Only greater transparency will close the gender pay gap

16 Jan 2019 By James Innes

Watch the next round of reporting with interest, says James Innes – it will show whether we are making any progress on a critically important issue

The gender pay gap has recently made the headlines again in the wake of the World Economic Forum’s (WEF’s) Global Gender Gap Report for 2018. And it’s not good news. Despite all the progress towards the goal of gender equality, it appears things have started to stall a little. In fact, if things continue at the current rate, it has been calculated it will now take more than a century to close the gap.

Since it first became a hot topic more than two decades ago, the gender pay gap has been described as ‘appalling’, ‘obscene’, ‘absolutely outrageous’ and a ‘burning injustice’. One 2018 headline in The Telegraph read like a bad joke: ‘What do the gender pay gap and Brexit have in common? As a nation, we’re terrible at negotiating’.

It isn’t just about high profile cases like Gary Lineker and Kirsty Wark in the UK, or Hollywood’s Jennifer Lawrence and Bradley Cooper. In the context of the average UK pay packet, it is said that women are earning approximately £5,000 per annum less than their male counterparts. That’s a statistically very significant proportion of the average salary.

It is of course vitally important to take into account that the gender pay gap is so much more complex than just some men being paid more than some women for doing the same work. This is, of course, decidedly illegal, and it also serves to obscure a much more important issue: men are significantly over-represented in the best-paid jobs and there is an accompanying and well-publicised shortage of women in senior positions.  

The higher the rank in an organisation, the fewer women there will be. The WEF’s 2018 report highlights that only 34 per cent – barely a third – of global managers are women. If the gender pay gap is ever going to be properly addressed, this is definitely the most important, and arguably most difficult, area to tackle. 

Naturally, there are variances from one sector to another, with the largest gap in STEM (Science, Technology, Engineering and Mathematics). There are, quite simply, fewer women working in these growth industries. In the future-critical field of artificial intelligence (AI), for example, women make up only 22 per cent of the workforce globally. Automation is also problematic for women, as it is increasingly taking over jobs they are more likely to perform. 

If the current rate of progress suggests the gender pay gap is unlikely to be resolved in our lifetimes – or even our grandchildren’s lifetimes – it is clear something must be done to accelerate that rate of progress. In the UK, there already exist a number of initiatives aimed at getting more women into STEM careers – starting with encouraging more girls to study the subjects post-16. The UK is reported to be on target to reach a million women in STEM by 2020. That’s a pretty good start and it’s obvious that the knock-on effects should be largely positive.

But it is also important to remember this whole issue isn’t just about what is fair or unfair. It is about distancing ourselves from the errors of the past, combatting sexism in one of its purest and most insidious forms, and promoting vital diversity in the workplace. With gender diversity comes a better choice of skilled workers, improvements in productivity, service quality and overall financial performance, as well as greater scope for creativity and innovation.

Don’t forget, back in 1970, the UK’s gender pay gap was nearly 50 per cent. We have come a long way, but there is still a long way to go. The introduction of compulsory gender pay gap reporting is helping push things in the right direction but, at present, this barely covers half of UK workers. I must advocate substantially increasing this kind of transparency so the problem can be more precisely analysed and defined. It’s only by achieving a better and more comprehensive understanding of the problem that we can hope to develop and implement more effective solutions.

I am very much looking forward to the next gender pay gap data becoming available in April.  Will it show the gap closing? Most likely. But what will really be of interest is the rate at which it is closing. Change can be slow to implement and we are unlikely to see much in the way of acceleration until we’re into the 2020s. It seems firms are taking on board government guidance on closing the gap – but there most definitely aren’t any overnight solutions.  

James Innes is the author of a range of careers books and founder of the James Innes Group

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