This briefing paper provides statistics on the size of the gender pay gap in the UK, looks at some of the reasons why the gender pay gap arises and discusses the duty on large employers to report on the size of the gender pay gap in their workforce.Jump to full report >>
The gender pay gap measures the difference between average hourly earnings of men and women.
Among full-time employees, women tend to be paid less per hour than men, while the opposite is true for part-time employees. Median hourly pay for full-time employees was 9.1% less for women than for men at April 2017, while median hourly pay for part-time employees was 5.1% higher for women than for men (figures exclude overtime pay). The median is the point at which half of people earn more and half earn less.
However, a much higher share of women than men are employed part-time and part-time workers tend to earn less per hour than those working full-time. Consequently, when we look at the gender pay gap for all employees, it is considerably larger than the full-time or part-time pay gaps: on this basis, median pay was 18.4% higher for men than for women at April 2017.
Broadly speaking there has been a downwards trend in the full-time pay gap since 1997 and the overall pay gap has also decreased over the period. The part-time pay gap has widened since the early 2000s, with women earning more than men.
Differences in average pay for men and women arise for various reasons, including the types of jobs that people do and the number of years they have spent in the workplace.
There is little difference in median hourly pay for men and women aged in their 20s and 30s, but a large gap emerges between men and women aged 40 and over working full-time. One reason for this is that factors affecting women’s employment and earnings opportunities become more evident among women aged in their 30s and 40s. For example, time spent out of the workplace to care for children or elderly relatives could affect future earnings when a person returns to work. Similarly, the need to balance work with family commitments and the availability of flexible working practices may restrict individuals’ employment options.
Research by the Institute for Fiscal Studies found that the pay gap between men and women widens substantially following the birth of their first child. Some of this effect is attributable to mothers spending less time in full-time employment than fathers and more time in part-time employment. Experience working part-time appears to have very little impact on growth in hourly wages compared to experience in full-time work.
Generational effects, including differences in average education levels and the occupational profile of younger and older workers, may also partly explain why the gender pay gap varies with age. Over the past twenty years there has been a more rapid increase in education levels among women than among men. More highly-educated workers tend to have higher earnings, so the relative increase in education levels for women probably explains some of the reduction in the overall gender pay gap during this time. Over the same period the gender pay gap has reduced for workers qualified to GCSE or A level standard, although it has changed little for graduates.
Another likely driver of the gender pay gap is that women are more concentrated than men in certain occupations which may attract lower levels of pay. This effect is often referred to as “occupational segregation”.
From 2017/18, public and private sector employers with 250 or more employees are required to publish data on the gender pay gap within their organisation. This duty is imposed by regulations made under section 78 (private sector employers) and section 149 (public sector employers) of the Equality Act 2010.
Although the Coalition Government had previously decided in favour of a voluntary approach to gender pay gap reporting, an Opposition amendment to the Bill that became the Small Business, Enterprise and Employment Act 2015 required the Government to use the power in section 78 of the Equality Act to make regulations obliging private companies to report on their gender pay gap. The Government ran a number of consultations on mandatory gender pay gap reporting in 2015 and 2016 (including on extending the reporting obligations to the public sector) and the relevant regulations came into force in March and April 2017.