Has enterprise bargaining affected the gender wage gap in Australia?

Abstract

With the introduction of enterprise bargaining in 1991,decentralised wage determination in Australia was generally expected to widen the gender wage gap (see Chapter 3). However, as discussed in Chapter 4,the research that underlies this expectation is typically based upon aggregated data and suffers from a number of deficiencies. In contrast, this dissertation utilises unit record data from the extensive 1995 Australian Workplace Industrial Relations Survey (AWIRS95) commissioned by the former Department of Workplace Relations and Small Business to test the hypothesis that enterprise bargaining has affected the gender wage gap in Australia. Whilst the passing of four years between 1991 and the time of data collection may not have allowed for the landmark industrial relations change to have worked itself through the labour market, a noteworthy and major feature of AWIRS95 is that it identifies workers and workplaces operating under enterprise bargaining agreements, as well as containing a female/male split of the enterprise bargaining status (see Chapter 5). Along with hourly earnings data derived from AWIRS95,a clear assessment can be made of gender wage gaps for employees under enterprise bargaining and those not employed under enterprise bargaining. The thesis uses OLS earnings regressions to identify the part of any gender wag gap that can be justified by the difference in measured characteristics between males and females, as well as identifying the part that remains unexplained (see Chapter 7). Given the potential that workplace characteristics can affect the integrity of OLS results, a random effects model is also used (see Chapter 8). Interestingly, the OLS and random effects results are virtually identical (see Chapter 9). It needs to be noted that the component of the gender wage gap that is unable to be justified by direct statistical reference to the regression model has been attributed to discrimination in the labour market. However, this is something of a misnomer as the unjustified component also captures the impact of: model misspecification, including excluded variables; mismeasurement; and errors of calculation. Every effort has been made to reduce these effects. Nevertheless, there may be an element of discrimination in the regression model utilised in this thesis that is not discernible through the observable and measurable variables (see Chapter 3). Results of analysis undertaken in this thesis indicate that the gender gap,as well as the unexplained component thereof, are larger for employee data associated with enterprise bargaining than is the case for workers not so employed. Even so, the result is not deemed to be statistically significant, as is further supported by extensive sensitivity testing (see Chapters 7 and 8). Further research is needed to support the posed hypothesis. Nevertheless, the thesis still provides a wide range of interesting outcomes in providing a greater understanding of an observable gender wage gap in Australia, as well as the associated and contributing characteristics of employees and employers. It is in this capacity that the research work recorded in this thesis provides a new level of knowledge and understanding, particularly given the thorough use made of recent microdata and the observed earnings effects of selected variables. As a consequence, the results of this thesis will form a solid foundation upon which further gender wage gap debate, policy formulation and labour economics research can stand.

Date of Award	2000
Original language	English
Supervisor	Ann Harding (Supervisor) & Anne Daly (Supervisor)