Damning gender pay gap figures reveal the true extent of workplace inequality
Although some may dismiss pay gap news stories as promoting equality for equality’s sake, closing the gender pay gap is economically valuable to everyone, not just to women, says Dods Monitoring Content Specialist, Rosie Lythgoe-Cheetham.
Last Wednesday (April 4 2018), all UK companies who employ at least 250 workers were required to make their gender pay data publicly available. The results were damning to say the least, revealing that almost 8 in 10 public sector bodies and companies pay men more than women overall. However, given that it has been illegal in the UK to pay women less than men since the introduction of the Equal Pay Act in 1970, how can it be possible for the figures to be this disparate?
Women are far more likely than men to leave full-time employment for unpaid domestic roles like childcare or caring for an older relative, perhaps taking on a less challenging part-time job alongside this. At the most recent census in 2011, 1 in 4 UK women aged between 50-64 identified as carers. As a result, many working women experience a break in the trajectory of their career progression, a barrier which is rarely faced by men who go on to occupy the vast majority of higher paid roles in management or leadership.
Further to this, although many women will return to the workplace after caring duties become obsolete, they do so at a huge pay cut. According to ONS statistics, from the age of 40 onwards the pay gap widens, reaching a peak between 50 and 59, as these women are forced to take on more entry level roles despite good experience from their former working life.
The Government’s Women and Equalities Office has introduced guidelines for workplaces to recruit more women who return to the workplace after time out. As part of a £5m commitment in the 2017 Spring Budget for women returners, this guidance focuses on the economic and business benefits to be found from employing older women; good work experience, life experience and qualifications. With Government support, companies can set up ‘returner programmes’. It is hoped that this will help to close up the wage gap by paying older working women a wage which does not discriminate against their choice or need to take a career break for caring duties.
Many studies suggest that women tend to be underconfident in the job application process and are more likely to consider themselves underqualified for top jobs. Andrei Cimpian from New York University conducted a study which ultimately concluded that ‘pervasive cultural stereotypes associate brilliance with men, not women’. This attitude undoubtedly steers women away from applying for big management roles.
A now infamous Hewlett-Packard internal survey from 2013 claimed that “men apply for a job when they meet only 60% of the qualifications, but women apply only if they meet 100% of them”. There are many potential reasons for this, from a greater need for women to avoid failure to seem ‘good enough’ as an employee, to a long-standing discipline and rule-following culture in females. Even before starting an application, women are hesitant to take risks and therefore miss opportunities, falling before the first hurdle.
The most troubling outcome of this widespread female employment underconfidence is poor representation of women across big company boards, the public sector and law making – meaning ultimately that big decisions in the UK are still consistently made mostly by men. According to the Government-backed Hampton-Alexander review, the lowest ranked FTSE 100 companies for the employment of women in board and leadership positions include the London Stock Exchange and Prudential as well as Barclays PLC and BP, who had an all-male executive committee at the time of publication.
The Government enforces voluntary targets for all FTSE 100 companies to have 33% female representation and fortunately, progress appears to have been made – in 2017, 27.7% of board positions in FTSE 100 companies were held by women; in 2016 it was 26.6% last year; in 2011 it was 12.5%. MPs Margot James, Anne Milton and Justine Greening who were the driving force behind producing the report and hope that this slow and steady balancing between genders on boards will continue to improve. The Chartered Institute of Professional Development however believes that the target should be increased by an additional 20%.
Although the gender pay gap is still one of the biggest workplace issues today, it’s clear that many systems to improve wages for women are already moving in the right direction. Although some may dismiss pay gap news stories as promoting equality for equality’s sake, closing the gender pay gap is economically valuable to everyone, not just to women, meaning that it truly is worth making the effort to improve gender balance at work.