Abstract
The need to reduce the gender pay gap is an ongoing concern in developing countries. One aspect of gender inequality that is often neglected is the gender pay differential in the public and private sectors. In Nigeria, the structure and employee entry into public and private sectors differ significantly and could constitute a source of pay gap. This study decomposed the wage gap individually in the public and private sectors in Nigeria in 2009 using the Blinder–Oaxaca and quantile decomposition methods. The findings point to a smaller gender pay gap in the public sector compared to the private sector, due to better educational qualifications and higher income stream arising from longer stay in the workforce. Discrimination accounts for a significant portion of gender wage gap, although it is larger in the private sector. Women selection bias is a prominent factor in the private sector, while it is not much of a concern in the public sector. The results also show the existence of glass ceiling in the public sector and sticky floor in the private sector. Policies to address discrimination against women either in wage setting or hiring process should be introduced in both sectors. Increased participation of women in the private sector through creation of women-friendly jobs should be promoted in order to close the wage gap. Mandatory compliance with minimum wage regulations in the private sector should be enforced to attract more women to the sector and therefore narrow the wage gap at the bottom.
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Notes
The gender gap index has a scale of 0–1. 0 indicates inequality, while 1 represents equality.
In some public sector organisations in Nigeria, maternity leave has been extended to 4 months, beyond the regular 3 months, while some private firms give only 1 month maternity leave.
The GHS panel has been under intense criticism due to its limited scope. The country’s acceptable and most current poverty incidence of 53.5% is computed based on the 2009 NLSS data, despite the availability of more recent GHS surveys.
Glass ceilings exist when the gender wage gap is widened at the top of the wage distribution, while a wage distribution is said to exhibit a sticky floor if the gender wage gap is widened at the bottom of the distribution.
The data used in this study is freely available from the National Bureau of Statistics, Nigeria. There are no ethical restrictions on the data. The authors do not have any conflict of interest to declare.
See Jann (2008) for an explicit discussion on this topic.
Defined as Age minus years of schooling less six.
The occupation groups are managers, professionals, personal/community services, sales workers, clerical and administrative, technicians and machinery operators and labourers and related work.
This variable takes on 1, if the mother has a dependent child 0–5 years old, and 0 if child is above 5 years old.
These conditions were fulfilled in this study. In addition, normality and heteroscedasticity tests were carried out on the wage equation. The exogeneity of the covariates condition was also satisfied.
Heckman selection test was also carried out for male employees in the public and private sectors, but no evidence of sample selection bias was found. Hence, the result was not reported in the study.
This result is not presented in the body of the work, but available on request from the author.
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Aderemi, T., Alley, I. Gender pay gap in the workplace: the case of public and private sectors in Nigeria. J. Soc. Econ. Dev. 21, 370–391 (2019). https://doi.org/10.1007/s40847-019-00079-9
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DOI: https://doi.org/10.1007/s40847-019-00079-9