With International Women’s Day on March 8, there has been a flurry of reports about the persistence of a gender wage gap in Canada and globally.
Within Canada, the gender wage gap ranges from a low of four per cent in Prince Edward Island to a high of 17 per cent in Alberta and British Columbia, according to 2022 Statistics Canada data.
In recent years, Ottawa and some provinces have introduced or strengthened laws aimed at addressing pay inequities.
Ontario, Quebec and federally regulated employers all have pay equity legislation that requires work of equal value to be compensated equally. Both B.C. and Ontario introduced pay transparency bills in 2023 that will require employers to disclose compensation information in job listings. B.C.’s bill, which became law in May, also prohibits employers from requesting historical pay information from job applicants.
Notably, the three provinces with the highest gender pay difference, Alberta, Saskatchewan, and B.C., do not have pay equity legislation.
These laws are important, and suggest that all provinces should implement pay equity measures. But research also indicates these measures do not get at the key drivers of pay inequity anymore.
In October 2023, Claudia Goldin, a professor of economics at Harvard University, was awarded the Nobel Prize in Economics for her work on women’s earnings and labour market participation through the centuries.
Goldin’s research shows that, while historically “much of the gender gap in earnings could be explained by differences in education and occupational choices… this earnings difference is now between men and women in the same occupation, and that it largely arises with the birth of the first child,” the Nobel Prize committee’s press release announcing Goldin’s selection states.
Pay equity measures are ineffective tools in this circumstance. When women take time off in their careers for maternity leave or caretaking, while their male counterparts stay in the workforce, employers are not running afoul of pay equity laws if they offer salary hikes and promotions to those who accrue more work experience.
Goldin’s research, highlighted in her book Career & Family, also shows that certain “greedy professions” such as finance, law and consulting pay disproportionately more for long hours and weekend work. Here again, these professions can perpetuate disparities between women and men if women with families, by choice or necessity, opt to be the more available parent while their partners work the more gruelling hours.
This dynamic points to a related challenge. Pay equity will remain elusive, Goldin argues, until households achieve “couple equity” — meaning an equitable sharing of household and caretaking responsibilities. For couples in the greedy professions, household equity can be especially challenging to achieve.
These problems are all, unfortunately, vexing ones to address. Banks, consultancies and law firms have spoken for decades about the need to better retain women, while often failing to fundamentally change their work structures to offer greater flexibility and different pathways to the top. The law also cannot — and should not — regulate how couples act in their private homes.
But there are some measures that could help.
Governments and employers could move from making paternity leave merely available to actively incentivizing fathers to take extended paternity leaves. If fathers and mothers both take time off for caregiving, the pay gap that starts to emerge after kids are born may be less pronounced.
There is evidence from Quebec that men who adopt primary caregiver roles early in their kids’ lives also assume more household and caretaking responsibilities over the long term, which could go some way toward addressing inequities in the home.
Employers can also benefit from restructuring their workplaces to better retain caregiving parents. For example, firms could schedule meetings mid-day to allow daycare pickup and drop-offs. These types of changes may give firms a competitive advantage.
More importantly, parents must choose to model what Goldin calls “couple equity” within their own homes. If they fail to exhibit shared household responsibilities, kids are unlikely to internalize and adopt these values as they become adults and partners.
In short, while governments have a role in implementing pay equity measures, not all aspects of the gender wage gap are ones government can address. Employers and individuals must be part of the solution as well.
