Report

Closing the gender pay gap: A review of the issues, policy mechanisms and international evidence

This report aims to review the key issues, policy mechanisms and international evidence with respect to closing the gender pay gap. The core focus of this report is on wage setting institutions and their impact on inclusive and gender equitable labour markets.

Closing the gender pay gap is an aspiration found in many international policy documents. The principle of equal remuneration for men and women for work of equal value, as set out in the Equal Remuneration Convention, 1951 (No. 100), needs to be implemented if gender equality and decent work for all is to be achieved. However, while the principle of equal pay for work of equal value has been widely endorsed, and is included under Goal 8 in the 2030 Sustainable Development Agenda, a key problem is that the policy mechanisms needed to achieve this objective are not well understood and in fact are both multifaceted and vary according to the institutional context.

Specific gender equality policies are certainly required, but these are only likely to be effective if embedded within a general policy environment which is promoting equal and inclusive labour markets. For example, trends towards greater inequality in wage structures, more individualised pay determination and more variable working hours in higher level jobs are likely to be increasing the gender pay gap, offsetting to some extent the more beneficial effects of women’s rising educational attainment and more continuous participation in employment.

While the gender pay gap is difficult to measure, the ILO estimates that if the current trends prevail, it will take more than 70 years before the gender wage gap is closed completely (ILO 2016). This paper aspires to review key issues, policy mechanisms and international evidence with respect to closing the gender pay gap. Furthermore, as the gender wage gap is unrelated to a country’s economic development, research is needed to understand how an equitable distribution of economic growth can be achieved (ILO 2016).