Gender Pay Gap Shows Significant Change in Disparity

Official government data shows the gender pay gap is now smaller than at any time since mandatory reporting began. Whilst on average men still earn more than women, there has been tangible progress made. 

Report Suggests Women Paid 91P for Every £1 Paid to a Man

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The median pay gap is now 9.1p, which means that on average for every £1 a man earns, women earn 91p. It’s important to point out this is the median figure though, so there are plenty of instances where the pay is similar, or trends higher for women.

Male Public Sector Remains Higher

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Surprisingly, it’s the public sector where the gap remains higher. The gender gap amongst government-funded organisations is 14.4% in favour of men.

Private Sector Making Much Better Progress

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Around 75% of private sector companies are still paying men more than women on average, as opposed to 87.6% of public sector organisations. 

Although There’s Work to Be Done, the Gap Is Shrinking

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In 2019, the gender pay gap stood at 17.4%, so the 3% reduction shows the remuneration across the jobs market is moving in the right direction.

Calls for Fines if Companies Don’t Comply With Equal Pay

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The general secretary of the Trades Union Congress, Paul Nowak, said: “Working women deserve equal pay but the gender pay gap is still a huge issue. At current rates of progress, it will take more than 20 years to bring men and women’s pay into line. That is not right … companies must now be required to implement action plans to close their pay gaps and bosses who don’t comply with the law should be fined.”

Pay Gaps Vary by Sector

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As expected there is variation by sector. Construction (22.8%), finance and insurance (21.5%), and education (20%) registered the biggest median pay gaps between men and women.

Women Are Higher Paid in Some Areas

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Further analysis shows that there are areas where women earn significantly more than men. Community and civil enforcement occupations (women paid 28.9% more), welfare professionals (20.9%) and biological scientists (20.6%) are all areas where female employees earn more than their male counterparts.

The Law Dictates Unequal Pay Is Illegal

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Under the Equal Pay Act 1970, it’s illegal to pay men and women doing the same jobs different amounts of money. There’s some wiggle room within ‘banding’ used by some organisations though.

Government Claiming to Help

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A government spokesperson said: “The gender pay gap has been trending downwards since 1997, and the government is committed to ensuring women have equal access to employment, enterprise and investment opportunities.”

Understanding Reasons for Pay Differentials

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The headlines suggest that there’s blatant unfairness with regards to payment of men and women, but it’s not always the case. Hours, skills and industries factor into remuneration too.

Women Still Work Fewer Hours

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Taking remuneration alone on face value doesn’t tell the whole story. Women are still far more likely to work part time hours than men, reflecting a reduction in pay. In many cases this is a voluntary decision (but not always).

Hours Gap Is Very Significant

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When gross salaries are considered, it’s worth noting that according to government figures, 38% of women in employment worked part-time, compared with 14% of men. Whilst this doesn’t explain hourly pay differences, it helps to explain some income disparity.

Certain Industries Are Paid Relative to Skill

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In industries such as construction, skilled trades will naturally earn more money than administrative staff and the like. The skilled trade roles tend to be occupied by men, so that will go some way to explain the difference. 

How Accurate Is the Gender Pay Gap Data?

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This is an interesting point in the discussion. Gender pay gap data is only accrued from organisations employing 250 or more staff.

Sample Size Is Relatively Small

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Taking the UK business base as a whole, government figures show there are 36,900 medium-sized businesses (with 50 to 249 employees), 0.7% of the total business population. Only 8,000 businesses were large businesses (with 250 or more employees), 0.1% of the total business population.

Ignores Millions of Self Employed

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Outside of the 37,000 businesses who didn’t report figures, there are also 4.33 million self employed and sole traders in the UK, which will not be contributing to the data.

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