It was only 53 years ago that equal pay became a right for women in the UK, with legislation being passed in 1970.
Today, however, women across the world are still paid less for their work compared to their male counterparts.
What is the gender pay gap?
The gender pay gap is a figure which represents the difference in average hourly pay between men and women (before income tax).
Entering 2023, the UK gender pay gap is 14.9%.
The Equal Pay Act in 1970 laid the foundations for 2010’s Equality Act, which simplified and strengthened the law around fair treatment of all protected demographics. This made it clearer for employers to follow and for workers to know their rights.
In 2017, it was made mandatory for businesses with more than 250 employees to share their data for reporting and tracking progress on pay inequality, on a yearly basis. This is the data which forms our understanding of the gender pay gap.
Women work for free: data from the TUC and ONS ASHE
Last month, a new analysis by the TUC compiled data from the Office for National Statistics (ONS) Annual Survey of Hours and Earnings (ASHE).
The TUC calculated that with the current 14.9% pay gap, female employees work an equivalent of 54 days for free before they receive the same salary as their male coworkers.
In response, the TUC introduced February 23rd as Women’s Pay Day; “the day when the average woman stops working for free compared to the average man.”
The number of days worked for free is even higher for certain female demographics, fluctuating based on location, age group and industry.
Which UK locations have the highest gender pay gap?
The South East of England ranked the highest for pay inequality (17.9%), with women working an average of 65 days for free. This means they effectively work for free until the 6th March.
These three locations have much higher rates than the overall average, with the final median number being lowered by Northern Ireland, London and Scotland, which all had averages of between 8-12%.
Which age group of women face the highest pay inequality?
According to the data from TUC, women experience the highest pay inequality in comparison to their male co-workers between the ages of 50-59, with a gender pay gap of 20.8%. Women in this age group worked approximately 76 days for free at the start of 2023.
The motherhood penalty
In 2022, Kate Whiting released a discussion for the World Economic Forum on studies which show that up to 80% of the gender pay gap is a direct result of the motherhood penalty.
The motherhood penalty is a sociological term to reference discrimination faced by mothers in the workplace; being perceived as less efficient or committed due to prioritising their families, receiving fewer benefits or being paid less in comparison to childless female coworkers.
This is a key reason for pay inequality jumping from 3.9% at the age of 29, to an average of 11.7% at 30 – around the time that many women become mothers.
Find out more about the motherhood penalty in our article here.
Which industries have the highest gender pay gap?
The financial and insurance industry currently has the highest gender pay gap at 31.2%, meaning women work 114 days for free – almost a third of a year.
The finance industry has been under the spotlight recently following the FTSE’s 2022 report on female representation at the leadership level – read our discussion here.
How long will it take to close the gender pay gap?
Data from the ONS ASHE report states that over the last decade, the UK gender pay gap has fallen by around a quarter on average among full-time workers.
For the finance industry (with a pay gap of 31.2%), the Treasury’s women in finance charter champion, Amanda Blanc has estimated that reaching equal pay for women could take 30 years – despite being achievable within 10.
Beyond the UK, pay inequality is a problem for women worldwide. As reported by the UN, “at the current rate, it will take 257 years to close the global gender pay gap.”
Know your rights – resources on the gender pay gap
Right now, solving pay inequality largely falls to businesses – and there’s no one-size-fits-all solution. Stay tuned for our upcoming advice piece, with steps employers can take to help bridge the gap and information on how recruitment can aid your efforts.
As an employee, knowing your rights is the best method of action.
- Equal pay and the law, Acas
- “Invisible Women: Exposing the gender bias women face every day” is a novel by Caroline Criado Perez which defines how society is built for men first. Perez educates us on how to spot inequality which often flies under the radar yet affects the lives of women every day.
- Pregnant Then Screwed is a charity resource for women to know their rights around pregnancy and share their stories of workplace discrimination. Founder Joeli Brearley, who was fired two days after announcing her pregnancy, has also published a novel titled “The Motherhood Penalty.”
Work with Distinct
At Distinct, we strive to educate ourselves on equality issues such as the gender pay gap. Whether you work with us as a client or candidate, we’d be happy to discuss the best approach for gender equality in the workplace with you, including how to avoid unconscious bias and encourage transparent salary banding.
As leaders in the field, we take the time to understand organisations and candidates alike to ensure the right fit for all. Reach out to our Nottingham office today.
