Report highlights gender pay growth gap

The ‘scarring effect’ of childcare responsibilities on career progression and the ability to work full time means annual pay growth for women has risen by just 18% since 2010 compared to 42% for men, according to a new report.

The report by Public First tracked pay for women and men in their 20s from 2010 and says that, unless the high costs of childcare are addressed, the pay rise gap is unlikely to change anytime soon.

The report finds that individuals who have stayed in the workforce have seen real pay growth of 15% in the period between 2010/11 and 2020/21. However, those who remained in the public sector, where women tend to predominate, have seen weaker wage growth than their private sector peers. For instance,  the report says that, while the median worker in public administration had a similar wage to the median worker in professional services in 2010/11, by 2020/21 real wages for the same set of public administration workers were 15% lower than their peers in professional services – amounting to £5,600 per year (this excludes pensions). And the median residential care worker fell behind the median hospitality worker in terms of pay over the decade.

The regional picture was more complex. While Londoners saw the fastest real wage growth over the past decade, Yorkshire & Humber and the North East occupied second and third place. Wage growth in Wales was higher than that seen in the South East and East of England, while the Midlands and South West of England saw relatively weak wage growth.  Those who had moved region between 2010/11 and 2020/21 saw similar pay growth to Londoners, and the median worker in this cohort had the highest pay in absolute terms.

In terms of age and taking into account career progression, younger workers saw much faster wage growth over the past decade than older ones. Those who were in their 20s in 2010/11 saw pay rise by close to 38% a decade later, after adjusting for inflation, whereas those who were in their 40s in 2010 saw their real earnings rise by just 2% a decade later. The report says this suggests employers may need to give more thought to ensuring that workers in their 40s, 50s and 60s have better access to progression opportunities, although health and caring responsibilities leading to reduced hours and reduced hours leading to retirement may also be factors.

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