MOM: Singapore women earn 6% less than men in 2018, but gap is closing

Photo: moneycrashers.com

In the country, even after controlling for factors such as education, age and working industry, a woman is more likely to earn less than her male colleague doing the identical job.

A new, first nationwide study released on last Thursday (9 January) by the National University of Singapore economist, Dr Jessica Pan and Ministry of Manpower (MOM) found that the adjusted gender pay gap was 6 per cent in 2018.

The 2018 adjusted gender pay gap was lower than the 8.8 per cent gap in 2002. The 2018 figure is also lower than the gap in countries such as China (18.3 per cent), USA (8 per cent) and Canada (7.7 – 8.3 per cent), according to the Ministry.

Comparing men and women, the median monthly pay of a woman working full-time was 16.3 per cent lower than that of a man working full-time. This figure is only slightly higher than the 16 per cent figure in 2002.

The dataset employed in the study is the Comprehensive Labour Force Survey with samples of 33,000 households comprising of permanent residents and Singaporeans aged 25-54.

To isolate the size of the pay gap between genders, the researchers controlled for other variables such as education, age, occupation, working hours and industry into their statistical model. From this, the contributing shares of those variables are removed from the picture, leaving the result as the adjusted pay gap.

Over the years, labour market factors such as occupation, working hours and industry play a bigger role in affecting the gender pay gap.

The study concludes that “This suggests that despite women upgrading their occupations and improving their labour market attachment, gender differences in occupational wages had become larger due to occupation income growth favouring men.”

In particular, occupation is the largest determinant of pay gap in 2018, with 43 per cent of wage gap attributable to occupational differences. Comparatively, in 2002, occupation only explained 16 per cent of the variation in the wage gap, which was relatively lower. This shows the increasing importance of occupation as a factor that affects the gender pay gap.

A plausible explanation behind this could be because occupation segregation is stronger in 2018 than it was in 2002. More women work in lower-paying jobs whereas more men work in higher-paying jobs, according to the study.

On the flip side, it can also be argued that if occupational segregation has not changed much over the years, the salary in high-paying jobs could have increased more than the salary in low-paying jobs, thus broadening the pay gap.

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