The gender pay gap is linked to broader wage inequality – and both require urgent action

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By  Karen Rowlingson, Professor of Social Policy
Department of Social Policy, Sociology and Criminology, University of Birmingham

According to data from the recent gender pay-gap reporting exercise almost eight out of 10 companies and public-sector bodies in the UK pay men more than women, with women being paid a median hourly rate in 2017 that was, on average, 9.7% less than men.

It has taken eight years from when the law on gender pay-gap reporting was originally tabled to get to the publication of these figures and yet the data is still very limited. Most importantly, it does not tell us whether women are being paid less than men for the same work, something which has been illegal since the 1970 Equal Pay Act but is likely to still exist. The limitations of the data have led some to dismiss the exercise, arguing that the data tell us nothing very helpful and, if there is an issue at all, it is ‘simply’ because women are not in the most senior roles.

However, a range of recent studies show that the gender pay gap is far more complex than this. For example, research shows that the average young woman aged 18-21 working full-time already starts her working life earning £1,845 less than her male peers. This is nothing to do with senior roles and well before most women start a family (the reason often given to ‘explain’ the gender pay gap). And even when women make it to the very top, their earnings are still far lower than their male counterparts.   Male FTSE 100 chief executives earned an average of £4.7m in 2016 compared with the £2.6m average for equivalent female bosses, according to a report by the High Pay Centre and the Chartered Institute of Personnel and Development.   Another myth is that women do not necessarily put themselves forward for wage rises as often as men, but recent research refutes this, while also showing that men are nevertheless 25 per cent more likely than women to get a rise when they ask.

So we should not see the gender pay gap as simply about women not making it to the most senior positions. It is caused by much broader social, cultural and structural factors which require significant action to tackle. Nevertheless, it is also true that there are too few women in higher earning occupations and in senior level roles. So part of the solution must also be to support women to climb the ladder more successfully and this will require companies and public bodies to take firm actions to change their policies and practices.

But we also need to change the current structures of pay which lead to unacceptable wage inequalities more generally. For example, data from 2016 shows that it would currently take an average UK full-time worker (on £28,000 per year), 160 years to earn what an average FTSE 100 CEO earns in just one year. Rather than putting efforts into helping female CEOs to earn more, we should be reducing high pay at the top. This would both reduce the gender pay gap (because most of those on the highest salaries are men) and create a fairer society for all. This is something that has recently happened in a very small way at the BBC. It now needs to happen on a much greater scale.

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