What’s driving the gender pay gap

By Staff | March 7, 2019 | Last updated on March 7, 2019
2 min read
A miniature woman standing in a pile of low coins and a miniature man standing in a pile of tall coins.
© Hyejin Kang / 123RF Stock Photo

The stark under-representation of women among very high earners in Canada is one of the key reasons for the persistent pay gap between men and women, new research suggests.

According to a study from Statistics Canada released Thursday, men outnumber women by a ratio of seven to one among the top 0.1% of earners in Canada (those who make more than $761,000 annually), and by five to one among the rest of the top 1% (those who make $238,000 to $761,000 annually). Among the next 9% (those who make $104,000 to less than $238,000), men continue to outnumber women by three to one. Conversely, women represent just over half of earners in the remaining 90% of Canadian workers (those who make less than $104,000).

This vast disparity at the very top of the pay distribution points to a key reason why the gender pay gap (the overall gender ratio in annual earnings) has remained stuck at about 69% since 2009, after rising from 54% back in 1978.

“The slowdown in the progress in the overall gender ratio is consistent with a ‘swimming upstream’ effect of increases in top incomes,” the research says, noting that progress “stalled in periods of faster increases in top incomes, such as the 1990s, but accelerated following the global financial crisis in 2008-2009, which hit top earners harder.”

StatsCan reports that a simulation, which projects how the gender pay gap would look if women’s representation in top earnings groups had been the same as men, finds that the ratio would have risen from 69% to 88% under these conditions.

“This suggests that the under-representation of women among top earners accounted for 61% of the gender earnings gap,” it says.

“With increasing earnings inequality in top incomes, further improvements in the representation of women among top earners will likely be necessary for the continued decline in the gender earnings gap in the 21st century,” the report concludes.

Advisor.ca staff


The staff of Advisor.ca have been covering news for financial advisors since 1998.