Widest Gender Pay Gap in OECD Set to Worsen With Pandemic


South Korea has long lagged other developed countries in promoting equal pay between women and men, and the small progress it has made in recent years is facing a setback as the Covid-19 shock disproportionately hits female workers.

South Korean women took home 32.5% less income than men last year -- the widest pay gap among 37 member countries in the Organisation for Economic Co-operation and Development, where the average gap is 13%. The disparity risks getting worse this year. Women account for two thirds of the country’s job losses since March as the pandemic hits service-sector and non-regular jobs, where women vastly outnumber men.

Some have held on to their jobs but suffered wage cuts, such as Park Myeong-soon, a 64-old female cleaner at a university in the South Korean city of Incheon. The virus outbreak has meant fewer in-person classes and rotation shifts to reduce infection risk among the cleaners. This has brought less work and reduced pay for Park.

“This is a big problem for people like me who live paycheck to paycheck,” she said by phone. “It is the most stressful time and I fear this Covid situation is going to last longer.”

Widest Gender Pay Gap in OECD Set to Worsen With Pandemic

The vulnerability of female workers amid the pandemic is not unique to South Korea. The situation isn’t much better in Japan, where women have accounted for a majority of the jobs lost since the outbreak, while also bearing the burden of rearing homebound children. In the U.S., this crisis has been described as a “shecession” for its greater impact on women.

Yet it’s particularly painful for South Korea, which had been making headway in attracting more women into the workforce by promoting policies such as flexible work hours and paid parental leave.

The government uses a name-and-shame strategy to disclose companies that continue to employ women notably less than the industry average and offers subsidies to firms seeking to hire women coming back after a career break.

Before the pandemic struck, women had outpaced male jobs gains since 2015. The gender pay gap had narrowed from 37.2% over the same period.

Worse Jobs

It remains uncertain whether the jobs women lost will be restored as the economy recovers, with Covid-19 reshaping the way businesses operate.

“Women are the first to take a hit when there’s an economic crisis from the Asian financial crisis to Covid-19,” Bae Eun-kyung, a sociology professor at Seoul National University, said at a forum this month. “And when the jobs situation improves, women again end up taking worse jobs than men.”

Widest Gender Pay Gap in OECD Set to Worsen With Pandemic

The OECD said in its South Korea economic survey in August that the Covid-19 crisis is exacerbating the country’s inequalities. It suggested the government regularly publish its analysis of wages outcomes to achieve fairer pay across genders.

The collapse in female jobs in South Korea is due their outsized presence in face-to-face service positions, as well as in non-regular positions more prone to lay-offs. Around 31% of the country’s female workers held services or sales jobs last year, almost double the share of men.

Even among those holding similar jobs -- like Park the cleaner and her male co-workers -- the common gender division of labor has impacted her female colleagues more as the virus rages.

Park said in her university, men worked outside, cleaning parking lots and lawns, while women mostly cleaned indoor bathrooms and classrooms. She said this has meant men were saved from being split into rotation groups to reduce infection risk and experienced no wage cut.

Government Policy

South Korea’s gender situation lags its status as the home to some of the world’s most advanced companies, such as Samsung Electronics Co. and SK Hynix Inc.

The gap remains wide in leadership positions. The share of women holding managerial posts in state-funded and large private companies was 19.8% last year, down from 20.6% in 2018, statistics office data show. South Korean women hold just 19% of assembly seats, below the global average of 25% in data compiled by the Inter-Parliamentary Union.

Much of the government’s stimulus this year, including the proposed fourth extra budget, has focused on protecting vulnerable jobs and workers, but hasn’t done much in resolving gender inequality.

“Governments may provide support for each sector but they find it difficult to do so for a specific gender, because job choices were individual,” said Joseph Han, an economist at the Korea Development Institute.

©2020 Bloomberg L.P.

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