Is there really a gender pay gap in Spain?

Source: blog.cuatrecasas.com

Lately there has been a lot of talk in Spain (and probably in many countries) about the difference in professional development opportunities between men and women, as well as the great difference in salary that exists between genders. It is often said that women are paid less money than men in general and also that there is therefore a strong discrimination against women, who will receive less money for doing the same job.

There are many articles and reports on this subject that try to cover all the nuances of this problem. That is why we have decided to analyse this situation for ourselves and to answer questions such as whether this gap really exists, where it is greater and where it is smaller, whether it is decreasing or increasing, etc.

To do so, we have used the public data provided by the Spanish Institute of Statistics.

In which region is the highest paid? In which region is the lowest paid? And in the other regions, what is the salary?

Let’s start by looking at salaries generally, across the country. Generally all countries have more economically advanced locations and this is due to several factors such as tax facilities, taxes, the number of companies that set up, investment in innovation and in the necessary infrastructure to move forward, etc. And of course this is also the case in Spain.

Fig. 1 Highest Salary vs Lowest Salary

As could be expected, there is a salariy gap of almost more than €6000 between the autonomous community with the highest salary (Basque Country) and the minimum salary (Canary Islands). This can be explained by the following reason:

High Industrialisation vs Low Industrialisation: the Basque Country has a very powerful business fabrics that allows it to be at the head of the country, even above Madrid or Barcelona. However, the Canary Islands have based their economy mainly on tourism and the service sector.

Fig. 2 Average Salaries by States

In the picture above we can see that the highest average salaries are found in the Basque Country, Madrid, Navarra and Catalonia. These states are highly developed and industrialised and are very competitive in terms of business opportunities, even at European level. The low average salary in some states can be explained by rural exodus, location of state, etc.

We also notice that the differences between men’s salaries and women’s salaries and those who do not identify with these two genders are remarkable (‘Both’). In some cases this difference reaches more than 6000 €. But this comparison includes all kinds of jobs, at different levels, so let’s go further.

Where do men earn more money? And women? Is there much difference?

Fig. 3 Comparison between Higher Salaries and the Highest Salaries

We start by looking at salaries in the 75th percentile and above, which means that we are talking about salaries of highly skilled, highly educated, highly specialised and highly experienced people. This group would also include managers and senior managers.

What the graph shows is a very important fact. There is a big difference in salaries between men and women in all states, and in some cases of more than €10,000 as in Madrid or Catalonia in the 90th percentile (Extremely High Salary). In general, there seems to be at least €6000 difference between the highest salaries earned by men and women. At the other extreme we have the case of the Canary Islands or Extremadura, where the difference is less than €4000.

This can happen for two reasons. The first is that men are paid more for the same work (which is unlikely) or that the number of bosses, managers and senior managers are mostly men (which is very likely) as the gap increases in the more industrialised states.

Where do men earn less money? And women? Is there much difference?

Fig. 4 Comparison of Low Salaries and the Lowest Salaries

We assume this time that this group includes people with low skills and jobs requiring little specialisation. Therefore, salaries would not be very high in general.

We might expect that in this salary segment (25th percentile and 10th percentile) the differences would be smaller. In fact they are, but even in this segment there are differences of at least €3000 (Canary Islands) and in some cases this difference reaches more than €6000 (Basque Country).

We could think that in this case these big differences could be due to the type of unskilled work, i.e. a worker (usually men) will be paid more than an administrative or assistant (usually women). Another possibility could be that women occupy more low-paid jobs. The truth is that with the data we have we cannot make a very accurate assumption about this.

What about the future?

After analysing the evolution in recent years of men’s and women’s salaries across the country we asked ourselves, what will happen in the future, will this salary gap increase or decrease?

For this purpose we have developed a basic time series analysis model based on ARIMA (Autoregressive Integrated Moving Average) in which, using data from 2008–2017, we try to predict the behaviour of salaries until 2021.

Fig. 5 Salary expected in the next years

We note that in recent years there has been a large gender pay gap that has not narrowed over time and has even increased. Moreover, this gap is not likely to disappear in the coming years.

To conclude, it has become clear that there is a large salary gap between men and women in the different salary brackets we have studied. We still have a long way to go before this gap decreases and salary discrimination disappears. To check out this project please click here to go the repository.

Julio Daniel is a Industrial Engineer, with high education in Big Data, BI and Machine Learning. These knowledge areas has became essential to him and so he pretends to jump into this field by working on differents own projects and continuing learning with motivation and passion in order to get confidence and to improve his skills.

Julio Daniel is a Industrial Engineer, with high education in Big Data, BI and Machine Learning. These knowledge areas has became essential to him.