On this year’s International Women’s Day, the conversation around the gender pay gap had a resurgence. Thanks to the Gender Pay Gap Bot, companies who were promoting International Women’s Day were exposed with their gender pay gap median percentages on Twitter. This sparked lots of discussion on the topic and it became clear how damaging it can be for organisations who are all words no action. So, what is the Gender Pay Gap and how can this effect your chances of securing the top talent?
What is the gender pay gap?
The gender pay gap is the difference in the average hourly wage of all men and women across a workplace and it has deep roots in the UK. Having a gender pay gap doesn’t mean that you are paying men more than women for doing the same or similar work (which is unlawful), there are likely to be other, societal reasons that explain the disparity. According to Alex Bryson, professor of quantitative social science at UCL, there’s evidence that women go into the labour market more highly qualified than men, suggesting they ought to be paid a premium. However, even where they start their careers earning as much as their male counterparts, as many take time out of work to look after children, their wages start to fall behind. There’s been conversation around whether we should be referring to it as a ‘parenthood’ gap as opposed to a gender gap.
In the 60’s and 70’s, it was usual for women to be paid less than men. At that time, women’s work was generally considered to be less important than the work performed by men and that bias was reflected in their pay. Whilst that view hasn’t been completely eradicated, there has been substantial change. Over the last 40 years, the UK has seen a continual rise in the proportion of women in employment which is very much a leading factor in why there have been changes in female to male wage discrepancies. These days it’s rare to see examples of direct discrimination where women are paid less for doing the same job as men. However, there’s plenty of evidence to show that women are still being paid less for doing work of equal value.
Will all the different societal factors contributing to the gap, the fact remains that women are prepared to accept lower pay for the flexibility they need to balance their work and home lives. In doing so, they lose out on promotions and their earnings increasing incrementally over time like their male counterparts.
The Gender Pay Gap in ‘The Great Resignation’
As we know now, the culture, environment and purpose of a particular role in a potential employer take governance over other credentials in a candidate’s job search. Having a gender pay gap, particularly if its significantly higher than the national median average of 15.4% (2021), will cause damage to organisations. Not only can it damage consumer and customer confidence, but it can make it much harder to attract the most talented people to your organisation. As company statistics on gender pay gaps are now a matter of public record, candidates can easily check how well the company skews on the scale. If it’s not looking good and there’s no indication from their website and social media that they’re making an effort to change this, then people will move on and you will miss out.
Companies that practice transparency across all touchpoints, including their pay structure fare much better in the current candidate market. Compensation is still the most crucial element of an appealing job vacancy for candidates but, it also helps to demonstrate to new and existing employee’s how they can move up in the company and what they would earn if they did.
Have you looked into your company’s gender pay gap recently?