1350.0 - Australian Economic Indicators, 1996
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 05/04/1996
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Feature Article - Trends in the Female-Male Earnings Ratio GRAPH 1: RATIO OF FEMALE TO MALE AVERAGE WEEKLY EARNINGS All employees Main Findings In August 1994, the female-male earnings ratio was 67.0 per cent. Among the major influences on the gap between female and male average weekly earnings were:
Between August 1975 and August 1994, the female-male earnings ratio closed by 1.2 percentage points. Among the major influences on the lack of change in the gap between female and male average weekly earnings were:
Part-time Employees In August 1994, there was a substantially higher proportion of female employees working part time (41.5 per cent) than male employees (10.7 per cent) (Table 1). This difference has a major influence on the lower average weekly earnings of female employees, and consequently on the ratio of female-male average weekly earnings (the actual average weekly earnings ratio). TABLE 1. EMPLOYMENT STRUCTURE AND ACTUAL AVERAGE WEEKLY EARNINGS RATIO: EMPLOYEES, AUGUST 1994
To assess the effect of differences in the proportion of female and male employees working part time, an adjusted average weekly earnings ratio can be calculated by weighting the full-time and part-time average weekly earnings for female and male employees according to the proportions of all employees in full-time and part-time employment. In August 1994, the adjusted average weekly earnings ratio was 83.7 ˙per cent (Table 2), which was 16.7 percentage points higher than the actual average weekly earnings ratio (67.0 per cent). TABLE 2. ADJUSTED AVERAGE WEEKLY EARNINGS RATIO(a): EMPLOYEES, AUGUST 1994
Trends in Part-time Employment In recent decades, there has been a substantial rise in the proportion of both female and male employees working part time. Between August 1975 and August 1994, the proportion of female employees working part time increased 12.1 percentage points (from 29.4 ˙per cent to 41.5 per cent), while the proportion of male employees working part time increased only 7.1 percentage points (from 3.6 per cent to 10.7 per cent) (Graph 2). GRAPH 2: PERCENTAGE OF EMPLOYEES WORKING PART TIME GRAPH 3: ACTUAL AND ADJUSTED AVERAGE WEEKLY EARNINGS RATIO: WAGE AND SALARY EARNERS Further insight into the gap between female and male average weekly earnings can be gained by exploring differences in the average number of hours worked by female and male employees. In August 1994, female employees worked on average 29.6 hours per week, compared with an average of 40.3 hours for male employees. While this difference was due in part to the higher proportion of female employees working part time, it was also due to full-time male employees working more hours on average (43.1 hours) than full-time female employees (38.5 hours). To assess the effect of differences in the average number of hours worked by female and male employees, an actual average hourly earnings ratio can be calculated. In August 1994, the actual average hourly earnings ratio was 91.3 per cent (Table 3), which was 24.3 percentage points higher than the actual average weekly earnings ratio (67.0 per cent). TABLE 3. AVERAGE WEEKLY HOURS WORKED AND ACTUAL AVERAGE HOURLY EARNINGS RATIO: EMPLOYEES, AUGUST 1994
For full-time employees, the actual average hourly earnings ratio (89.8 per cent) was higher than the actual average weekly earnings ratio (80.3 per cent), while for part-time employees, the actual average hourly earnings ratio (108.5 per cent) was lower than the actual average weekly earnings ratio (117.7 per cent). This reflects the influence of the lower average number of hours worked by females in full-time employment, and the higher average number of hours worked by females in part-time employment. Trends in Hours Worked While the proportions of both female and male employees working part time have risen over recent decades, the average number of hours worked per week has also risen for both full-time and part-time female and male employees (Table 4). This rise was greatest for male employees working full-time. The fall in the average number of hours worked by all female employees reflects the large rise in the proportion of female employees working part time. TABLE 4. PERCENTAGE CHANGE IN AVERAGE WEEKLY HOURS WORKED: EMPLOYEES, AUGUST 1975 AND AUGUST 1994
The fall in the average number of hours worked by female employees compared to the rise in the number of hours worked by male employees has exerted a downward effect on the female-male earnings ratio. Between August 1975 and August 1994, the actual average hourly earnings ratio rose 8.1 percentage points (from 83.2 per cent to 91.3 per cent), while the actual average weekly earnings ratio rose only 1.2 percentage points (Graph 4) GRAPH 4: ACTUAL AVERAGE WEEKLY EARNINGS RATIOS: EMPLOYEES A major difference in the composition of the female and male workforces is the tendency for female employees to be concentrated in a small number of "traditional female" occupations, while male employees tend to be more evenly spread across occupations. However, the "traditional female" occupations are not necessarily the lowest paying female occupations. In fact, some of the "traditional male" occupations have the lowest female average weekly earnings. In August 1994, more than half of all female employees were concentrated in eight (of fifty-two) minor occupation groups; Sales Assistants (11.1 per cent), Numerical clerks (9.7 per cent), Stenographers and typists (7.4 per cent), School teachers (6.0 per cent), Receptionists, telephonists and messengers (5.8 per cent), Registered nurses (4.7 per cent), Tellers, cashiers and ticket salespersons (4.7 per cent), and Personal service workers (4.7 per cent). The difference in the occupational distribution of female and male employees is called occupational segregation. The actual average weekly earnings ratio is influenced by both the amount of occupational segregation and the variation in average weekly earnings across occupations. In August 1994, a negative relationship existed between the average weekly earnings of all employees in the minor occupation groups and the proportion of employees within these groups who were females (i.e. female employees tended to be over-represented in lower paying minor occupation groups) (Graph 5). GRAPH 5: RELATIONSHIP BETWEEN AVERAGE WEEKLY EARNINGS AND PERCENTAGE FEMALE(a) WITHIN MINOR OCCUPATION GROUPS, AUGUST 1994 To assess the effect of differences in the occupational distribution of female and male employees, an occupation-adjusted average weekly earnings ratio can be calculated by giving female and male average weekly earnings equal weights within each minor occupation group. The weight for each minor occupation group is equal to the number of employees in that group expressed as a percentage of the total number of employees. In August 1994, the occupation-adjusted average weekly earnings ratio was 74.0 per cent (Table 5), which was 7.0 percentage points higher than the actual average weekly earnings ratio (67.0 per cent). TABLE 5. ACTUAL AND OCCUPATION-ADJUSTED AVERAGE WEEKLY EARNINGS RATIOS(a): MAJOR OCCUPATION GROUPS, EMPLOYEES, AUGUST 1994
While the occupation-adjusted average weekly earnings ratio was greater than the actual average weekly earnings ratio for all major occupation groups, the magnitude of the difference was greatest for Tradespersons (12.8 percentage points) and Salespersons and personal service workers (10.8 percentage points). These figures reflect the higher concentrations of female employees in lower paying minor occupation groups within these two major occupation groups. However, the lower average weekly earnings in some of these minor occupation groups are due to the lower average number of hours worked by employees within these groups. The combined influence of differences in the occupational distribution of female and male employees and differences in the average number of hours worked by female and male employees can be assessed by calculating an occupation-adjusted average hourly earnings ratio, derived by giving female and male average hourly earnings equal weights within each minor occupation group. The weight for each minor occupation group is equal to the aggregate number of hours worked by employees in that group expressed as a percentage of total number of hours worked by all employees. In August 1994, the occupation-adjusted average hourly earnings ratio was 92.9 per cent (Table 6), which was only 1.6 percentage points higher than the actual average hourly earnings ratio (91.3 per cent). TABLE 6. ACTUAL AND OCCUPATION-ADJUSTED AVERAGE HOURLY EARNINGS RATIOS(a): MAJOR OCCUPATION GROUPS, EMPLOYEES, AUGUST 1994
Conclusion The results of the analysis indicate that a significant part of the gap between female and male average weekly earnings can be explained by the higher proportion of female employees working part time and the lower average number of hours worked by female full-time employees (Graph 6). While female employees also tend to be concentrated in lower paying occupations than male employees, only a small part of the gap between female and male average hourly earnings can be explained by differences in the occupational distribution of female and male employees. This supports previous findings suggesting that most of the gap between female and male average hourly earnings is attributable to female employees occupying lower level positions than male employees within individual occupation groups, rather than differences in the distribution of female and male employees between these groups (Rimmer, 1991). GRAPH 6: SUMMARY OF FEMALE-MALE AVERAGE WEEKLY AND AVERAGE HOURLY EARNINGS RATIOS: AUGUST 1994 Furthermore, the lack of change in the gap between female and male average weekly earnings over the last two decades can be explained by the fall in average hours worked by female employees (mainly due to the increasing proportion of female employees working part time) compared to the rise in average hours worked by male employees (despite the increasing proportion of male employees working part time). For further information about this article please contact The Director, Labour Market Statistics, (02) 6252 7795. This feature article was contributed by John Preston, Labour Statistics Analysis Unit, ABS. References Australian Bureau of Statistics, The Labour Force, Australia, various issues (cat. no. 6203.0) Australian Bureau of Statistics, Average Weekly Earnings, States and Australia, various issues (cat. no. 6302.0) Australian Bureau of Statistics, Weekly Earnings of Employees (Distribution), Australia, various issues (cat. no. 6310.0) Rimmer, S. M. (1991), "Occupational Segregation, Earnings Differentials and Status among Australian Workers", Economic Record, 67, 205-216 Document Selection These documents will be presented in a new window.
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