John Humphrys explores reasons behind the gender pay gap in Britain as a report is published showing still-existing shortfall will take 98 years to equalise
Some people, perhaps politicians especially, seem to believe that all it takes to change the world is for governments to pass a law. If only it was so easy. But the case of equal pay shows that it isn’t. Forty-one years after equal pay legislation was first passed, women in executive jobs are, on average, earning over £10,000 less every year than their male counterparts. On current trends in pay settlements, it will take ninety eight years for them to catch up.
These are the findings of a survey of 34,000 executives in Britain carried out by the Chartered Management Institute. They show that, on average, male executives earn £42,441 a year compared with £31,895 for women. The gap has actually widened in the last year and is especially glaring in the IT and retail sectors.
It’s true that, overall, women’s pay went up marginally faster than men’s last year – by 2.4% compared to 2.1%. But at that rate of catch-up, it will be 2109 before women achieve full equality.
There is, however, some good news for women in the survey. At a more junior level, women executives earned marginally more than men: £21,969 pa compared with £21,367. This progress has been attributed to higher achievement by girls at school and by the increasing numbers of young women gaining degrees.
At the top end, though, women not only earn considerably less than men but are more vulnerable to losing their jobs. Over the last year, the level of redundancy among women directors was five times higher than among men. This happened despite the widely shared belief that that there are far too few women on the boards of British companies and that something should be done about it. Back in February, an inquiry under Lord Davies of Abersoch came to the conclusion that there needed to be a 25% increase in their number over the next five years or government would have to take direct action. A group of company chairs called the 30% Club has been set up to help bring this about.
Why, despite the forty-year-old equal pay legislation, are women in more senior executive jobs still being paid so much less than men? One reason traditionally given is that it is because it’s women who have babies. Even though women enjoy statutory maternity rights which mean they cannot lose their jobs when they take maternity leave, they still lose out because by the time they get back to work they have often missed opportunities for further training and therefore for promotion. They go back to work at a lower level than they would have achieved had they not had children and this is then reflected in their lower pay. Some go back on a part-time basis and part-time pay tends to be at a lower rate than full-time pay.
One way to overcome these built-in disadvantages for women is for greater paternity rights to be granted so that there is at least the chance that parents can more equally share the responsibilities of child-rearing, enabling women to go back to work sooner if they wish to and on a full-time basis.
But having babies does not alone explain the pay gap. Trade unions have argued that there are systemic inequalities in many areas of work whereby various categories of work which tend disproportionately to attract women have grades of pay which are lower. Campaigns by unions to change such bias have had some success, especially in the public sector. But although these campaigns have helped groups of women, they are of not much use to individual women who think they are personally being discriminated against. The problem here, say campaigners, is the nature of the existing legislation.
If an individual woman employee thinks she is being unfairly paid compared with her male colleagues, the existing law is of help to her in righting the situation only if she has clear evidence of discrimination. But this is usually very hard to come by because of the abiding tradition of secrecy by employers regarding what they pay their workers. Without more openness about pay rates it is almost impossible for an individual woman to use the law to secure equal pay. That is why some campaigners are arguing that companies which employ more than two hundred and fifty workers should be obliged to publish average pay rates for both their male and female employees.
Many employers, however, resist this idea. They see it as a first step to having to publish individual salaries, information which they wish to keep secret. In part this may have less to do with wanting to perpetuate discrimination against women and more for fear of creating dissension among their workforces whose members individually might then start to feel discriminated against compared with their colleagues. So far, at least, the Government shows no sign of wishing to force companies to publish average pay levels comparing the sexes.
Maybe the longer term solution is for more women to get into senior positions in companies, so gaining the power to make equal pay happen. But whether that will take 98 years remains to be seen.
What’s your view?
- Do you think pay inequality matters?
- Is there discrimination against women regarding their pay where you work?
- If you are a woman, do you think you suffer from unequal pay and, if so, what have you tried to do about it?
- Do the figures produced by the Chartered Management Institute surprise you?
- What do you think is the main reason why the pay of women executives trails so far behind men’s?
- How much do think that it is because it’s women who have babies that women’s pay continues to lag behind men’s?
- Do you think increasing paternity rights for men would help?
- How important do you think secrecy about pay rates is in keeping women’s pay behind?
- Should the law be changed to force companies to be less secret about pay rates?
- And what else, if anything, do you think the Government should do about the equal pay issue?