How to decrease the gender pay gap in 2023

We have come a long way as a society in reducing discrimination in the workplace. It’s important that we recognize and celebrate our achievements on this front.

However, before we go patting ourselves on the back and kicking up our feet to relax after a job well done, there is still much progress yet to be made.

In this short article, we’ll take a look at what exactly is meant by the gender pay gap and where it is in 2023 in relation to previous years. We’ll also take a look at how we’ve been able to reduce the gender pay gap, what methods and trends have contributed to its reduction, and how we can encourage this trend.

The gender pay gap – controlled versus uncontrolled

Equal pay for equal work – sounds simple and clear-cut enough, right? However, when we’re talking about the gender pay gap, it’s a bit more complicated than a simple slogan. Firstly, we need to differentiate between controlled and uncontrolled data.

Controlled gender pay gap

As the moniker suggests, the controlled gender pay gap reveals how much women earn compared to men when the data is controlled to account for relevant factors such as job title, years of experience, hours on the job, region, etc. The controlled gender pay gap is the data that most closely echoes the sentiment of ‘equal pay for equal work.’

In the industrialized world, when the data is controlled for like variables, women make roughly 99 cents for every dollar a man earns. This is an improvement from the 97 cents for every dollar we saw in the data a mere seven years ago.

Uncontrolled gender pay gap

Another way to view the earning disparity between women and men is by considering these two subsets on the whole (without controlling for similarities in the data). In the industrialized world, when we consider all women of working age and compare what they earn to men of working age, we find that women make roughly 83 cents for every dollar a man makes. This disparity is known as the uncontrolled gender pay gap.

It’s worth pointing out that the uncontrolled gender pay gap shows us that women earned roughly 73 cents for every dollar a man earned a mere seven years ago. We have reduced the uncontrolled gender pay gap by about 10 cents in a relatively short period of time.

It is also worth pointing out that this represents the most substantial reduction in the gender pay gap in so short a time frame since we started collecting data on the gender pay gap some 70 years ago

The two different ways to look at the data tell us two different and important things about society and about the steps we still need to take. 

To a certain extent, the uncontrolled gender pay gap tells us that there are potentially more and better opportunities more widely available to men than there are for men. Although surveys suggest that more women tend to work part-time compared to their male counterparts, and women tend to go into different professions than men. But how much of the disparity is by choice, societal pressure, or gender discrimination, it is hard to tell on a macro level.

The disparity in the controlled gender gap, while significantly smaller, could be argued that it is far more egregious. When the data is controlled for job-related factors such as position, years of experience, working hours, etc. it is difficult to see in the disparity anything but sexism and discrimination.

Factors that have already contributed to the reduction of the gender pay gap

Legislation has gone a long way toward reducing the gender pay gap in the industrialized world. The most significant reduction can be attributed to the implementation of a minimum wage.

It is undeniable that motherhood or the ‘possibility of motherhood’ has had a penalizing effect on how much women earn. Recent laws that encourage the sharing of the responsibility of parenting between mother and father (such as paternal leave) have helped to reduce this penalizing effect.

Encourage a shared responsibility in childrearing

The inclusion of daycare and creche facilities in the workplace as well as passing laws that grant men paternity leave (which serve to further promote the notion of shared responsibility in childrearing), these initiatives have already been shown to contribute to reducing the gender pay gap (both controlled and uncontrolled). These initiatives and ones similar to them should be encouraged.

Artificial intelligence in the recruitment process

The increasing prevalence of artificial intelligence (AI) in our daily lives can be viewed with both a positive and a negative eye. This is also true of its inclusion in our work life.

Regardless of how you feel about the increased presence of AI, it is worth pointing out that when AI systems (or machine learning algorithms) are implemented in the recruitment process, they have been shown to lead to a significant decrease in hiring bias.

Recruiters and HR professionals, while they may be armed with the best of intentions, are still susceptible to biases. Sometimes, they let their biases affect their hiring decisions, and they may not even be aware they are doing so. This is known as unconscious bias, and it is a significant factor contributing to discrimination in the workplace.

On the other hand, implementing AI in the hiring process helps HR professionals make data-driven decisions. Provided that the algorithms the AI systems use are regularly controlled (meaning the data they are analyzing is rich in diversity), AI is free of bias, and opportunities are given on the basis of merit rather than on non-work-related factors such as gender. 

Because AI is having such a positive effect on reducing the gender pay gap, it may be worth adding a question about AI to the list of essential questions you need to ask a recruitment agency

The bigger picture

The gender pay gap, while a problem in and of itself, is also the expression of a greater problem: gender discrimination in the workplace. Fighting discrimination can best be done collectively rather than on an individual basis. For further reading on the subject, check out this article on how to overcome gender barriers at work through community connections