Part-time work and parental leave widen gender pay gap

The gender pay gap, widely discussed in Germany, has been calculated at 28% in 2006. Further analyses, however, reveal that the difference between the hourly wages of female and male employees decreases to 6% when circumstances such as economic sector and occupation, job tenure, skills level, working time and parental leave are factored in. Investment in childcare facilities could reduce the pay gap, by enabling women to return to work and to work full time.

On 9 June 2008, in the daily newspaper Die Welt, the European Commissioner for Employment, Social Affairs and Equal Opportunities, Vladimír Špidla, criticised the fact that the hourly wages of female employees fell notably short of the corresponding wages for male workers in Germany. According to a study on the Gender wage gap and family policy (in German, 125Kb PDF) by the Cologne Institute for Economic Research (Institut der deutschen Wirtschaft Köln, IW Köln), published on 29 May 2008, the average difference in hourly wages amounted to a gender pay gap of 28% in 2006. However, the study also showed that this simple comparison ignores the fact that women and men vary significantly in their labour force participation patterns.

Gender differences in employment

The distribution of female workers across occupations and economic sectors differs from that of male employees. The sector employing the largest segment of the male workforce is manufacturing (26.7%), while female employment is primarily concentrated in services sectors, such as health and social work, education and industrial cleaning (44.9% of all female employees).

Furthermore, in 2006, only 26.3% of all female workers held a university degree or comparable educational qualification. This proportion was significantly lower than that for male employees, amounting to 34.2%.

Moreover, a greater proportion of female employees work part time (37.2% in comparison with 4.4% for men) or in ‘marginal’ or ‘fringe’ jobs (16.6% compared with 5%) than do their male counterparts. Marginal jobs (geringfügige Beschäftigung) are thus described because they consist of less than 15 working hours a week and may be considered on the margins or fringes of employment (DE0611019I). Women with children are particularly likely to be involved in such forms of atypical work: the corresponding quotas are 54.5% for part-time work and 21.2% for fringe jobs.

Finally, only a very small minority (3.4%) of male employees with children interrupt their careers to raise their offspring. By contrast, almost every female worker with at least one child (94%) has taken parental leave.

Wage differences determined by different work patterns

The bulk of the gender pay gap can be explained by the different patterns of labour force participation of female and male employees (see table). Working part time or taking on a fringe job reduces the hourly wage by 18% and 47% respectively, compared with a full-time job. Although this holds generally for both women and men, the former are more often affected. Due to more frequent as well as longer career interruptions for child-raising, female workers cannot benefit from skill, experience and job tenure premiums to the same extent as male employees.