Labour Statistics and the Gender Gap- In 2018, female employees aged 25 to 54 earned $4.13 (or 13.3 per cent) less per hour, on average, than their male counterparts. In other words, these women earned $0.87 for every dollar earned by men. The Gender Wage Gap Decreased Between 1998 and 2018- The gender gap in hourly wages has narrowed by $1.04 (or 5.5 percentage points) since 1998, when it was $5.17 (or 18.8 per cent). The reduction in the gender wage gap between 1998 and 2018 was largely explained by changes in the distribution of men and women across occupations; women's increased educational attainment; and the decline in the share of men in unionized employment. - The two largest factors explaining the remaining gender wage gap in 2018 were the distribution of women and men across industries, and women's overrepresentation in part-time work, the same largest explanatory factors behind the gap in 1998. Real wages (adjusted for inflation) grew faster for women aged 25 to 54 than for men in this age group between 1998 and 2018 (Table 1). Specifically, women's average real hourly wages increased by 20.5 per cent over the period, while men's increased by 12.9 per cent. As a result, the gender wage gap decreased by 5.5 percentage points, from 18.8 per cent in 1998 to 13.3 in 2018.
Change in Occupational Distribution a Key ContributorBetween 1998 and 2018, the occupational distribution of men and women explained just over a quarter (26.3 per cent) of the reduction in the gender wage gap. Notable narrowing effects came from professional occupations in law and social, community and government services (8.5 per cent), professional occupations in education services (7.7 per cent) and professional occupations in business and finance (7.2 per cent). These three higher-paying occupational groups employed a larger share of core-aged women in 2018 than in 1998. Also, earnings grew faster for women than men in two of the three groups (professional occupations in law and social, community and government services and professional occupations in business and finance). Despite the net positive effect of occupation on the narrowing of the gender wage gap, some individual occupations served to widen the gap, notably professional occupations in natural and applied sciences (-9.2 per cent) and administrative and financial supervisors and administrative occupations (-7.4 per cent). These two groups employed a larger share of core-aged men in 2018 than in 1998, while earnings also increased faster for men than women in professional occupations in natural and applied sciences. Changes in Industrial Distribution Decrease Gender Wage GapAlthough changes in occupational distribution contributed to the decrease in the gender wage gap from 1998 to 2018, the distribution of men and women across industries served to widen the gap (-8.0 per cent). This was driven by the high-paying and male-dominated construction sector (-14.0 per cent), where employment increased over the period. The manufacturing sector helped to counteract the effect of construction, contributing 7.3 per cent to the narrowing of the gap over the 20 years. This was largely due to the decline in employment in manufacturing that occurred over the period, with 25.2 per cent of core-aged men employed in this sector in 1998, compared with 15.5 per cent in 2018. Women's Increased Educational Attainment Helped to Narrow GapThe increase in women's educational attainment, relative to men's, was the second most important determinant of the decrease in the gender wage gap between 1998 and 2018. While equivalent proportions of women and men had a university degree at the bachelor level or above in 1998 (21.6 and 21.5 per cent, respectively), the proportion of women with at least a bachelor's degree increased to a greater extent in the following 20 years than did the equivalent proportion of men (+19.6 percentage points vs. +10.8 percentage points). As workers with higher education earned more on average, the relative increase in women's educational attainment accounted for 12.7 per cent of the decrease in the gender wage gap that occurred over the period. The other human capital variable, job tenure, explained 5.5 per cent of the reduction in the gap, largely due to a decline in men's job tenure relative to women's between 1998 and 2018. By 2018, women's average job tenure (89.4 months) surpassed that of men (86.8 months). Men's Decreased Union Coverage Also Had Narrowing EffectChanges in job attributes also contributed to the decrease in the gender wage gap that occurred over the 20 years. Particularly important in this regard was union coverage. While the proportion of men covered by a union or collective agreement decreased by 8.6 percentage points between 1998 and 2018 (from 38.2 to 29.5 per cent), the equivalent proportion for women held steady at a little less than 36 per cent. These differing trends largely reflected the fact that men with union coverage were concentrated in manufacturing -- a declining sector through the first half of the period -- whereas women in unionized jobs have been concentrated in health care and social assistance, and educational services. Since union coverage is associated with higher average wages, the decrease in the proportion of men with union coverage led this variable to account for 9.3 per cent of the decrease in the gender wage gap that occurred between 1998 and 2018. The other job attribute variables each accounted for a smaller part of the narrowing over the period, with part-time and public sector employment at 4.8 per cent each, and firm size at 3.1 per cent. Beginning with part-time employment, the narrowing effect was tied to a decline in the proportion of women working part time, from 21.0 per cent in 1998 to 16.0 per cent in 2018. Meanwhile, the narrowing explained by public sector employment was due to an increase in the proportion of women working in the public sector (34.1 per cent in 2018, compared with 31.1 per cent in 1998), while earnings returns for these workers also increased. Lastly, the portion of the narrowing explained by firm size was driven by an increase in the proportion of women working for large firms (defined as having more than 500 workers), which tend to have higher wage premiums than smaller firms. Key Part of Remaining Gap Explained by Industrial DistributionThe industrial distribution of men and women explained the largest portion of the gender wage gap in both 1998 (16.5 per cent) and 2018 (39.7 per cent). Additionally, the same three sectors drove the gender wage gap in both years: construction (6.3 per cent in 1998 and 17.7 per cent in 2018), manufacturing (8.5 per cent in 1998 and 9.1 per cent in 2018), and mining, quarrying, and oil and gas extraction (3.5 per cent in 1998 and 6.7 per cent in 2018). These three sectors drove the gender wage gap in both 1998 and 2018 due to employing substantially larger shares of men than women, and due to their relative wage premiums. Along with industry, occupational distribution also explained a small part of the gap in 1998 (1.8 per cent) and 2018 (5.1 per cent). Among all occupations, the male-dominated professional occupations in natural and applied sciences contributed the most to the existence of the wage gap in both 1998 and 2018. This is consistent with the results discussed above, showing that increased employment and earnings for men in this occupational group had a widening effect on the gap over time. Part-time Employment Contributes to the GapBeyond gender differences in industry and occupation, only women's overrepresentation in part-time employment explained a notable portion of the gap in 1998 (8.9 per cent) and 2018 (9.2 per cent). While the previous section showed that some reduction in part-time work among women contributed to the narrowing of the gap over the period, and even though women received a smaller wage penalty for part-time work than men, women's higher likelihood of working part time still contributed to the existence of a gender wage gap in both 1998 and 2018. Despite having virtually no effect in 1998, public sector employment and union status each counteracted the gap in 2018, at -5.3 and -3.4 per cent respectively. This is consistent with the previously-discussed increase in public sector employment for women and decrease in union coverage among men between 1998 and 2018. While job tenure had little impact on the gap in 2018, men's longer job tenure than women in 1998 explained a small portion of the gap (2.3 per cent) at that time. Education had virtually no impact on the gap in 1998, but it counteracted it in 2018 (-4.8 per cent). This finding largely reflects the fact that more women than men had a university degree at the bachelor level or above in 2018. (Source: "The gender wage gap in Canada: 1998 to 2018," Rachelle Pelletier, Martha Patterson and Melissa Moyser, Statistics Canada, October 7, 2019.)
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