Australia’s gender pay gap is costing $1.26 billion weekly in lost earnings. KPMG’s Dorothy Hisgrove explains workforce segregation and caring responsibilities drive the gap.
What’s happening: Australia’s gender pay gap is costing the economy an estimated $1.26 billion a week in equivalent earnings, based on new analysis of HILDA data by KPMG Australia.
Why this matters: Without committed action, the gender pay gap won’t close before 2054, affecting economic growth and workplace equality across all sectors.
The types of jobs women and men do, plus unequal distribution of hours spent on care, family and workforce participation between women and men have been found to be major contributing factors to Australia’s persistent gender pay gap.
The fifth edition of KPMG Australia’s She’s Price(d)less report, prepared with Diversity Council Australia and the Workplace Gender Equality Agency, offers fresh insights for employers, employees and policy makers on what is driving the persistent and pervasive gender pay gap.
The report identifies key drivers as unequal distribution of hours spent on care, family and workforce participation, as well as the types of jobs women and men engage in, known as workforce gender segregation.
Senior women hit hardest
The analysis found that as women’s level of responsibility in the workforce increased, they experienced a higher gender pay gap. Women experienced an 18% pay gap at higher income levels compared to little or no gender pay gap at the lower income levels.
The finding challenges assumptions about pay equity improving with seniority. Women in leadership and higher responsibility roles face significantly larger pay disparities than those in entry-level positions.
“KPMG’s report is unique because it looks beyond the numbers to identify underlying factors driving inequality between women and men at work,” says Dorothy Hisgrove, Head of People and Inclusion at KPMG. “This information is crucial to accelerate change by enabling more meaningful decision-making by employers and policy makers.”
The HILDA data also shows that in Australia, women were more likely to be employed on a casual basis or to be working reduced weekly hours, compared to men. Forty-eight per cent of all employed persons nationally were women, up slightly from 47.7% in August 2023. Women represented 66.5% of the part-time workforce, but just 39.8% of the full-time workforce.
Care drives 26% gap
Lower rates of pay in the occupations and industries where women were more likely to be employed accounted for 37% of the gender pay gap, according to the analysis. Gendered assumptions around workforce participation, for things like who should take parental leave and provide care for family members, was also a significant factor, accounting for 26% of the gap.
The remaining 55% of the gap was attributed to additional gender influences which include discrimination and other factors that are hard to control for statistically.
“The gender pay gap in this country remains persistent and pervasive, with the types of jobs women were employed in and the higher proportion of unpaid hours spent on household and caring responsibilities, the main contributing factors,” Hisgrove says.
The caring responsibilities factor extends beyond formal parental leave. Women continue to shoulder disproportionate responsibility for elder care, childcare coordination and household management, all of which affect workforce participation patterns and career progression.
“While this analysis does not capture the impact of recent and welcome government reforms to put gender pay gaps for individual employers on the public record, we hope to see insights on this in the future,” Hisgrove adds.
Industries show disparities
Healthcare and social assistance showed a $3.07 hourly wage gap, while education and training recorded $4.82, according to KPMG’s analysis. Retail trade showed a $2.31 gap, and manufacturing registered $4.44. Accommodation and food services showed a negative gap of $0.98, one of the few sectors where women earned slightly more on an hourly basis.
The industry variations reflect both workforce composition and historical pay structures within different sectors. Female-dominated industries like healthcare and education often show persistent gaps despite high female representation.
Catherine Hunter, Chief Executive of Diversity Council Australia, emphasises the complexity of addressing pay inequality.
“These findings illustrate stark disparities in economic outcomes, and pave the way toward understanding how closing the gender pay gap for all women will require us to recognise and respond to the intersecting drivers of inequality,” Hunter says.
“For culturally and racially marginalised women in particular, the barriers they face in the workplace are not shaped by gender alone. They are compounded and layered in ways that traditional frameworks have often failed to capture.”
Hunter’s comments highlight how pay transparency initiatives must account for intersecting forms of disadvantage beyond gender alone.
“This necessary work is not just up to policymakers or advocacy groups, it’s a responsibility that belongs to every employer, across every sector,” she adds.
Policy action needed
The report predicts that committed action is needed for Australia’s gender pay gap to close before 2054. Without intervention, current trends suggest more than 25 years before pay equality is achieved.
Mary Wooldridge, CEO of the Workplace Gender Equality Agency, says the findings send a clear message about the need to accelerate progress. “These findings send a message about the need to accelerate progress to close the gender pay gap,” Wooldridge says.
“Employers have an opportunity to drive productivity and meet employees’ expectations of a fair, safe and equal workplace by examining their own workforce data, finding areas of inequality, and taking evidence-informed action to address them.”
Wooldridge points to existing evidence about effective interventions. Organisations that systematically review pay data, address industry segregation and support flexible work arrangements show faster progress toward pay equity. “We know what works to improve fairness at work. Taking action to make that a reality can unlock significant economic growth for our nation, foster innovation and ensure we value all people at work,” she says.
Australia’s global ranking in women’s economic participation and opportunity improved from 70th in 2021 to 32nd in 2025, according to the World Economic Forum’s Global Gender Gap Report. However, the KPMG analysis suggests significant work remains to achieve full pay equity.
The report notes that years not working due to career interruptions contributed $0.87 to the gap in 2023, down from $0.98 in 2020. Working in male-dominated industries contributed $0.62, while female-dominated industries contributed $0.59. Additional gender influences, including discrimination and unmeasured factors, contributed $1.81 to the total $3.31 gap.
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