The gender pay gap explained

The gender pay gap has been hot in the news the last few years, especially since the introduction of mandatory gender pay gap reporting for companies over 250 employees. But what exactly is the gender pay gap? And how is it worked out?

The gender pay gap

The gender pay gap measures the difference between men’s and women’s average earnings across an organisation or the labour market.

It should not be confused with unequal pay, which would be where women were being paid less than men for doing the same work or work deemed of equal value.

What causes the gender pay gap?

There are many different reasons for the national gender pay gap. One of the biggest is the lack of women in senior – higher paid – roles in organisations. There is commonly a concentration of women at the lower end of the pay scale in organisations.

Lack of women in better paid sectors

There is a link between the lack of women in better paid sectors in the UK, such as technology, engineering and finance.

Part time jobs

Part time working and lack of part time jobs at senior levels also holds back women’s pay. More women than men do part time jobs, although this is shifting, and this is usually because they are still more likely to be the main carers of children or elderly relatives.

Career breaks

Women are also still more likely to have taken career breaks to raise children, and there is a very real struggle to get back into jobs on the same level as they were earning previously. This may be due to lack of flexible working or unconcious bias, including assumptions that women do not want to profess their careers if they have children, along with lack of sponsorship and support as compared to men.

Childcare in the UK

Extremely high childcare costs exist in the UK – some of the highest in Europe – and this can lead to women dropping out of the work place or taking lower paid part time work to manage childcare cover.

Tackling the gender pay gap

Tackling the gender pay gap requires a raft of different measures.

Flexible working should be encouraged at all levels of an organisation as well as more support for those requiring childcare, promotion of Shared Parental Leave so that women have less time out of the workplace, and greater support for dads who want to work flexibly.

Not only does the gender pay gap has a knock-on impact on women’s pensions, it is also worth noting that the lack of women in senior positions in industry and in politics means that women’s voices have often been missing from vital discussions about a whole range of social and business issues.

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