Robert Chovanculiak // 12 July 2024

Women in Slovakia earn on average 16.6 per cent less than men. In the EU, the pay gap is around 12 per cent.

However, this popularly quoted figure does not account for the fact that women and men work in different sectors, in different positions, and for different lengths of time. They devote different amounts of time to childcare and housework, change jobs differently, have different willingness to move for work, and so on. When the pay gap is adjusted for these differences, it falls to minimal levels in Slovakia.

This finding sometimes sparks discussions on why women work in different sectors and in different positions than men.

Let us take a closer look at the latter question. This phenomenon – that women do not rise as high up in the career hierarchy as men – is called vertical segregation. For example, women comprise only about 35 per cent of managers in the EU. Critics of this phenomenon argue that women’s career progression is hindered by biases, discrimination, and other barriers that create a glass ceiling.

Discrimination and stereotyping are not the (whole) answer

Some countries have implemented measures to combat the vertical segregation of women. These include the Nordic countries of Europe, which have a long history and positive culture of supporting gender equality.

Denmark, for example, was the first country where a woman became a minister – specifically of education – a century ago. The country has had a ministry for gender equality for almost three decades. The emancipation of women in Denmark is visible, for example, in their high participation in the labour market.

However, despite strong historical, cultural, and institutional support for women in the labour market, the pay gap in Denmark stands at 12.7 per cent. And, as in Slovakia, when researchers adjusted for various objective differences and compared the ‘equal work’ of men and women, the pay gap fell by almost 11 percentage points.

One of the main explanations for the pay gap in Denmark is the relatively low proportion of women in managerial positions. Specifically, women constitute only 28.3 per cent of managers in Denmark, making the country the fourth-lowest performer in the EU.

Thus, we see that even a country with a gender-positive culture and institutions cannot entirely eradicate the problem of vertical segregation. In this context, the EU’s estimate that the GDP will rise by between 6 per cent and 9 per cent in 30 years’ time if the gender gap is eliminated seems distant reality.

The situation is similar in other Nordic countries. For example Finland and Sweden were among the first in the world to allow women to own, inherit, and run businesses. This culture of equality has endured to this day. For example, in surveys, these countries have the lowest proportion of people who think that ‘it can cause problems in a relationship if a woman earns more than a man’.

Despite all this, the gap between men and women remains above the average of 34,7 per cent in these countries. Except for Sweden, where women occupy 43 per cent of leadership roles.

A number of studies show that many of the policies adopted in Nordic countries to help women have actually had unintended negative consequences. Some of these consequences include a higher pay gap and vertical segregation. For example, generous and long paid maternity and paternity leave have a negative impact on women’s long-term careers. Mandatory quotas for women on company boards have led to a reduction in companies’ market value because of younger and more inexperienced management.

A major review study in 2021 concludes by finding that “firm performance deteriorated after the adoption of gender quotas.” Based on the findings, it appears that quotas have brought benefits to the most successful women. They have done little to help the majority of female employees in the labour market. Also, recent research has shown that long-repeated claims about the positive impacts of team diversity on corporate performance and management may have been significantly overstated or are difficult to prove.

Nordic countries – which have a strong culture and history of egalitarianism reinforced by institutional support for women – have not been able to eliminate the problem of vertical segregation, the low proportion of women in management, and the gender pay gap. It is useful to look at other explanations. These explanations point to problems other than the existence of a glass ceiling or discrimination. They may also consider statistical phenomena, such as the greater variability of men.

This article is part one of a series on the gender pay gap in Europe. Click here to read part two. 

This article was originally published by INESS in Slovak.