Equal Pay Day in Ontario: Time to Close the Gap

It’s Equal Pay Day in Ontario — a day to recognize the persistent pay gap between men and women.

It’s also a moment to focus on policies that can effect real change, because the labour market looks radically different today than it was a generation ago.

In 1976, the world of work was still generally a man’s world. Women made up only two out of five workers . The pay gap was big then: women made 44.4 cents for every man’s dollar.

Fast forward to today: about half of all workers in Ontario are women but the pay gap persists. Women make only 70 cents for every man’s dollar (average annual earnings, 2013).

Women are leading the way in post-secondary education. Almost three-quarters of women in Ontario had postsecondary education in 2015, compared to 66.9 per cent of men. Women are doing everything it takes to support raising a family, make ends meet, and thrive in their careers.

The gender pay gap persists in all types of jobs

They have been part of a quiet revolution, where women have entered the workforce in droves. But the pay gap persists in all manner of occupations. As CCPA Senior Researcher Kate McInturff has reported, women are paid less in 469 of the 500 occupations that Statistics Canada tracks.

For instance, a study by Kendra Coulter and Angella MacEwen last year revealed women are paid less than men in every job category within the retail sector.

Even when women are in higher paying jobs, the pay gap remains. In a report we published last year by Mary Cornish, the pay gap follows women up every step of the income ladder. Among the highest paid 10 per cent of women, they earn 37 per cent less than their male counterparts. Over a 35-year period, those women could earn $2.24 million, on average, less than the highest paid 10 per cent of men.

We know from other research that the pay gap is worse for immigrant women (39 cents) and Indigenous women (57 cents).

Data for racialized women hasn’t been updated since 2011, since the racialization variable was dropped in Statistics Canada's transition from the Survey of Labour and Income Dynamics to the Canadian Income Survey. We will now have to rely on census data every five years to measure that progress. New numbers should be coming out this year.

The pay gap is bad for the economy

The gender pay gap is bad for women and families. A Ministry of Labour report says that "in 2008, 18% of women in dual-income families were their families' primary breadwinners (when measured in hourly earnings), bringing in more than 55% of the household income."

The gender pay gap is also bad for the economy.

A report prepared for the Ontario government by Deloitte LLP found that "a qualified working woman who has same socio-economic and demographic characteristics (e.g., education level, age, marital status), and experience in the workplace (e.g., job status, occupation, and sector) as a man, on average receives $7,200 less pay per year. This amounts to $18 billion of foregone income per year for all working women in Ontario, which translates to about 2.5% of Ontario’s annual Gross Domestic Product (GDP). To put this into context, the motor vehicle and parts industries together account for 2.5% of the province’s 2015 GDP."

So the gender pay gap remains stubbornly in place. What to do?

Four years ago, the Ontario government began to officially acknowledge Equal Pay Day, thanks to the efforts of the Equal Pay Coalition.

Two years ago, Premier Kathleen Wynne set in motion a government review of the gender wage gap. Last August, it released the final report of the Gender Wage Gap Steering Committee. The government news release stated: "Elimination of the gap could significantly improve the province’s economy. Royal Bank of Canada estimates that personal incomes would be $168 billion higher each year if women in Canada had the same labour market opportunities as men."

The government has also created a website which serves as an excellent resource on this issue and it has funded some instructive research on the gender pay gap.

But there is much more to be done. Last week, the Conference Board of Canada reported that all jurisdictions in Canada are falling behind their global peers on addressing the gender pay gap. It gave Ontario a "C" grade on its efforts to close the gender pay gap.

Equal pay is possible

It’s time to implement real measures to speed up the pace of change.

The government could take inspiration from Iceland, which has committed to a plan to completely close the gender pay gap in five years’ time. Iceland will “require public and private companies to pay employees equally ‘regardless of gender, ethnicity, sexuality or nationality’.”

Here’s another source of inspiration: the Ontario Equal Pay Coalition is proposing a new law that would hold Ontario companies to account by having employers publicly report their gender pay structure once a year.

The proposed Equal Pay Coalition law would:

• Require reporting based on job classifications.
• Set out employees’ right to know about their employer’s pay structure.
• Protect employees from punishment for discussing pay structure.
• Require employers to file mandatory pay transparency reports with the Ministry of Labour and with their shareholders annually. It would also apply to government procurement processes.

The majority of women now participate in Ontario’s labour market. They’re more educated than ever. They have radically reshaped the work reality in this province. They are contributing to economic growth. But as long as the gender pay gap persists, the revolution remains unfinished. It's time to close the gap.

Trish Hennessy is director of the Canadian Centre for Policy Alternatives’ Ontario office. Follow her on Twitter @trishhennessy.