th in the World Economic Forum’s (2023) listing of 156 countries regarding the gender gap in economic participation and opportunity. The worldwide economic gender gap is projected to take 169 years to close (World Economic Forum, 2023).

Taking Action

The gender pay gap in Canada requires urgent attention and action. Achieving equal pay for equal work is crucial and can be supported by research, advocacy efforts, and a commitment to lasting pay equity. To begin this journey, consider taking the Wage Equity pledge. This pledge commits your organization to fair pay practices and provides a framework to guide your efforts. By leveraging this information and resources from Wage Equity, you can create a just workplace where every employee feels valued and supported. Taking the pledge is a step towards not only addressing wage disparities but also fostering a culture of equity and inclusion.