Like anything else, it's a combination of factors.
The London School of Economics did a pretty in-depth study and found:
The main cause of this is that many women continue to take breaks from paid employment when they have children. The problem is not that women are choosing one career – such as hairdressing – rather than another – such as plumbing. It is that they are continuing to choose family over career at some point in their life.
However, the same study also goes on to say that:
While career breaks clearly have an impact,
my research with Joanna Swaffield finds that
most of the gender gap in wage growth
among young workers cannot be explained
by differences in labour market attachment.
For example, we estimate that a woman
who has worked full-time ever since leaving
full-time education can still expect to be
paid 12% less than an equivalent man after
The cause appears to be a combination of factors. This study sites the following as the cause:
One way of seeing this is in the evidence
that women are much less likely to become
managers...Some recent research (see Babcock and Laschever) suggests that
systematic differences in personality are
responsible – for example, that women are
intrinsically less competitive than men, tend
to be less self-confident and less effective in
negotiation. This might be because of
intrinsic differences between men and
women or because of gender stereotyping
within the education system.
The report ends with the remark that, "that it is now not so easy to
identify the remaining causes of the gender
So to summarize this study, the main causes seem to be breaks from employment and personality differences. The study also mentions that the pay gap has been decreasing in recent years, although does not mention if this is due to less focus on staying home with the kids or less discrimination.
However, Ian Watson (published in the Austrian Journal OF Labour Economics) takes a slightly different opinion on this. The abstract of his study is that:
show that female managers earned on average about 27 per cent less than their male counterparts and the decompositions suggest that somewhere between 65 and 90
per cent of this earnings gap cannot be explained by recourse to a large range of
demographic and labour market variables. A major part of the earnings gap is simply
due to women managers being female.
You can read the statistics in the paper, but the results are:
The extent to which discrimination accounts for the gender pay gap varies between
65 per cent and 94 per cent, depending on the approach one takes. The higher figure
comes from using the Oaxaca method, while the lower figure comes from the Blinder
method. These decomposition results are shown in summary form in table 5 and with
a more detailed breakdown in table 6.
The U.S. Government Accountability Office did another study and determined that discrimination is indeed a factor:
In 2003, GAO found that women, on average, earned 80 percent of what men earned in 2000 and workplace discrimination may be one contributing factor
There has been a meta analysis done on various studies and this analysis found:
The results show that data restrictions – i.e.
the limitation of the analysis to new entrants, never-marrieds, or one narrow
occupation only – have the biggest impact on the resulting gender wage gap.
Moreover, we are able to show what effect a misspecification of the underlying
wage equation – like the frequent use of potential experience – has on the
calculated gender wage gap. Over time, raw wage differentials worldwide have
fallen substantially; however, most of this decrease is due to better labor market
endowments of females.
... Our results show that data restrictions have
the biggest impact on the resulting gender wage gap...For example, in the fixed effects regressions we find
that studies where work experience is missing seriously overestimate the
unexplained gender wage gap.
However, the study does still say there is some discrimination, but it is not as dramatic as others make it out to be. The resulting decrease in the pay gap is due to training and some decrease in discrimination.
From the 1960s to the 1990s, raw wage differentials worldwide have fallen
substantially from around 65 to only 30%. The bulk of this decline, however,
must be attributed to better labor market endowments of females which came
about by better education, training, and work attachment...The ratio of what women would earn absent of discrimination relative to
their actual wages decreased approximately by 0.17% annually. This indicates
that a continuous, even if moderate, equalization between the sexes is taking
One thing to note as well is that the pay gap is higher in the public sector than the private sector. This tends to show there is an element of discrimination, as public sector jobs tend to have pretty strict promotion/pay increase rubrics.
In conclusion, it's caused by a number of factors, but it would be incorrect to make the claim that discrimination is not one of them. However, it's certainly not the only cause and it may or may not be the greatest cause.
In terms of the pay gap being evidence of discrimination, it certainly is, as most of the statistical studies say the gap is unexplained by other factors. The gap may not be caused solely by discrimination, but it does show evidence of some unexplained factor causing pay differential, which is usually attributed to discrimination when the other causes are explained. Causes such as time off for family and personality are included in the studies, but there is a statistically significant gap left unexplained that can be reasonably filled with discrimination. According to the studies I've posted, the gap decreases in the public sector and in large companies with pay scales. This points towards the pay gap being evidence to discrimination. Hence, the pay gap is evidence of an unexplained discrimination of women in terms of their compensation.