Women graduating from university in developed markets in 2020 could be the first generation to close the gender pay gap in their professional lifetimes, according to new research from Accenture (NYSE: ACN) that covers South Africa and other countries.
The report, “Getting to Equal 2017,” reveals that, within decades, the pay gap could close if women take advantage of three career equalisers and if business, government and academia provide critical support.
With these changes, the pay gap in developed markets could close by 2044, shortening the time to pay parity by 36 years. In developing markets, the changes could cut more than 100 years off the time to reach pay parity, achieving it by 2066 and for South Africa specifically by 2041 closing the gap at a faster rate than developing markets shortening the time to pay parity by 52 years.
The future workforce must be an equal workforce. The gender pay gap is an economic and competitive imperative that matters to everyone, and we must all take action to create significant opportunities for women and close the gap more quickly.
Accenture’s research found that, globally, a woman earns an average $100 for every $140 a man earns. Adding to this imbalance is the fact that women are much less likely than men to have paid work (50 per cent and 76 per cent, respectively). This contributes to a “hidden pay gap” that increases the economic inequities between men and women: for every $100 a woman earns, a man earns $258, the research shows while for South Africa this translates to: for every $100 a woman earns, a man earns $191.
The research also identifies several critical factors that affect a woman’s ability to achieve equal pay as early as university. Female undergraduates are currently less likely than their male counterparts to choose an area of study that they believe offers high earning potential (31 percent vs 39 per cent for South Africa) or aspire to senior leadership positions (53 per cent vs 64 per cent locally). Additionally, only 53 per cent of young women (vs 71 per cent of men) in South Africa adopt new technologies quickly and are also much slower in taking up coding and computing courses.
The report, which builds on Accenture’s 2016 research on closing the gender gap in the work place, offers three powerful accelerators to help women close the pay gap:
• Digital fluency – the extent to which people use digital technologies to connect, learn and work;
• Career strategy – the need for women to aim high, make informed choices, and manage their careers proactively; and
• Tech immersion – the opportunity to acquire greater technology and stronger digital skills to advance as quickly as men.
Applying these career accelerators, combined with support from business, government and academia, could boost women’s income by 2030 by $3.9 trillion globally and $47.2b in South Africa enabling the country to reach parity in 2041.
Gender equality is an essential element of an inclusive workplace, and this extends to pay. Business, government and academia all have an important role to play in closing the gap. Collaboration among these organisations is key to providing the right opportunities, environments and role models to lead the way for change.
Accenture surveyed more than 28,000 women and men, including undergraduates, in 29 countries. The sample included equal representation of men and women, representing three generations (Millennials, Gen X and Baby Boomers) across all workforce levels at companies of varying size. The margin of error for the total sample was approximately +/- 0.6 per cent.
Survey data was analysed using econometric modelling to identify drivers of pay equality and career advancement and then combined with published data on education, employment, leadership and research from the World Bank, the OECD, World Economic Forum and the UN to then explore the potential impact of measures to improve equality. The pay gap calculations are based on Accenture’s economic model, which takes into account the lower percentage of women than men in paid work.
Countries included in the full study were Argentina, Australia, Austria, Brazil, Canada, Denmark, Finland, France, Germany, Greater China (includes Hong Kong and Taiwan), India, Ireland, Italy, Japan, Mexico, Netherlands, Norway, Singapore, South Africa, Spain, Sweden, Switzerland, United Kingdom and United States. Indonesia, Malaysia, Philippines, Saudi Arabia, and United Arab Emirates also participated in the survey.
Gale Shabangu is the Inclusion and Diversity lead and Pierre Nanterme is the CEO and chairman at Accenture in South Africa.