Research examines factors leading to pay disparities

Research published in 2008 by the National Institute of Statistics examines differences in net hourly pay between employees in terms of their personal characteristics and the nature of their employer. It finds that, in 2006, average net hourly pay in Romania stood at €1.45, with women earning 93% of the male average. Factors such as education, age, working time and length of service also affected pay; further differences emerged according to sector and company size.

About the survey

Every four years, the National Institute of Statistics (Institutul Naţional de Statistică, INS) conducts a study on salary earnings in the month of October in the reference year. The latest survey, covering companies employing at least 10 workers, was published in 2008, entitled Salary disparities and their causes, 2006.

The data are clustered by various criteria: demographic and socioeconomic features (gender and age groups), educational level, sector, occupational category, length of service, length and type of working schedule, and company size and ownership. The publication provides comparable data at European Union level.

Main survey findings

Of the approximately 4.47 million employees considered by the survey:

  • 4.4 million were full-time employees;
  • 2.99 million were working in the private sector;
  • 1.56 million were working in companies employing over 1,000 personnel;
  • 311,000 were aged below 24 years;
  • 632,000 had worked for less than one year in their current company.

Influence of employee characteristics

The average net hourly pay for all employees on record in October 2006 was €1.45, standing at €1.50 for men and €1.40 for women (Table 1). Women earn on average 93% of average male hourly net earnings.

The highest average hourly pay was earned by men holding postgraduate qualifications and doctorates (€4.15) and the lowest pay was earned by men with only pre-primary education (€0.69). Women who have pre-primary education, women aged 55–64 years and women with less than one year’s service in the same company earn, on average, more than their male counterparts.

Table 1: Average net hourly pay, October 2006, by individual employee characteristics (€*)
  Total Men Women
Total employees 1.45 1.50 1.40
Level of education
Pre-primary 0.71 0.69 0.72
Postgraduate 3.97 4.15 3.72
Age group
15–24 years 0.95 0.95 0.94
55–64 years 1.89 1.88 1.92
Length of service
Under one year 1.10 1.09 1.10
30–39 years 1.85 1.90 1.78

Note: * The euro values in both tables are own calculations based on the average exchange rate for October 2006: €1 = RON 3.1592.

Source: INS, ‘Salary disparities and their causes, 2006’, Bucharest, 2008

Effect of company characteristics

The data reveal that the highest average net hourly pay was earned in enterprises belonging to the public sector (€1.80), and in companies with 1,000 employees or more (€1.81); 1.48 million employees are in this situation (Table 2). The lowest average net hourly pay was earned in companies with 10 to 49 employees (€0.99); 720,000 persons are in this situation.

On average, men earned more than women regardless of company ownership and company size. However, in terms of working hours, part-time working women earned more on average than their male counterparts: €1.36 for women compared with €1.28 for men.

Table 2: Average net hourly pay in October 2006, by company characteristics (€)
  Total Men Women
Total employees 1.45 1.50 1.40
Ownership
Public 1.80 1.88 1.73
Private 1.28 1.35 1.19
Company size
10–49 employees 0.99 1.03 0.93
1,000 employees or more 1.81 1.92 1.71
Working hours
Full time 1.45 1.50 1.40
Part time 1.33 1.28 1.36

Source: INS, 2008

Commentary

In addition to the general finding that net hourly earnings in Romania remain extremely modest compared with those in the ‘old’ EU Member States, it is also notable that part-time workers earn the least in overall terms. They are disadvantaged both by the low hourly pay and by their shorter length of work. This may be due to lack of regard for part-time work, which undermines acceptance of the concept of flexicurity in Romania.

A printable version of the study is available in the Romanian language.

Constantin Ciutacu, Institute of National Economy, Romanian Academy

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