Gender pay gap guide

The gender pay gap is the difference in the earnings of men and women, expressed as a proportion of men's earnings.

There are many approaches to measuring the gender pay gap, and many factors that influence it, so no single measure can provide a complete picture. Instead, a range of measures should be considered together to understand the comparative earnings of men and women.

This guide will help you to learn more about the gender pay gap and the key ABS indicators, as well as the factors influencing the gap. Our Earnings guide also includes information about our various earnings measures and how to use them.

The gender pay gap describes the difference between the "average earnings" of men and women. It is not a measure of gender pay equality or equal pay - these are concepts that reflect the extent to which men and women are paid the same for performing the same or comparable work. Unequal pay is only one factor which may influence the gender pay gap.

Gender pay gap measures reflect the various social and economic factors affecting earnings and earning capacity of men and women (e.g. paid hours worked, occupation, industry, pay-setting methods, educational attainment, working arrangements, discrimination, and many more factors). There are other labour market measures where a gender gap exists including participation in paid work and hours worked.

There are four key ABS indicators derived from the two-yearly Employee Earnings and Hours (EEH) survey and the six-monthly Average Weekly Earnings (AWE) survey we use as a starting point for analysis of the gender pay gap:

1.  Median hourly cash earnings (EEH)
2.  Mean hourly cash earnings (EEH)
3.  Median weekly cash earnings (EEH)
4.  Mean weekly cash earnings (AWE)

These indicators, available on our Gender indicators page, provide a high-level snapshot of the gender pay gap. This is consistent with the approach used by the International Labour Organization (ILO) in their Global Wage Report 2018/19: What lies behind the gender pay gaps. Finer population (e.g. full-time employees) can be used for more in-depth analysis.

In addition, the following two ABS indicators, based on the ordinary time earnings of full-time adult employees are also presented on Gender indicators:

5.  Mean weekly ordinary time earnings of full-time adult employees (AWE) - the most commonly cited measure of the gender pay gap
6.  Mean weekly ordinary time cash earnings of full-time adult employees (AWE) - the 'cash earnings' equivalent of the commonly cited measure (which includes amounts salary sacrificed)

Mean weekly ordinary time earnings of full-time adult employees has historically been the most cited measure and is available on a long-term comparable basis. However, it is important to note that unlike the first four indicators above, this measure excludes amounts salary sacrificed, which was first collected in 2006.

We also include an equivalent of this commonly cited measure that includes salary sacrifice ('cash earnings'). The cash earnings series is the most comprehensive measure of earnings and is consistent with our latest underlying earnings concepts. Prior to 2006, salary sacrifice was excluded from our earnings concepts. Following a review, we implemented changes to our earnings conceptual framework to include amounts salary sacrificed. Estimates that exclude salary sacrifice are still produced in AWE to provide an uninterrupted historical time series (see Information Paper: Changes to ABS measures of employee remuneration), alongside estimates that include salary sacrifice.

Cash earnings series generally produce smaller gender pay gaps due to the prevalence of salary sacrifice arrangements in female dominated industries, such as Health care and social assistance. Women, on average, have higher salary sacrifice amounts than men.

There are many approaches to measuring the gender pay gap, and many factors that influence it, so no single measure can provide a complete picture. Instead, a range of measures should be considered together to understand the comparative earnings of men and women. Each measure will show a different sized pay gap, reflecting the impact of differences in the distribution of earnings amongst men and women (median v mean earnings) and compositional factors related to hours worked (hourly v weekly earnings).

Our data sources

We recommend a combination of indicators from EEH and AWE - to leverage the greater detail available from EEH data with the greater frequency and timeliness of AWE data.

EEH provides detailed compositional earnings data for men and women every two years, allowing for comparison of weekly and hourly, and mean and median earnings. AWE provides a long time series of mean weekly earnings for men and women. AWE measures are published every six months (three months after the survey reference period) so provide more frequent and timely, but less detailed, indicators of the gender pay gap. For more information on comparing EEH and AWE statistics, see A guide to understanding employee earnings and hours statistics.

The gender pay gap differs between indicators because of differences in the composition and distribution of male and female earnings. This is why we recommend using a range of indicators together, particularly in the early stages of any gender pay gap analysis. Use this section to understand how the choice of data measure influences the size of the gap.

​​​​​​Average earnings can be derived as either a median or mean value.

The median is the most representative measure of average earnings, as it is the midpoint of earnings distributions, where half of people earn more than the median earnings value and half earn less than the median earnings value.

Mean measures are calculated by dividing total earnings by the total number of employees. They are affected by the distribution of earnings of the population. A relatively small number of highly paid employees can skew the mean higher. The Average earnings guide includes more information on these measures and how to use them.

