Boost UK productivity by tackling low pay and the gender pay gap, says report

Employers must act on low pay, gender pay and rewards packages to address the UK’s declining productivity, according to a new research paper from the Institute for Employment Studies.

The paper, authored by IES head of HR consultancy, Dr Duncan Brown, analyses trends in UK pay and rewards over the past 30 years. It shows moves across all sectors towards more market- and performance-related pay and individualised, more flexible reward packages. However, beneath the rhetoric of ‘total’ rewards and aspiring to be a ‘best-place-to-work’, greater risk and precariousness in pay was transferred to employees at the same time as pay differentials escalated and pay fairness took a back-seat, says the report.

The paper argues that more action on the areas of low pay, gender pay and total rewards should be a priority.

Dr Brown, author of the paper, says: “The UK’s productivity woes, lagging behind countries like France and Germany, are partly due to a lack of investment in skills and too many businesses benefiting opportunistically from a prevailing culture of low pay.

“IES research suggests that prioritising and balancing the goals of fairness, flexibility and affordability in reward arrangements is essential to tackle the challenges facing the UK economy.”

In another report, out today, the think tank the IPPR, says that there is little public support for any deregulation around the provisions of the Working Time Directive as part of the Brexit process.

Based on its polling, it says: “There is little to no appetite among the public for reducing or removing EU standards. Across a range of consumer, financial, employment and environmental legislation, a considerable majority of the public want to keep the current standards in place, or indeed go further than the minimum requirements specified by EU legislation. Even with respect to more controversial legislation, such as the Working Time Directive and the cap on bankers’ bonuses, there is minimal support for deregulation among the public. Only 14 per cent want to either loosen or remove the current Working Time Directive rules, and only 9 per cent want to raise or remove the cap on bankers’ bonuses.”


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