Inter-Industry Gender Wage Differentials in Kenya

In developed countries, the gap between male and female pay has been reducing significantly due to legislation and regulation. However, globally, the gap is widening, and even where the gap is narrowing, it is unacceptably slow. Using the 2013 World Bank Skills Towards Employability and Productivity Survey (WBSTEPS), this study seeks to investigate inter-industry gender wage gaps in Kenya. The results of the inter-industry gender pay differences reveal that even after accounting for personal characteristics and gender pay differences across the industries (except in the agriculture, fisheries, and mining sectors), women still receive less pay than men. In the commerce and trade sector, men’s wages were 27.2 per cent higher than women’s. Based on a counterfactual analysis, women’s earnings would increase by 17.5 per cent if they had the same characteristics as men. In the services sector, men earned 28.5 per cent higher than women and women’s wages would increase by 22 per cent if they had the same characteristics as men. In the manufacturing and construction sector, men earned 23.1 per cent more than women and the counter-factual analysis showed that their earnings would increase by 18.4 per cent if they had the same characteristics as men. In the agriculture, fisheries, and mining sectors, 57.9 per cent of the difference was due to human capital characteristics such as endowments. Admittedly, we find evidence of gender penalty in Kenya’s labour market as there exists inter-industry gender wage differentials explained less by the observable characteristics such as age, marital status, experience, tenure, education, profession