The determinates of pay inequality between men and women: Evidence from Saudi Arabia

Abstract

This thesis investigates the reasons behind pay inequality between men and women in Saudi Arabia (SA), and the extent to which gender plays a role in explaining women/men pay. The main purpose is to give a clear explanation of why women in SA are paid less than men across the private and public sectors. This study differs in a range of ways from past gender pay gap studies in their investigation of the factors that may contribute to pay inequalities between men and women, specifically in Saudi Arabia (SA). Many prior studies employ survey analysis as a single research methodology, whereas this research does differently as its innovative use of mixed methods to provides a comprehensive framework that explains the existing pay gap differences in SA. This research consists of two phases to analyze gender pay inequality in the private and public sectors in SA. The first is the quantitative phase, which entailed the collection and analysis of secondary and primary data. The secondary data were collected from: (i) General Organization for Social Insurance (GOSI) in SA, and (ii) Labor Force Survey (LFS) in the United Kingdom. The primary quantitative data were collected through questionnaires distributed to employees in a range of large, medium, and small Saudi organisations in both private and public sectors. The second phase is qualitative analysis, where semi-structured interviews were conducted with 13 male and female Human Resources (HR) managers across private and public sectors. The results of the thesis indicate that the adjusted gender pay gap, obtained when controlling for the usual socio-economic characteristics, is close to 27%, and the unadjusted gender pay gap, calculated as the percentage difference in male and female median wages, is 45%. Gender, age, length of service with current employer, working in the public sector, working longer hours per day, education, full-time positions, professional qualifications, nationality, and working in managerial positions all play particularly important roles in determining employees’ pay. Furthermore, the findings of the interviews analysis show that the contextual factors, such as patriarchal culture and Islamic religion policies are the key factors, which have a significant role in creating the gender pay inequality within Saudi organisations. Most significantly, the results refer that there is discrimination against women in terms of their access into the labour market, managerial positions, and the segregation and concentration of women in low-paying, career-limiting positions and industries.