Employers in financial and insurance activities have some of the highest gender pay gaps, in large part because of the lack of women in senior positions, the impact of bonuses and also because of the earnings gap between those at the very top and those lower down the pay scale.
The deadline for the first gender pay gap figures closed at midnight on Wednesday. Of the 10,046 employers with over 250 employees who filed figures 415 were in the financial and insurance activities sector.
The financial services industry covers a raft of different types of business and within those businesses are very different types of jobs – and earnings. Banking, for instance, includes everything from high street or retail banking to investment banking and asset management. Women tend to be more concentrated in retail banking, where earnings tend to be lower. The senior jobs with the high bonuses tend to be taken by men.
Each area of banking has its own particular issues with regard to gender diversity. For some attracting women is a huge issue and this has a big impact on the pipeline to senior positions. In others, there is not such a big problem with attracting women graduates, but there is an issue with retention, particularly after childbirth, and with promotion into senior roles. Partly this is a cultural problem – a male-dominated culture and underlying unconscious bias towards women makes it difficult for women to progress. There have been numerous high profile legal cases of women facing discrimination and being forced out.
Here are a selection of some of the headline figures*:
Some banks have filed multiple figures for different entities and many have staff which are spread internationally, such as JP Morgan International. Lloyds Bank plc has a 37.6% gap [with 31.5% of top managers being women], but Lloyds Bank Commercial posts a gap of 27.6% and Lloyds Bank Asset Finance has a 24.2% gap. Australian bank Macquarie, which provides banking, advisory, trading, asset management and retail financial services, has filed figures for three different employer entities, plus a combined UK gender pay gap figure of 49%.
How companies are addressing the pay gap
Many employers have posted explanations for their pay gap, outlining how they are addressing the issue. Barclays, for instance, talks about creating new career opportunities to attract and retain diverse talent, including apprenticeships and returner programmes as well as reshaping its graduate programmes; building a pipeline of female leaders through talent management and leadership development; driving cultural change, for instance, through flexible working, unconscious bias training and parental support; and supporting wider societal issues through external strategic partnerships
Some employers in the financial services sector have for some time been aware of their gender diversity problem and been looking at different ways to get more women into senior positions. Returner programmes, for instance, originated in the sector. Progress has often been slow, however, and many recognise that the kind of change required to cultural and social norms and practice will be a long process requiring constant review and weighing up of what works.
Several employers in the financial services sector have featured in the Workingmums.co.uk Top Employer Awards and we have highlighted the different ways that they are attempting to drive greater gender diversity. Key issues are agile working, director level buy-in to diversity initiatives, management training in unconscious bias and flexible working, sponsorship programmes for women and encouragement and financing of shared parental leave policies.
Lloyds Banking Group won Workingmums.co.uk’s Overall Top Employer Award in 2017. Read about how it is working towards greater gender diversity at all levels here.
Bank of America Merrill Lynch won Workingmums.co.uk’s Top Employer Award for Career Progression. Read what they are doing here.
M & G Investments won Workingmums.co.uk’s Top Employer Award for Family Support. Read what they are doing here.
*Figures in this article are based on statistics for the mean hourly rate. The mean gender pay gap is a measure of the difference between women’s mean hourly wage and men’s mean hourly wage. The gender pay gap includes a figure for mean hourly pay and for median hourly pay. The median gender pay gap is the difference between women’s median hourly wage (the middle paid woman) and men’s median hourly wage (the middle paid man).