Gender pay gap: In Australian finance, the male-female salary disparity is not going away

Around the office towers of Melbourne, Sydney, Brisbane and Perth, there’s a common complaint during recruiting season for investment banks: where are all the promising women?

The top female students in finance, law, engineering and economics are in such great demand that even the titans of finance struggle to attract them. Private equity, with the prospect discovering the next Google, is often more attractive. Or management consulting, where partners promise to unleash these idealists on the great institutions of state and capitalism.

Hiring women barely out of their teens is desperately important for investment banks. When they can, many employ more women than men. Because they know, through experience, most will succumb to an easier path in life than banking’s long and lucrative grind.

Then one day, as happened this week, they will be held accountable for what’s called the “gender pay gap” but is really a professional gender shortfall in the executive ranks.

Wide, persistent, explicable

On Monday, the Workplace Gender Equality Agency published its annual calculation of the difference between male and female pay. The report covers the whole economy, making it hard to generalise on the underlying causes of men’s 22 per cent advantage.

But finance is a place where the gap is wide, persistent and explicable. Investment banks, a subset of the industry, unfortunately have distinct characteristics that lead most women to leave long before they come within sight of the CEO’s office.

“It’s a brutal, brutal job,” one former CEO told me this week. “It’s very hard to manage your life with that job.”

In finance and insurance women make up only 36 per cent of the top-paid quartile (the top quarter), according to the Workplace Gender Equality Agency.

Men need lives

Equal pay has been required by the law in Australia for 50 years, and no informed person argues investment banks pay men more for the same work as women. No doubt they did once, in the era when strip clubs were an acceptable after-work social activity.

Today, out of respect for basic fairness, and a fear of public shaming, investment banks seek out female employees like gold dust.

The seven-day weeks take their toll, though, and banks struggle to keep their female staff. Many go on to rewarding careers elsewhere, which also give them the time to raise children. Mixing in the upper level of society, some choose never to work again. Those who stay often have a non-working partner to keep their home life organised.

Should male bankers spend more time with their offspring? Of course. Will they? To do so would concede weakness to their male colleagues. Is this admirable? Of course not. As the journalist Annabel Crabb once wrote: “Women need wives and men need lives.”

The ex-CEO asked, rhetorically, if regular working hours could be imposed on banking workplaces. He concluded, regretfully, it is probably impossible: “As long as the competitors keep fighting as hard as they do, that has to be the case.”