Karina Doorley - How has gender income inequality in Ireland and the UK changed in the last decade and why?

  • Presenting author: Karina Doorley (ESRI)

  • Authors: Silvia Avram, Karina Doorley, Claire Keane, Daria Popova

  • Session: A02A - Dynamic / Long term [1] - Monday 16:30-18:00 - Ceremonial Hall

  • Slides: PDF

The gender gap in income is large and well documented across Europe. Previous research has shown its composition, distinguishing between gender gaps in wages, in work patterns and in redistribution by the tax and welfare system (Figari, Immervoll, Levy, & Sutherland, 2011; Avram & Popova, 2020; Doorley & Keane, 2020). There is extensive research on the evolution of the gender wage and the gender work gap over time - these have been closing in many countries. However, there is less evidence of how redistribution between men and women by the tax-benefit system has changed over time. While redistribution between men and women decreases gender income inequality, it can also exacerbate the gender income gap at source by disincentivising female labour market attachment. The cumulative impact of developments in gender wage and work gaps and their interaction with the tax and welfare system has not been examined in a historical context. This research investigates how the gender gap in income has changed over time in Ireland and the UK, neighbouring countries with different histories of gender segregation and legislative pushes for gender equality. Our study period encompasses the years 2008-2019, taking in the effect of the financial crisis, which increased female labour supply compared to male but which was also associated with strong austerity measures, with differing impacts for men and women. Using microsimulation models for the two countries (UKMOD and SWITCH), we document the gender income gap between 2008 and 2019 by income decile. We decompose the total gender income gap in each time period into the relative contributions of gender gaps in work (including self-employment), wages and demographics. We also show how the cushioning effect of the tax and welfare system on the gender income gap has changed over time. Our results have implications for policy makers interested in balancing the objectives of gender budgeting with maintaining incentives for gender equality in the labour market.