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Source: Human Rights Commission

New research examining the factors that contribute to Pacific, Māori, and ethnic pay gaps in Aotearoa New Zealand has been launched by the Human Rights Commission’s Pacific Pay Gap Inquiry.

The report ‘Empirical analysis of Pacific, Māori, and ethnic pay gaps in New Zealand’, is the first in a series of reports published by the Inquiry. 

Conducted by AUT’s New Zealand Work Research Institute (NZWRI), researchers found that only 27 percent of the pay gap for Pacific males could be explained, and 39 percent for Pacific females. 

Interestingly though, 73 percent of the pay gap for Pacific males and 61 percent of the pay gap for Pacific females could not be explained even after accounting for differences in job-related characteristics and educational attainment, among several other observed factors. 

“This research provides further evidence about what we’ve long suspected – the bulk of the Pacific Pay Gap can’t be explained and is at least partly due to invisible barriers like racism, unconscious bias and workplace discriminatory practices,” said Saunoamaali’i Karanina Sumeo, Equal Employment Opportunities Commissioner.  

“These human rights violations are holding back Pacific workers from realising their full potential in the workplace.” 

“Pay gaps exist because we perpetuate the entrenched disparity it needs to survive. Our current systems simply aren’t set up for Pacific, Māori, ethnic minority workers to feel respected, supported and to thrive in the workplace,” added Sumeo.

Researchers used a wide range of observed factors to test which could explain the pay gap. These included job characteristics, education levels, number of household dependents, and regions where people lived.

NZWRI Director, Professor Gail Pacheco, says the portion of the pay gap that can be explained is due to several observed factors, one factor being the types of jobs predominantly held by Pacific workers. 

“We found that Pacific people are less likely to be a manager, and more likely to be in a labour type occupation. Additionally, Pacific men are more highly concentrated in the manufacturing industry, while Pacific women work mostly in the healthcare and social assistance sectors,” says Professor Pacheco.

The research shows that the portion of the gap that cannot be explained is attributable to several factors. These include non-observable factors such as area of study and personal preferences for non-wage aspects of the job. 

“It’s unacceptable that Pacific, Māori and ethnic minority workers continue to be penalised and undervalued in the workplace based on unfair workplace practices, unconscious bias and racial discrimination. Children, families, and entire communities are suffering. This is a breach of basic rights to equality and dignity, and it must end with us,” said Sumeo.

“While we must continue to invest in education and training for our Pacific communities, this research shows education alone will not close the Pacific Pay Gap. Our lawmakers and employers need to be held accountable and take action on pay inequity and the unequal treatment of our workers.”

“We must urgently implement measures to reduce ethnic pay gaps, so every worker is fairly rewarded for the work they do and is thriving in the workplace”, added Sumeo.


Key details

This report is a precursor to a comprehensive report soon to be released on the findings of the Pacific Pay Gap Inquiry led by the EEO Commissioner. 

We should note there are limitations to the analysis provided in this report. The first is the potential to over-estimate the ‘unexplained’ portion of the pay gap – this comes from the need to restrict the analysis to factors for which data is available. Second, discrimination (both structural and interpersonal) and unconscious bias will also affect what is considered the ‘explained’ portion of pay gaps, as well as the parts that are not explained.

Through surveys, submissions, workshops, and Talanoa, the Human Rights Commission has been able to collect evidence to better understand why the Pacific Pay Gap exists and what needs to be done to close the gap. 

The report on the Pacific Pay Gap Inquiry’s findings, including recommendations for Government and employers, will be released later this year. More information about the Inquiry can be found here.