Efforts to narrow the
gender pay gap have not been effective
Helsinki (08.03.2011 - Juhani Artto) A number of influential people have
recently voiced alarm at how slowly the gender pay gap in Finland is being
narrowed. Among them have been Leila Kostiainen, the Secretary General of
the Finnish Confederation of Professionals STTK and Pentti Arajärvi, a
professor who has, since 2009, headed the high-level group monitoring the
implementation of the government's equal pay programme.
In 2006 the government and the central labour market organizations approved
as their common goal to raise, by 2015, women's pay to 85 per cent of men's
pay. Back then, in 2006, women earned, on average, 80.9 per cent of what men
Three years later - in 2009 - the gap was almost as wide. The women's euro
had grown to 81.8 cents. The trend is not promising as the improvement over
the last three years has been marginal to say the least. The gap has not
narrowed more or even reached the same level as the early 2000's show when
figures show that the women's euro was 82 cents.
This is disappointing as in the course of these years many kinds of genuine
efforts have been made to narrow the gender pay gap and also as there has
been no principal opposition to it.
The figures express women's average pay as percentage of men's average pay
in respect of their regular working hour work. In the total earnings
calculation women earn, on average, 70 per cent of men's average earnings.
In the following the major issues and factors, connected to the gender pay
gap in Finland, are briefly outlined.
The Finnish labour market is divided more deeply along the lines of women's
verses men's vocations than in most other European countries. Women tend to
work in sectors and vocations that belong to the low-pay categories.
Typically it means work in the service sectors, in social and health care
and in local government jobs.
Women and men have been encouraged to choose careers that differ from the
traditional choices but the traditional pattern - segregation - has
prevailed. In recent years more women have turned to "men's vocations" than
men to "women's vocations".
Among the factors causing the persistent gender pay gap this kind of
segregation is the most important factor.
Pay system reforms, family leaves
A certain degree of expectation has been placed on pay system reforms. The
goal here has been to make visible how demanding various jobs are and to
ensure equal pay for jobs that are equally demanding. This approach should
overcome subjective appreciation of various jobs and provide fairness or
‘fair-play’ to all wage and salary earners.
A new study (English language abstract on page 5)
indicates that pay system reforms have in practice had a positive impact.
"However, this positive outcome does not apply to all employees. The gender
pay gap has narrowed most considerably at the upper end of the pay scale,
that is, among the highest paid or among those performing the most demanding
Pay system reforms seem also to have had a negative impact on the gender pay
gap, the researchers discovered. "The reforms of pay systems have, on the
other hand, not succeeded in reducing the major impact on job task
segregation across genders on the average male-female pay gap. Instead, the
situation seems to have even worsened for at least certain employee
The study also confirmed results of previous studies on the impact of family
leaves. Especially after return from longer family leaves the pay
development for mothers with young children has remained weaker than the pay
development for other women.
Gender equality plans, pay surveys
The Act on Equality between Women and Men obliges work places with 30
employees or more to create an equality plan which includes a pay
survey. The purpose of these obligations is to produce concrete data on
eventual gender inequality with a view to abolishing gender based pay
According to a study (English language abstract on pages 7-8),
published in March 2010, this idea has not led to significant
changes. The research material concerns the years 2008-2009.
Awareness of the obligations is rather high, as over 90 per cent of all work
places concerned knew about them but more than a third of work places had
not yet produced equality plans. More important still may be the following
conclusion made by the researchers. "The quality of equality plans, however,
still leaves some room for improvement: the measures included in the plans
are not always concrete and there are cases where no agreements have been
reached on how to follow up the measures."
Also the results of pay surveys have remained modest, the study indicates.
"It is likely that some of the surveys focused merely on studying the
salaries, instead of comparing them as part of the process of equality
planning." Pay surveys had been conducted in 60 per cent of work places with
30 employees or more.
"The respondents found it challenging to name any concrete effects that have
come out of equality plans. A majority estimated, however, that the equality
plan has had some positive effects. It turned out that equality plans have
had most impact in two important areas: reconciliation of work and family
life and in lessening harassment and discrimination."
Women see less progress having happened than men
Opinions on the way in which gender equality is accomplished at work
places have been surveyed in 1997, 2003 and 2008. Apprehensions on the
gender equality of both sexes have become more positive but there is a clear
distinction between the development of men's and women's opinions.
In 1997 a quarter of both sexes judged the accomplishment as "fairly well".
In 2003 this proportion had risen to 27 per cent among women cent and to
33 per cent among men, and by 2008 the difference had grown still larger.
The "fairly well" provision among women was 30 per cent and among men 40 per
The differentiation of opinions is significant as it also has an impact on
how much pressure there is at work places for a change in women's status. No
credible explanations have been offered on why opinions are differentiated
in this way.
In October 2010 the government approved a report on gender equality and
submitted it for parliamentary consideration. It was the first time this
happened in Finland. The 214-page report only briefly addresses the gender
pay gap question and efforts to narrow it. The EUR150 million allocated by
the government to support pay rises in collective agreements at
female-dominated sectors in the municipalities is mentioned.
Collective bargaining, labour market organizations
An overwhelming majority of wage and salary earners in Finland are covered
by collective agreements. Thus, the labour market organizations have a
central role in the development of the gender pay gap. Employer
organizations have not shown any interest on narrowing the gap. It has been
the unions that have fought for narrower gender pay gap.
In the past the comprehensive income-policy agreements often included a
modest extra provision to improve women's wages and salaries. In recent
years two interesting phenomena can be registered. In the female-dominated
municipal sector the agreements have yielded slightly higher rises than the
agreements in general. And the other phenomenon: In Autumn 2007 the
largest union in the also female-dominated health care sector TEHY
succeeded in struggling for pay rises that exceeded those in other sectors
of working life.
"Not in the discussions on labour market policy"
On 14 January 2011 Leila Kostiainen, the Secretary General of the Finnish
Confederation of Professionals STTK, stated in her interview in the weekly
magazine Suomen Kuvalehti the following: "The gap between women's and men's
pay is in no way handled in the discussion on labour market policies."
According to Kostiainen interest in the issue from politicians has faded.
Stefan Wallin, the minister responsible for equality issues, has done his
best but he has been left without any real support, Kostiainen notes
In the interview she admits that the slower than expected progress is not
caused by the employers only. The trade union movement has also approved
solutions that have slowed down the development or even turned it back.
Should male-dominated unions then scale down their own demands for the
benefit of others, the magazine asks.
"No, there is no need for them to scale down their own demands, but they
must learn to tolerate better agreements made by female-dominated unions",