The lifetime impact of the gender pay gap

Last week was Women’s Pay Day – the day when the average woman starts getting paid compared to men. What is the cumulative effect of the gender pay gap and why do we need to understand better how everything links up?

Illustration of gender pay gap with money and seesaw - FTSE100 directors

 

It’s hard to think of anything except the terrible scenes in Ukraine, but Friday marked the annual Women’s Pay Day – the day when the average woman starts getting paid compared to the average man. The day is linked to the gender pay gap, but that varies according to many different factors, including more women working part time, the type of jobs women tend to do and how these are valued, career progression, the percentage of women at the bottom levels of pay compared to the percentage at the top and so forth.

Some sectors have bigger pay gaps than the average, including, interestingly, education – due in part to the advent of academy trusts where men predominate at the top. The worst gender pay gap, however, is in finance and insurance at 32.3 per cent.

The pay gap also varies by region which relates to the kind of industries and types of job available, with the south east having the highest gap at 18.9 per cent, according to the TUC.

And it varies by age. TUC analysis shows women aged between 40 and 49 have a pay gap of 21.3 per cent and work for free until Friday 18 March 2022. And women aged 50 and 59 have the highest gender pay gap (21.8 per cent). They work 80 days of the year for free before they are paid on Sunday 20 March 2022.

Caring responsibilities and the longer term impact of these on career progression are a key factor here. Frances O’Grady, TUC General Secretary says: “The gender pay gap widens dramatically once women become mums.” She has called for better, more affordable childcare and better pay and conditions for childcare workers as well as an overhaul of the Shared Parental Leave system.

The long-term impacts are immense and it’s not just childcare. It is gendered assumptions about who does any kind of care and, with the implications of Covid on staffing and funding of social care, unpaid care is likely to be a bigger issue in the future.

The Covid figures speak for themselves, with the number of older women in particular dropping out of the workforce in the last two years surely requiring more in-depth research. Our sister site workingwise.co.uk is currently carrying out a survey on the gender pension gap, looking at all the factors that contribute to women’s poverty and dependency in old age. Understanding how all these things join up is vital if we are to find ways to ensure women don’t continue to get caught in this cycle.



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