Company profits: what impact do they have on wage gaps between women and men ?
Between 1999 and 2016, women in the Belgian private sector earned, on average, 15.6% less than men. To what extent is this gap linked to the profits generated by companies?
To answer this question, the researchers analysed data from more than 600,000 Belgian workers, taking into account numerous factors such as education level, seniority, position held and company characteristics.
A broadly comparable sharing of profits
The study shows that, for comparable characteristics, Belgian companies redistribute their profits in a similar way to women and men. When a company doubles its profits, wages increase by an average of 2.8%, with no statistically significant difference between the two sexes.
“Our results show that wage gaps between women and men are explained more by worker characteristics and their distribution across companies than by a difference in how profits are shared,” explains Alexandre Waroquier, researcher at the Department of Economics at UMONS.*
Gaps that can be explained in other ways
The study shows that workers with higher levels of education, greater experience or management positions benefit more from the sharing of profits. Finally, when wages are negotiated at company level, men appear to benefit more from this redistribution than women.
The researchers nevertheless observe that women more frequently work in less profitable companies. This distribution contributes, on average, to reducing the amount of profits that is reflected in wages, even when the sharing mechanisms are comparable.
Lastly, the researchers put forward one possible explanation: this different distribution of women and men across more or less profitable companies could in particular be linked to career paths influenced by the still unequal sharing of family responsibilities.
*This study, published in the scientific journal De Economist, is the result of a collaboration between Kevin Pineda-Hernández and François Rycx, from the Université libre de Bruxelles, and Mélanie Volral and Alexandre Waroquier, from the Department of Economics at UMONS.
