Gender pay gap still narrowing

© Hollandse Hoogte
In 2019, the wage gap between men and women narrowed further in the Netherlands. Women’s average gross hourly earnings were 14 percent lower than men’s. This percentage is becoming smaller every year. Today, Statistics Netherlands (CBS) released a publication on the 2019 labour market. It not only focuses on the difference between average hourly wages, as is customary, but also looks at other ways of measuring the gender pay gap. Based on the average or median net hourly wage, it turns out that women are even better off than men.

In 2019, women’s average annual earnings - including special bonuses - were 38 percent lower than men’s. Two-thirds of the wage difference can be explained by the fact that women work fewer hours. Male salary workers spend an average of 33 hours per week at their jobs, while their female peers work an average of 25 hours per week. The difference in hourly earnings is therefore much smaller: average hourly wages of women were 14 percent lower than those of men’s.

The 14-percent gap can be explained as well; by the different composition in the groups of male and female employees, for example. This further adjustment for background characteristics has not been applied in this analysis.

Average hourly pay gap shrinking

Over time, the difference in average hourly wages has become progressively minor. One factor is that, nowadays, female workers are higher educated than their male counterparts. This is most commonly the case among employees under the age of 45. One decade ago, the age threshold was still 35 years. Partly as a result of this, the average hourly wage gap between men and women has decreased from 20 to 14 percent in the span of a decade. As of 1995, the gender wage gap has become narrower, by 0.5 percentage points per year.

Median hourly wage gap smaller than average hourly wage gap

The pay gap between men and women based on average hourly earnings presents a somewhat distorted view since wages of highly-paid male employees weigh in heavily.

A more balanced picture can be obtained by looking at median hourly wages. The median is the value in the middle of a sorted ascending list of numbers. Last year, based on average hourly wages, women earned on average 14 percent less than men; but 7 percent less based on median hourly pay.

The gender gap becomes apparent in jobs with hourly wages of 30 euros, in which men are over-represented in terms of wage distribution. One-quarter of all working hours of men pay an hourly rate of at least 30 euros, while this share is 14 percent among women. In five out of six jobs, hourly earnings are less than 30 euros. These jobs have virtually equal hourly wages for men and women. The fact that average hourly wages among female workers are lower than among male workers can thus be explained by an over-representation of men in higher-paid jobs.

Distribution of wages1), 2019
UurloonMen (%)Women (%)
00.30.1
10.20.2
20.40.7
30.40.7
40.40.5
50.50.6
60.70.8
70.70.7
80.60.6
90.70.7
101.21.2
113.03.6
123.95.2
133.95.2
144.15.6
154.14.8
164.34.8
174.64.5
185.04.3
194.54.7
204.35.2
214.05.3
223.74.2
233.54.1
243.43.6
253.13.1
262.83.1
272.52.5
282.32.7
292.12.2
302.01.9
311.81.7
321.61.1
331.51.0
341.30.9
351.51.1
361.20.7
371.00.6
380.90.5
391.00.5
401.00.6
410.80.4
420.70.3
430.60.3
440.50.2
450.60.3
460.50.2
470.40.2
480.40.1
490.40.1
500.30.1
1) The chart displays the relative distribution of hourly wages among men and women, based on the number of working hours. For example, 5 percent of all working hours among men are paid at 18 euros per hour.

Median net hourly wage higher among women than men

Finally, instead of looking at gross wages and salaries, net earnings can be considered as well. In 2019, women’s median net hourly wages were 2 percent higher than men’s: 50 percent of men’s working hours were paid at a net hourly wage of no more than 16.64 euros, while 50 percent of women’s working hours were paid at a net hourly wage of no less than 16.95 euros.

The fact that women do relatively better in terms of net wages is due to the fact that higher-paid jobs are relatively more heavily taxed. Men are over-represented in higher-paid job and therefore pay a relatively larger share of wage taxes and social insurance contributions. Since 2015, women’s median net hourly earnings have been higher than men’s.

Women's wages as a percentage of men's wages
JaarAverage annual wages (%)Average hourly wages (%)Median hourly wages (%)Median net hourly wages (%)
'0654.878.885.194.1
'0755.279.385.994.7
'0856.179.886.394.8
'0956.880.386.894.6
'1057.081.388.296.3
'1157.181.588.696.9
'1257.882.289.797.4
'1358.183.491.097.9
'1458.983.991.699.4
'1559.384.092.3100.2
'1660.384.592.5101.7
'1761.085.093.0102.3
'1861.885.393.0102.2
'1962.585.793.0101.9

The results over 2019 included in this news release are still provisional.

Sources