10 January 2021

The Gender Pay Gap and the Coronavirus “Shecession”.


The coronavirus recession has been called a “shecession” – as opposed to the 2007-2009 Great Recession targeting male-dominated industries – in light of the disproportionate impact that the disruption caused by covid-19 containment measures has had on underpaid service sectors such as leisure, hospitality and childcare, where non-white women are over-represented. The steep increase registered in 2020 in the unemployment rate for young women is likely to have a long-term impact on their economic independence and security.

Inequality in earnings – including wages and other forms of compensation – places women at even greater disadvantage when facing economic shocks, as they can dispose of less financial resources to meet basic necessities.

The Equal Pay International Coalition (EPIC) has celebrated in September 2020 the first International Equal Pay Day, where all labour market actors were encouraged to put “equal pay at the heart of recovery efforts worldwide”. It is clear that the achievement of Sustainable Development Goal (SDG) 8.5 on promoting equal pay for work of equal value is strictly linked with the achievement of SDG 5 (in particular 5.5 and 5A) on the empowerment of women and girls, and it cannot be fully attained without the achievement of gender equality in all its dimensions, including equality in earnings. It is not only a matter of law (economic discrimination against women is prohibited under international law and yet women continue to be paid on average 20% less than men around the world); addressing the gender pay gap is essential in order to move towards the implementation of the 2030 Agenda for Sustainable Development, and yet it has been estimated that to reach gender parity we will need to wait almost 100 years.

The covid-19 crisis is forcing us to acknowledge the weaknesses of our socio-political system, especially the lack of protection for the most vulnerable. As public interest around data rights rises, the potential of using data for public service is appreciated by the institutions, while citizens evaluate the risks of its unintended use. This is a unique moment to build consensus around the urgent need for a trustworthy data governance model that allows community awareness and citizen engagement on data policies. As women across the globe experience enhanced economic inequalities, targeted gender legislative and policy reforms need to be put in place now to minimize the risks of future crises’ repercussions. It is during states of emergency, when human rights are restricted, that we need enhanced democratic oversight and a solid culture of transparency and accountability.

Data transparency and openness as a tool to overcome gender inequality has gradually gained attention in gender pay debates at the international level. Openly accessible data on gender disparities in pay has shown to be effective per se in narrowing the income gap, and data on the size and drivers of the pay gap have been deemed helpful to enforce and monitor equal pay rights. To help narrow the gender pay gap, advocacy for the adoption of pay transparency legislation is needed. Privacy, data ethics, transparency organizations and the open data movement should speak with one voice to advocate jointly for a conscientious data governance framework, and ensure that opening up data does not result in an unjustified interference with the employees’ rights. While Governments are the ultimate responsible for incorporating gender pay equity in public policies and legislation, business enterprises can play a crucial role in the advancement of women’s economic rights by leading the way in the implementation of transparent and fair remuneration policies, thereby creating good practices that may guide Governments’ efforts towards the development of public reforms.

It has been widely acknowledged that gender pay gap reporting is not only the right thing to do: transparency can benefit a business enterprise by minimizing the reputational and economic risks of legal actions against discriminatory policies while building trust amongst employees, helping talent retention as well as employees’ development and engagement. Closing the gender pay gap would promote better performance, increase productivity and help countries reach their full development potential. It would also strengthen the economy, including by cutting poverty rates among working women and their families. By ensuring equal pay and transparency within their workforce, addressing bias in the system, supporting the use of disaggregated data at the basis of equality initiatives and investing in eradicating harmful practices (e.g. occupational sex segregation and salary history requirements), Governments and business enterprises would contribute to women’s financial empowerment, which in fact would help boost the economy as a whole: as reported by the ILO, studies have linked increased labour participation rates of women with higher levels of GDP – this may be due to the creation of a virtuous circle which sees more purchasing power leading to increased investments into education and health of children (as it has been observed that women invest more money than men into their households and communities).

In light of the devastating impact that the current covid-19 pandemic is having on women and girls, owing to the exacerbation of pre-existing disparities, working towards closing the gender pay gap finds a renewed prominence. This is only a symptom of wider systemic inequalities in the workforce. But placing high-quality open data at the center of gender policies, both in the public and in the private sector, can help achieve a long-term, sustainable change around gender equality.