This report has examined different statistics of the gender pay gap and the theoretical approaches that can explain these differences. By discussing both statistical measures and theoretical reasoning and presenting survey responses from key stakeholders in the labour market, a comprehensive picture is developed of the challenges and conflicting goals present in establishing equal pay for work of equal value.
A common reflection is that the high degree of gender segregation in the labour market contributes to the pay gap between women and men. Women and men often work in different occupations and sectors, and female-dominated occupations generally have lower pay. This phenomenon, known as value discrimination, refers to occupations that are dominated by women being valued and paid less than occupations with similar skill requirements that are predominantly male.
Another important factor highlighted is the relationship between paid work and unpaid care and domestic work. The unequal distribution of unpaid care and domestic work affects women’s opportunities for full-time work and career development, which in turn negatively affects their pay. Additionally, social norms influence negotiations on entry-level pay differently for women and men, contributing to the pay gap between the groups.
The Nordic countries have a strong tradition of party autonomy, with labour market parties negotiating pay and working conditions. This system has advantages and disadvantages when it comes to achieving equal pay for work of equal value. However, there are clear conflicts of interest between employers and unions, but also between unions in different sectors, for example. Current models contain a problem that, despite stated ambitions, seems to prevent specific measures that lead to change.
A fundamental conflict is over how much the state should intervene in pay formation. Social partners are concerned with party autonomy and want to minimise state interference, while the state seeks to ensure fairness and equal pay for work of equal value through legislation. For example, the introduction of the EU Pay Transparency Directive can be seen as an attempt to increase the role of the state in monitoring and regulating pay.
Combining the different statistics of pay inequality with the theoretical approaches and survey responses of key stakeholders, a deeper understanding of the complex mechanisms underlying the gender pay gap can be reached. It is clear that both structural factors, such as gender segregation and value discrimination, and individual factors characterised by social norms, such as caring responsibilities and pay negotiation, play a role. Reducing the pay gap requires a combination of policy measures, changes in labour market structures and norms and efforts to promote gender equality in both paid and unpaid work.
Policy reforms, such as subsidized and high-quality childcare and elderly care, generous parental leave systems for both parents, and income being taxed individually (separate taxation) rather than per household (joint taxation), have historically led to change. There are also examples of cases where the ban on wage discrimination has yielded results, as have efforts by the social partners. But if there is any will today to close the gender pay gap, then efforts of a kind and scale that we have not yet seen are needed.