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Gender pay gap widens – but it’s below pre-pandemic levels

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Written by: Emma Lunn
26/10/2022
The gender pay gap for UK workers rose to 8.3% in April, according to the Office for National Statistics (ONS).

The ONS found that the difference in average earnings for full-time male and female employees has gone up since April 2021 when it stood at 7.7%.

However, data collection issues and furlough during the pandemic make comparisons with 2019 – when the pay gap was 9% – more meaningful.

The ONS found that up until the age of 40, the gender pay gap stands at 3.2% but then widens to 10.9%.

The gender pay gap tends to be higher among better-paid employees, and is 10.6% among managers, directors and senior officials.

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said: “The gender pay gap has dropped during the pandemic, but this isn’t unalloyed good news. It’s actually up from a year earlier and is particularly striking among older women. It rises steeply when you include part-time employees, and in the final analysis, we’re all worse off.”

A wider gap ‘shocking reading’

The gender pay gap is a lot wider than the headline figure for many people. The figure is 8.3% for full-time employees, but when you include part-timers too, it expands to 14.9%. However, this is down from 17.4% in 2019.

The gap is bigger for part-time workers as women are far more likely than men to work part-time, and part-time jobs also tend to attract lower pay.

Similarly, while the gap is narrower for younger women, once you reach the age of 40, women are paid 10.9% less than men. This, the researchers said, is because after the age of 39, men are more likely than women to move into managerial roles, and get better pay.

Carla Hoppe, founder of workplace financial wellbeing provider Wealthbrite, said the gender pay gap statistics are shocking reading.

“Progress appears to be reversing before our eyes. We need to ask what is causing this?” she said.

Hoppe added: “McKinsey [think tank] reported earlier this month that women are leaving jobs in record numbers searching for greater flexibility, inclusivity and meaningful support for their wellbeing. In the same month, however, we saw former prime minister Liz Truss remove what she called red-tape for SME businesses with fewer than 500 employees, exempting them from the requirement to report on the gender pay gap. There is a saying that what gets measured, gets done, which makes this move even more depressing.”

We’re all worse off

The past year has been pretty miserable when it comes to pay, because on average we’re all worse off once inflation is taken into account. In April. average weekly pay was down 2.6% after inflation.

Pay grew fastest among lower-paying occupations, and part-time workers; the average weekly pay for part-time employees was up 6.1% to £228. However, these groups are still worse off than a year earlier, because part-time pay is still down 1.6% after inflation.

“Women who work part-time still earn less than men on average, but their wages are growing faster. Average weekly pay for full-time men was up 5% to £683, and for women it was up 4.6% to £584. However, this owes less to any real structural change in gender pay rates, and more to the fact that men worked fewer hours,” Coles said.

“Pay grew faster in the public sector, where it was up 5.9% compared to 4.6% in the private sector. This is partly due to wage settlements, but it’s also worth noting the impact of furlough. Take the accommodation and food service sectors, for example, they were heavily affected by furlough in 2021 so were up 18.7% in the year to April 2022.”

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