Impact on the gap

Earnings for both men and women have a positively skewed distribution, with approximately three in five employees earning less than the mean. However, a larger proportion of men than women are highly paid.

As a result, the difference between mean and median earnings for men is larger than the difference between mean and median earnings for women. Gender pay gap measures derived using mean earnings data will usually produce a larger gap than measures derived using median earnings data.

Source: Microdata and TableBuilder: Employee Earnings and Hours, May 2023

Earnings measures are generally presented on either a weekly or hourly basis. Weekly measures are more affected by differences in the overall composition of the workforce, hours worked and work patterns. Hourly measures remove the effect of differences in hours worked each week. The Weekly and hourly earnings guide includes more information on these measures and how to use them.

Impact on the gap

Gender pay gap measures derived using weekly (or annual) earnings for men and women reflect that women do less paid work on average than men. As a result, these measures show a larger gap than measures derived using hourly earnings data which provides a common basis for comparison.

Ordinary time earnings and total earnings measures are available.

• Ordinary time earnings include payments for award, standard or agreed hours of work, including allowances; penalty payments; payments by measured result; and regular bonuses or commissions. 
• Total earnings include ordinary time earnings and overtime earnings. Overtime earnings are payments for hours worked in excess of award, standard or agreed hours of work.

The Earnings chapter in the Labour Statistics: Concepts, Sources and Methods has more information on earnings and employee remuneration related concepts and how we produce the data.

Impact on the gap

Gender pay gaps derived from total earnings rather than ordinary time earnings provide a measure that reflects all the earnings received by men and women. Men, on average, are more likely to work overtime and have higher overtime earnings.

In addition to all employee measures, full-time and part-time status is widely used to categorise people or jobs in terms of the number of hours worked. In our business surveys, we classify employee jobs as full-time or part-time based on whether the person has been engaged by the employer on a full-time or part-time basis. In AWE, data is produced for full-time adult employees and other employees (i.e. employees who are part-time or paid at junior rates). In EEH, data can be analysed for all full-time employees or for full-time adult employees.

Our household surveys (including the monthly Labour Force Survey) define people as employed part-time if they usually work less than 35 hours per week and actually worked less than 35 hours in the reference week. People are classified as full-time if they usually work 35 hours or more per week, or actually worked 35 hours or more in the reference week (even if they usually work less than 35 hours per week). For more information, please see the Employment arrangements chapter in Labour Statistics: Concepts, Sources and Methods.

Impact on the gap

Many women work part-time so the choice of full-time, part-time or all employee measure will affect the derived gender pay gap when weekly or annual data are used.

Earnings differentials of full-time employees have traditionally been used to provide a more common basis for comparison, however this results in a gender comparison excluding almost half of all working women. Measures that include all employees (regardless of working hours) will show a larger gender pay gap as women work less hours than men, on average. Full-time women also work less hours, on average, than full-time men.

Measures of weekly earnings that are limited to part-time workers show varied results given they include a broad range of hours worked, so measures of hourly earnings are preferred.

Use this table to find earnings data sources which can be used to measure the gender pay gap by topic (for example, additional characteristics).

Household sources are generally preferred for person characteristics with business sources preferred for job and employer characteristics. However, business sources provide more accurately reported earnings as data are obtained from employers' payrolls rather than the recall of employees or their partners. The quality of earnings data has been prioritised when assigning ratings in the table below. For more information on the strengths and limitations of different sources, please see the Earnings chapter of Labour Statistics: Concepts, Sources and Methods.

This section summarises available data which can be used to measure the gender pay gap. It also includes other information which may help you to understand gender pay gap measures and factors influencing the gap.

We produce many earnings data sources which can be used to measure the gender pay gap. The most relevant data sources are included below.

We produce many data sources which provide information on labour market outcomes of men and women beyond earnings measures. The most relevant data sources are included below.

Our Gender indicators page includes a range of economic and social indicators for men and women.

ABS resources

• Gender indicators
• Labour Statistics: Concepts, Sources and Methods
• Earnings guide - Guide to ABS labour statistics

WGEA resources

These resources provide additional insight into factors influencing the gender pay gap.

• What is the Gender Pay Gap - Workplace Gender Equality Agency
• The Gender Pay Gap Calculator
• WGEA Scorecard 2022: The state of gender equality in Australia
• She's Price(d)less - The economics of the gender pay gap
• Wages and Ages: Mapping the Gender Pay Gap by Age - Workplace Gender Equality Agency

ILO resources

• Global Wage Report 2018/19: What lies behind the gender pay gaps - International Labour Organization