International Women’s Day: Unravelling Gender Pay Gaps in Fashion Value Chains

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As we approach International Women’s Day, it is imperative to recognise the enduring challenge of pay inequality within the fashion industry, disproportionately affecting women and other historically marginalised groups worldwide.

Globally, women are paid roughly 20% less than men on average, and unfortunately, the fashion sector mirrors this stark reality.

Pay inequality is common throughout the global economy. For instance, individuals often receive different levels of compensation for occupations requiring the same level of skill, experience, responsibility, and risk. This discrepancy often stems from factors unrelated to their job proficiency, and vulnerable groups, including migrant workers, subcontracted home workers, individuals from racial, ethnic, national, and religious minorities, along with members of the LGBTIQA+ community and women, frequently bear a disproportionate impact.



Where is the fashion industry today?

With approximately 94 million workers employed globally in the garment industry, women account for 60-80% in different regions around the world, and many frequently find themselves in lower-paid positions.

International Women’s Day serves as a significant moment to contemplate the women advocating for a reimagined fashion industry, while also acknowledging that the fashion sector grapples with power imbalances and systemic inequality, particularly evident in the gender pay gap. As the fashion industry strives for sustainable and ethical practices, the persistent gender pay gap remains a critical challenge. Substantial shifts need to take place if we are to meet the UN’s Sustainable Development Goal of gender equality by 2030.

Notably, the International Labour Organization (ILO) estimates that, at the current rate of progress, it will take 257 years to close the global gender pay gap.

In the fashion industry, this issue is exacerbated for individuals in lower-paid and precarious occupations, with limited access to legal protections and grievance mechanisms. Occupational gender segregation emerges as a primary contributor to these disparities. Women often find themselves in lower-paid, less senior roles, facing limited opportunities for permanent employment. Additionally, the prevalence of part-time work and informal employment further compounds the problem, leaving workers with diminished access to legal entitlements. Employers’ reliance on biased wage-setting practices rooted in gender stereotypes perpetuates this cycle of inequality.

This imperative extends beyond production countries, highlighting concerning trends in corporate headquarters where women CEOs are dwindling, and only one-fifteenth of the industry’s wealthiest are women. C-suites continue to be dominated by men and individuals of white ethnicity, emphasising the urgency for industry-wide reform.

There is also a lack of transparency in disclosing gender pay gaps, particularly in the fashion supply chain. While progress has been made in higher-income countries, transparency at the supply chain level remains inadequate. Nevertheless, promising strides are being made, with 86% of producers committing to addressing the gender pay gap across the textile value chain by 2040.



Efforts to close the gap

The Anker Research Institute is at the forefront of industry initiatives addressing the gender pay gap. They have pioneered a standardised methodology for assessing and comprehending gender pay disparities within global supply chains. Furthermore, the institute has conducted in-depth studies on the gender pay gap within the garment sectors of Turkey, Bangladesh, and Thailand. These findings were recently unveiled at the OECD Forum on Due Diligence in the Garment and Footwear Sector. Access the complete report here.

Simultaneously addressing these challenges, legislative strides are being made. The EU Pay Transparency Directive, effective by 2027, mandates disclosure of remuneration for men and women doing equivalent work in companies with over 250 employees. It also calls for a joint pay gap assessment if the gender pay gap exceeds 5%, aligning with the ILO’s call for equal remuneration. Adhering to these directives won’t just ensure accountability but also propel the fashion industry towards a more inclusive and just future.



Actions needed to unlock the next level

In honour of International Women’s Day, Global Fashion Agenda, PwC, and Camera Nazionale della Moda Italiana have orchestrated a leadership roundtable and networking lunch to start unpacking gender pay gaps in European fashion value chains. The event not only provided a succinct exploration of market insights on gender equity and wage parity but also unveiled an overarching ambition to unite in empowering women across the fashion industry.

Addressing the gender pay gap requires a unified commitment from all stakeholders. The industry must prioritise transparency, equal opportunities, and fair compensation across the entire value chain. By adopting responsible purchasing practices and promoting pay equity, the fashion industry can become a catalyst for change. As there remains a crucial need for dedicated research on wages within the European fashion value chain, Global Fashion Agenda together with its insight partner PwC will collectively present thought leadership that identifies and unpacks gender pay gaps in fashion value chains in Europe, starting in Italy with support of Camera Nazionale della Moda Italiana.

Delve deeper into the discourse on gender pay gaps within the fashion industry as we continue our exploration of this critical topic at the Global Fashion Summit: Copenhagen Edition in May. Secure your ticket here and join us in advancing the conversation on achieving equity and empowerment within the fashion value chains.

As we celebrate International Women’s Day, let us collectively pledge to bridge the global gender pay gap and create a future where all workers are valued and compensated equitably, regardless of gender or individual traits.

Dive into the insights offered by the GFA Monitor 2023, particularly in its dedicated chapter on Better Wage Systems. Armed with this knowledge, fashion brands can actively collaborate with manufacturing partners, promoting responsible purchasing practices and championing crucial causes such as worker rights, pay equity, wage transparency, and workforce empowerment. Download the GFA Monitor 2023 today to explore comprehensive solutions and drive positive change.

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