Understanding the Gender Wage Gap

This article is a summary on Laxmi Kandel’s master thesis “Wage Difference in Gender: A Comparative Study”. Gender wage gap is the difference of income earned between men and women performing similar work. Gender pay gap is a measurable indicator of inequality between women and men (ILO, 2019 p68). Wage disparity between genders remains a pressing global issue, with its causes and consequences varying significantly across nations due to cultural, economic and policy-related factors. This often results from a combination of direct and indirect discrimination, occupational segregation, and unequal access to career advancement opportunities. The gender wage gaps are caused by deep-rooted social norms about gender roles, the undervaluing of women’s work, and obstacles preventing women from entering higher-paying jobs typically dominated by men. (ActionAid, 2024). Globally women earn approximately 33% less than men on average that persists across different regions and industries (The World Bank, 2024).

TEXT | Laxmi Kandel and Thomas Sabel
Permalink http://urn.fi/URN:NBN:fi-fe2025060962984
A seesaw with two wooden blocks on either end. The left block, marked with a male gender symbol, is supported by a tall stack of coins and sits lower. The right block, marked with a female gender symbol, is supported by a shorter stack of coins and sits higher, illustrating a gender pay gap.

In Nepal, the gender pay gap is 33% while in women in Finland earn 16% less than men. The labour market of Nepal is characterized by traditional gender roles which are primarily responsible for household chores and caregiving which leads to difficulty in balancing work and family life. In contrast, Finland is known for its strong and progressive work-life balance policies and family support system.

Methodology

This research is conducted in a mixed method. Quantitative data are collected from labor statistics while interview method is utilized for collecting for qualitative data. The participants of interviews are from various sectors and backgrounds like healthcare, education, agriculture, business and administrative jobs.  This wide range of participation provide holistic understanding of how job roles, experience and career progression affects wages in workplace.

The research is based on the foundation of four theories i.e. Human Capital Theory, Gender Role Theory, Discrimination Theory and Motherhood Penalty Theory. These theories provide insights into how wages are affected by disparities in education, social expectations, organizational structures and family obligations.

Key Findings

  • Supportive Co-worker: Most of the women reported that the co-worker are supportive.  They find the male mentor are supportive, eager to teach in the workplace and are very helpful in building networking among staffs.
  • Supportive Policies but ineffective implementation: In Nepal, many companies formulated gender based policies. But they are weak in enforcement during hiring process, promotion, increment in salary and overall workplace opportunities. A total of 88% of the respondents shared their experience in gender based discrimination either in hiring, promotion or workplace. One of the respondents shared her experience how she was bypassed for senior role job despite of her education and qualification.
  • Critical in Transparency: A major challenge Nepalese women are facing in their workplace is in negotiating in salary. Due to the cultural norms, lack of transparency and fear of job loss are the reasons that women hesitate to negotiate their salary even if they find unequal salary payment for same job roles.
  • Cultural Attitude: In Nepal, societal and cultural norms prioritize family responsibilities over career progressions. This hinders the capacity of women to pursue education or higher paying jobs. Majority of the participant shared their views that their professional and personal decisions are influenced by family members or family structure. This shows that the society is under influence of deep rooted cultural thinking.
  • Motherhood and Career: In Nepal, motherhood penalty remains major barrier for women unstoppable professional progression and career advancement. They are forced to leave the job or extend their unpaid leave due to inflexible working hours and lack of maternity benefits.

Lesson learned from Finland

Nepal and other developing and least-developed countries can learn from Finland’s progress in reducing the gender wage gap.

  • Effective Policy Implementation: Nepal can be an example with lots of policies of commitments in paper and lack in enforcement. Only laws are not enough. To ensure equality in real world, effective monitoring, regular pay audit and accountability are essential to eradicate wage gap.
  • Transparency: A transparent salary scale and regular reviews of wage disparity is essential in both public and private organization. By allowing to request and mandatory provision to provide such requested information also helps to reduce trust among employees and organization.
  • Childcare facilities: Affordable childcare, shared parental leave, and childcare facilities in organization help women to work flexible and efficiently in workplace which increases productivity as well.
  • Change in attitude: The progress of gender equality comes not only from strict legal frameworks but also from cultural shifts. Equal opportunities to education, media, public campaign, trainings and mentorship programs are the key factors to change the attitude of people.

Advice for Next Generation

The process of empowering the next generation of women begins with fostering knowledge and confidence. A real change can be experienced with awareness and is sustained through action. Many respondents emphasized that on skills development, educate themselves, participate in different professional networking events and participate in different trainings can make the change. One of the respondent responded as:

“My advice to young women entering the workforce is to embrace confidence in their skills and potential. Don’t be afraid to negotiate for what you deserve, whether it’s in terms of salary, benefits, or career growth opportunities. Be open to learning and growing, but also know when to set boundaries to maintain a healthy work-life balance. Above all, trust your instincts and don’t let gender biases hold you back your voice matters, and your contributions are valuable. Stay resilient and keep pushing for the opportunities and recognition you deserve.”

References
  • ILO. 2019. The Business case for change. Women in Business and Management. https://www.ilo.org/sites/default/files/wcmsp5/groups/public/@dgreports/@dcomm/@publ/documents/publication/wcms_700953.pdf

  • ActionAid UK. 2024. The gender pay gap. https://www.actionaid.org.uk/our-work/womens-economic-rights/gender-pay-gap

  • World Bank Group. (2024). Women, Business And The Law 2024. The World Bank https://documents1.worldbank.org/curated/en/099110624115537381/pdf/P1677921e884b70871a4161b44e57ac5a89.pdf

  • Kandel, Laxmi 2025. Wage Difference In Gender: A Comparative Study. https://www.theseus.fi/handle/10024/883846

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