Gender Pay Gap - Have We Closed It Yet?

by Georgia McKirgan

How do we change this mindset?

A recent presentation at school by the Institute for Economic Affairs got me thinking about gender equality in the workplace. First things first. The law in this country requires that men and women should get paid the same for doing the same job but there is still a 13.9% difference in the pay of men and women. 

Why is this? 

While there are still some cases where women get paid less than men for doing exactly the same job as men, the law is working to eliminate these differences. Where there are still differences, they tend to be found among older workers. The gap for women under 30 has almost disappeared.

So why is there still a gap between male and female pay?

The first reason is the fact that women have children. Recent research shows that unfair treatment of new mothers remains common. Every year, 54,000 women are forced to leave their job as a result of poor treatment after they have a baby. This can have a long-term impact on their earnings. There are also many obstacles that lead to new mothers leaving work earlier and returning to work later after giving birth than they would like. Beyond childbirth, women  continue to play a greater role in caring for children, as well as for sick or elderly relatives. As a result, more women work part time, and these jobs are typically lower paid with fewer progression opportunities. Often, as women return from a break to raise children, they find that their male contemporaries are being promoted ahead of them. So improvements in childcare are social care options may help to address this situation but I want to look at the problem in a wider sense.

We have a divided labour market.

Women are more likely to be in low paid and low skilled jobs, creating labour market segregation. Around 80% of those working in the low-paid care and leisure sectors are women, while only 10% of those in the better paid skilled trades are women. Women also make up 60% of those earning less than the living wage and men continue to make up the majority of those in the highest paid and most senior roles – for example, there are just five female Chief Executives in the FTSE 100. For the non-financially literate, that means there are 95 male Chief Executives out of the top 100 British companies.

So if the law just covers the narrow area of men and women doing exactly the same work, what can we do about this segregated labour market? I include the picture above at the top of the article to make a point. The picture shows a billboard at the side of the road in the USA and, while it is an extreme example of sexism and prejudice, I think we have to acknowledge the mindset it represents. When asked, most people will instinctively say they think men and women are equally capable at work. However, if you scratch the surface and push further, I think you'll find many men who feel that men are just better, more effective and more suited to the work environment. When you get beyond people's superficial answers, you'll find a deep vein of prejudice and sexism.

Part of the problem lies in the fact that what we still assume to be the behaviours and working styles necessary to succeed in business, reflect a traditional male value set. This has less to do with fact that these values and styles being more effective than traditional female values and work styles, rather, the fact that the work environment has been dominated by men for generations, these male styles have become the accepted conventions. Many women feel that they have to act in a very 'male' style to succeed in senior positions and this shouldn't be the case.

I accept many of the arguments against positive discrimination but I feel that for senior positions, UK listed companies should be required to follow a version of the rule in the NFL that has been adopted  to boost the number of Head Coaches from minority groups. The 'Rooney Rule' in the NFL says that every time there is a coaching vacancy, teams have to have at least one minority candidate on the shortlist. Teams are not required to hire a specific number of minority coaches but they are required to interview qualified minority candidates and this gives exposure to minority candidates that might otherwise get ignored. The rule has led to an increase in the number of minority coaches and these coaches are not only role models in their communities, they are helping to change peoples' views of how the job gets carried out. Adopting a similar rule for senior corporate appointments in the U.K. would increase the number of women in senior roles and this could have a similar effect in helping to re-define what it takes to be successful in business.

Current legislation is too narrow to effectively close the gender wage gap. We need to be honest that, despite progress over the last 30 years, there is still a huge amount of embedded sexism in the work place. We need to find ways of getting more women into senior roles as a way to start chipping away at labour market segregation. Improved child and social care would mean that women would not suffer as much career damage from carrying out their various caring roles but beyond that, something like the Rooney Rule should be adopted for senior corporate appointments for all UK companies. The combination of being honest about recognising the current unequal situation paired with practical policies that can start to address the problem is well overdue.

When it comes to overcoming the Gender Pay Gap, we are not there yet and the current situation is not good enough.