The Pay Gap in China - Building Gender Balanced Business

The McKinsey Quarterly has posted an interview with the economists Li Bo and Chi Wei from China’s Tsinghua University on current conditions for women workers in China. They say that:

• The wage gap between men and women in unskilled factory labour has worsened for women since the transition to the market economy, as companies have more power to set their own pay schemes.
• Closures of factories following the economic recession will hit women hard. Men are more likely to benefit from government investment in construction because they dominate in that industry.
• Women factory workers often come from rural areas, beginning work at around the age of 16-17. They then work 10 hour days in repetitive assembly line work, for which they typically get paid less than men. They save money to contribute to their families and save for their dowry, often intending to go back to their villages to marry at about 24 years old. This short-lived working spell makes it unlikely they will see any career progression.
• China’s one child policy has helped women in work. Parents of one child will shower their resources on that child, so if it is a daughter they are likely to give her a good education. They will also want her to be a success, as she is the only child they have, countering old attitudes that regard women as inferior to men. In rural areas, however, the old attitudes persist. In part, this is because they are allowed to have two children if the first is a girl.
• The pay gap might narrow in the future as the supply of labour becomes scarcer (following the retirement of the older boomer generation).
• The best way to further the career prospects of a woman is to ensure she is well educated and prepared for the tough entrance exams to reach university. If she crosses this hurdle, she will be in as strong a position to compete as men at the same level.

Source: China’s ‘sticky floor’, McKinsey Global Institute, May 2009. More