The gender pay gap is narrowing, so why does it still feel like such a big issue?

New Zealand’s gender pay gap has narrowed over the past decade, but the headline improvement does not tell the full story. While the overall figures suggest progress, the lived experience for many women shows that pay inequality is still shaping careers, earnings, and long term financial security in very real ways. A smaller gap on paper does not always mean workplaces have become fairer.

What makes this issue more pressing is how the gap develops over time. It is often less visible at the beginning of a career, then becomes more pronounced as responsibilities, promotions, and opportunities begin to diverge. This points to a deeper structural problem. The challenge is no longer simply about getting women into the workforce. It is about what happens once they are there, how talent is rewarded, and whether the systems inside organisations are genuinely equitable.

For employers, this creates an important moment of reflection. If the gap is not primarily being driven by qualifications, ambition, or capability, then attention must turn to workplace practices themselves. Hiring decisions, promotion pathways, flexibility, and assumptions about care responsibilities all play a role in shaping outcomes. That means employers have more power to influence change than they may realise.

“It is actually about what is happening in our firms and the choices that are being made.”

On a recent NZ Market Update, Host Shannon Barlow, NZ Managing Director, was joined by Guest Jo Cribb, Project Leader from Still Minding the Gap, to unpack why New Zealand’s gender pay gap remains such a persistent challenge despite years of apparent progress.

A key point raised in the discussion was that the current gap can no longer be easily explained by traditional assumptions. Women are highly qualified, increasingly represented in professional careers, and continue to aspire to leadership. In many cases, they are entering the workforce with strong credentials and clear ambition. Yet the gap continues, which suggests the issue lies less in women’s choices and more in the systems and behaviours operating within organisations.

That is where the conversation becomes more uncomfortable, but also more useful. Jo explained that much of the remaining pay gap comes down to firm level decisions. Who is offered progression opportunities, who is assumed to be ready for leadership, who gets access to stretch assignments, and who is quietly overlooked all influence earnings over time. Even where discrimination is not intentional, unconscious bias can shape career outcomes in ways that accumulate year after year.

The discussion also highlighted how assumptions around caring responsibilities continue to affect women’s careers. Employers may believe they are being supportive by lightening workloads or steering women away from high pressure opportunities after they return from parental leave. Yet these decisions can have the opposite effect, limiting visibility, development, and promotion prospects. The issue is not always overt exclusion. Often, it is a pattern of well meaning decisions that still create unequal outcomes.

Importantly, the conversation moved beyond diagnosis and into action. One of the strongest levers identified was pay transparency. When organisations are required to report on pay gaps, they are far more likely to examine their data, understand the causes, and take steps to address them. Transparency creates accountability, but it also creates momentum. It encourages employers to review policies, rethink outdated assumptions, and build more equitable pathways for progression.

Examples from overseas were used to show what this can look like in practice. Where reporting requirements are in place, employers are often pushed to scrutinise their people policies more closely, from flexible working arrangements to promotion criteria and talent retention strategies. The result is not only greater fairness, but often stronger employee engagement and a more attractive employer brand. In other words, tackling the gender pay gap is not just a social issue. It is also a business issue.

The wider point was clear. Real progress is not simply about reducing the annual pay gap figure. It is about improving outcomes across an entire career and into retirement. Lower pay today affects savings, financial stability, and long term independence tomorrow. If inequities continue unchecked, they do not disappear. They compound. For employers, this makes action both urgent and practical. Fairer workplaces make better use of talent, create stronger cultures, and support more sustainable growth.

What can employers do now to close the gender pay gap more meaningfully?

• Audit pay data regularly to understand where gaps exist across teams, roles, and seniority levels
• Review promotion and development processes to ensure opportunities are being distributed fairly
• Challenge assumptions around part time work, parental leave, and flexibility
• Introduce greater transparency around pay bands, salary progression, and decision making
• Train leaders to recognise unconscious bias in hiring, performance, and promotion discussions
• Set measurable goals so progress can be tracked over time rather than discussed in general terms