Women have powered a recent shift toward higher-paying and higher-skilled jobs, but a pay gap will persist until they cease being outnumbered by men in senior management positions, according to a new report by the Royal Bank of Canada.
Canada’s labour market saw nearly 200,000 women stream into jobs involving less in-person contact and often significantly higher wages after many coronavirus pandemic measures were lifted, the report found. Of the $21 billion in additional income created by the movement to higher paid sectors over the pandemic, $9 billion or 43 per cent was funnelled to women. This amounted to 15 per cent of the total boost to women’s earnings during the pandemic recovery.
“But men still made up the majority of the income gains and much of that is likely because the roles that women and men occupy are still different,” says Carrie Freestone, an economist with RBC Economics. “Even though we see women in these higher paid sectors, often the senior leadership roles are disproportionately filled by men.”
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Her research found men made up more than two-thirds of senior leadership positions even though the number of women and men in the labour market are equal.
Some of the inequities were even more pronounced among parents. Freestone found fathers with young kids were far more likely to be senior managers, filling 10 per cent of such roles, while mothers made up fewer than three per cent of the positions. “So it appears that there’s a link between having a kid and the fact that you may be less likely to take on a senior management role.”
Much of Freestone’s research is based on the women who flooded back into the workforce after pandemic lockdowns, pushing participation in the labour market among working women to a record high of 85.6 per cent in January. But the report found many didn’t return to prior jobs or industries and instead sought work that came with higher paid and “more productive” roles.
“High-contact sectors” like hospitality, for example, experienced an exodus of roughly 178,000 employees, when they were forced to close during the height of the pandemic, says Freestone. Many of the workers that fled these sectors were women. Despite filling about 55 per cent of jobs in these sectors before the pandemic, women made up 80 per cent of the movement away from them.
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The report estimated nearly 140,000 women streamed out of jobs in high-contact sectors with many seeking roles in low-contact industries, including professional, scientific and technical services and finance, insurance and real estate.
“The majority of people who moved from these sectors into higher paying sectors did have a degree or a college diploma, so a lot of that was potentially women who were overqualified for positions moving into sectors that better fit their level of educational attainment,” says Freestone.
Though women accounted for 60 per cent of jobs created in finance, insurance and real estate over the course of the pandemic, women with degrees and working in finance, insurance, real estate and rental leasing earned roughly 85 cents for every dollar earned by men. Across all sectors, women made an average of 89 cents for every dollar a man made in 2021, according to Statistics Canada’s latest data.
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