19 October 2021

On the International Equal Pay Day,

TRENDS publishes a study on pay gaps globally and how to address them

(latest ILO reports show sizeable differences in the estimates of the gender pay gap)

TRENDS Research and Advisory published a study titled “Global Gender wage inequality: The Existing Gaps and How to Address Them” emphasizing the importance of promoting justice by applying the ‘equal pay for equal work’ principle without any discrimination based on gender or race.

The study argues that the sizeable pay gaps negatively affect economic development plans and social welfare, and they seem to persist for another four centuries in some case, exacerbating their negative effects on developed and developing countries alike.

The study reviews the development of international attention to the principle of equal pay for equal work since the International Labor Organization approved it in 1919 up to the adoption of the International Equal Pay Day by the United Nations within its agenda to draw the world attention to the importance of that principle without any discrimination. The call for equal pay for equal work harkens back to the Universal Declaration of Human Rights which was adopted by the United Nations General Assembly in 1948.

Based on the United Nations statistics, the study notes that there is a worldwide gender pay gap, with women earning only 77 cents for every US dollar earned by men, on average, from the same work. This makes women poorer than men throughout their working lives, not to mention their responsibility for the bulk of unpaid care and housework. Ironically, there is the so-called “motherhood penalty” where working mothers encounter biological and cultural disadvantages in pay relative to childless women, while working fathers earn a higher income relative to childless men for the same work; thanks to the so-called “paternity bonus”.

According to the study, despite the passage of more than 50 years sine wage discrimination was declared illegal in the United States, race-based pay gap remains. The gender pay gap among workers of Asian descent will remain until 2041, while it will continue among Hispanic American until 2451.

The study stresses that the application of ‘equal pay for equal work’ principle without any form of discrimination brings about a myriad of benefits for the employers, employees and the nation at large. As a result, many countries include this principle explicitly in their laws and regulations, and business owners, public and private, show a tendency to localize it.

The study concludes by emphasizing the importance of promoting justice through the application of equal pay for equal work principle without any discrimination based on gender or race. It draws attention to the negative implications of pay gaps on economic development plans and social welfare. These pay gaps disregard the right to equal opportunities and choices for everyone, and increase employee turnover and brain drain, leading to higher employment cost and distortion of the mental image of the institution. These facts together lead to lower productivity rates, lower incomes and lower accumulation of wealth, making the achievement of development goals more difficult.

This study comes on the occasion of the ‘International Equal Pay Day’ and as part of TRENDS’s studies, which reflect its vision of foreseeing and building the future through knowledge, its goals of actively contributing to sound research and studies to detect international risks and opportunities, and its strategy for influencing and contributing to the development of policies and decisions taken by governments and international organizations with regard to all aspects of international and strategic issues.