Gender pay gap worsens as new data includes bonuses and perks

New ways of measuring income which include basic salaries, bonuses, perks and commissions show that the gender pay gap for the UK’s 3.3m managers is nearly £3,000 bigger than previously thought, according to new analysis.

Two stacks of coins with gender symbols above them


According to analysis of managers’ salaries conducted by the Chartered Management Institute (CMI) and XpertHR, the gender pay gap as calculated under the new regulations stands at 26.8 per cent, with male managers on average out-earning female peers by £11,606 a year. This includes salary and bonuses, as well as perks such as car allowance and commission.

Previous analyses of the pay gap based on managers’ basic salaries had put the gap at 23.1 per cent last year, or £8,964. That gap has increased slightly to 23.6 per cent this year, or £9,326.

Under the Government’s reporting regulations that came into effect in April 2017, large employers (250+ employees) must now publicly disclose the size of their gender pay gap. As of 21st September, just 77 out of the 7,850 UK companies to which the new law applies have fulfilled their obligations.

The analysis is based on salary data of 118,385 managers from 423 organisations over the past year.

CMI’s chief executive Ann Francke said: Too many businesses are like ‘glass pyramids’ with women holding the majority of lower-paid junior roles and far fewer reaching the top. We now see those extra perks of senior management roles are creating a gender pay gap wider than previously understood. The picture is worst at the top, with male CEOs cashing-in bonuses six times larger than female counterparts’.

“Our data show we need the Government’s gender pay gap reporting regulations more than ever before. Yet, less than one per cent of companies have reported so far. Time for more companies to step up and put plans in place to fix this issue. It’s essential if UK companies are to survive and thrive in the post-Brexit world.”

 The findings also reveal that women are far more likely to fill junior management positions than men (66 per cent vs 34 per cent), and men much more likely to occupy senior positions (26 per cent of director-level roles occupied by women, 74 per cent by men). Yet, even for those women who do progress to more senior roles, the analysis shows the pay gap begins to widen considerably: at director-level positions, it rises to £34,144, with men earning an average of £175,673 and women £141,529.

The CMI and XpertHR says bonus payments are also exacerbating the problem, with the gender bonus gap across all managers standing at 46.9 per cent. This increases considerably at C-suite level, where the average bonus for a male CEO is £89,230 compared to £14,945 for a woman – an 83 per cent bonus pay gap.

This year’s analysis suggests that while pay rises are picking up for both men and women, the benefits are going disproportionately to men. Male directors picked up a 5.8 per cent increase in pay and bonuses, compared to 3.7 per cent for women (compared to 2.6 per cent and 2.4 per cent respectively last year). For managers, men outpaced women by 3.7 per cent to 3.5 per cent (when they each took home 2.4 per cent increases the year before). That means a real-terms widening of the gender pay gap for many managers.

Breaking the data down by sectors, the analysis shows that the gender pay gap is particularly high in the financial sector [33.9%]. In retail the pay gap is ; in 19.4%; in marketing 17.3%; in HR 10%; in PR, press and publishing 13.9%; and in IT 8.2%.

XpertHR Content Director Mark Crail said: “We have always known that the gender pay gap appears to widen with seniority. But the results we are publishing today enable us to quantify the gap using a large volume of reliable, checked and verified pay data, drawn directly from employer payroll systems. Some people have tried to explain the gender pay gap away as being the result of different working hours or individual career choices. But when the analysis is based on the pay of more than 100,000 individuals in well over 400 organisations, it is clear that the pay gap is a very real fact of life for UK managers.”

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