Insurers chip away at large gender pay gap

Financial services remains stubbornly among industries with the largest divide in earnings between men and women, although insurers have achieved a significant narrowing of the gender pay gap over recent years and almost half of all promotions in Australia went to women last year.

The latest figures from the Workplace Gender Equality Agency (WGEA), which are published annually and encompass public firms with more than 100 employees, show a gender pay gap in Financial and Insurance Services of 29.5%, second only to frontrunner Construction’s 30.6% gap.

In third place across all industries was Professional, Scientific and Technical Services at 24.7%. Across all industries, the gap was 22.8%, or a difference in annual take home pay of $25,792.

“Despite the high ranking, the finance industry has seen one of the strongest reductions over time,” the WGEA says. “It’s no coincidence that this industry also has the highest proportion (76%) of organisations who have conducted pay gap audits.”

Financial and Insurance Services, which covers 284,884 employees within 257 organisations, had a gender pay gap of 37.5% in 2015.

The WGEA also broke down the results for General Insurance, covering 13,000 employees at 21 organisations and made up of 54% women. That full-time gender pay gap stands at 23.6%, down substantially from 30.4% in 2015.

The survey found 81% of general insurance employers offered paid primary carer’s leave, and that the industry had 14.8% female CEOs (up from 6.1% in 2015), 33.5% female key management personnel and 25.5% female directors.

Director Mary Wooldridge said the WGEA’s latest annual report card on gender equality revealed a mixed result from workplaces, with small improvements “barely making inroads on the overall persistent and sizeable pay gaps, and decision-making structures still dominated by men”.

“From the very top-down, women are undervalued in Australian businesses and underrepresented where decisions are made,” she said.

The Agency’s eighth year of reporting showed increased support across areas like flexible work, paid domestic violence leave and parental leave, but also highlights “the concerning absence of women’s voices in the workplace where it matters most”.

The analysis showed men were twice as likely to earn salaries of $120,000 or higher and women were “substantially overrepresented” at the bottom level of all earners.

In other findings, more than 80% of CEOs are men and 22% of all Australian boards have no women members, yet women scored 47% of promotions on offer last year and for the first time, women now account for 41% of all managers. That’s up from 35.9% over eight years.

Overall progress was mixed – with 42% of organisations making some progress towards reducing the size of their pay gaps during 2020-21, and 37% reporting an increased gap. About 85% of employers still posted pay gaps in favour of men, and gender pay gaps persisted across every industry and occupation.

“Nealy half of employers who did a pay audit took no subsequent action, many believing the gaps identified are explainable or justified,” Ms Wooldridge said. “Action can and should be taken.

“If you’re not making progress on these things, your employees may realise there are others who are – and vote with their feet.”