Reducing gender pay gap would add ‘£150bn to UK economy by 2025’

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Nearly 80 per cent of women say business and employers should bridge the persistent gap in pay, finds report

The gender pay gap – which currently stands at 19.2 per cent – will be “with us for a lifetime” and cause significant damage to the UK’s productivity levels if government and employers fail to take action, a gender equality and women’s rights charity has warned.

The Fawcett Society has also revealed new research that found 77 per cent of women, and 66 per cent of men, believe it’s the responsibility of businesses and employers to reduce the gender pay gap. More than two-thirds (68 per cent) of women, and 56 per cent of men, said solving the issue was the government’s responsibility.

Fawcett Society chief executive Sam Smethers said: “The gender pay gap is a productivity gap – it represents the wasted potential of women’s talents and skills. Research shows that reducing it would see over 800,000 more women in work and add £150bn to our economy by 2025, which shows the majority of women are going to be looking for employers that are taking action to address it.”

Mandy Garner, editor of Workingmums.co.uk, said closing the gap is “particularly in the interests of employers”, because “they will miss out on talent if there is a feeling that women are treated differently than men.

“The issue has to do with so many different factors, but the move to gender pay audits is one step that employers of all sizes could take, if not for publication then for their own internal records. They need to keep detailed records relating to pay and gender, and ensure career progression is an integral part of what they offer employees. They could also facilitate networks, mentoring and sponsorship for women.”

The survey found that 56 per cent of female employees and 48 per cent of male workers believe individuals have a collective responsibility to reduce the gender pay gap. Nearly two-thirds (59 per cent) agreed with the statement: ‘It matters to me that my employer or potential future employer is taking steps to reduce the gender pay gap in their organisation.’

Almost a third of women (30 per cent) said they felt their employer could do more to encourage the career progression of women, compared to 26 per cent of men.

A separate ICM poll found that women and younger people were significantly more likely to look for an employer that is taking action to close the gap, as the government prepares to publish new regulations requiring large employers with more than 250 employees to publish their gender pay gap figures from April 2018.

Denise Keating, chief executive of the Employers Network for Equality & Inclusion, said: “It is in employers’ interest to [work to close the gap] as research has repeatedly shown that diverse teams lead to greater innovation and impact positively on the organisation’s bottom line.”

Keating said there were several reasons that gender inequality and the pay gap exist. “Alongside the more well-known initiatives, such as increasing the number of women on boards and increasing female participation in STEM, a huge problem in the UK is unequal caring responsibilities, with women as primary caregivers both to the young and the elderly,” she said.

“Employers have been reluctant to provide shared parental leave at a pay rate that matches the enhanced pay that many would give for maternity leave, reinforcing the requirement for women to be primary caregivers for children, which in turn affects their careers.”

Meanwhile, HSBC, Santander, Lloyds and RBS are among the finance firms committing to have women fill at least 30 per cent of senior roles by 2021. An additional 13, including Legal & General and Virgin Money, are aiming for an equal split between men and women in senior posts.

Prime minister Theresa May said: “The UK is a world leader in financial services, but the sector could do even better if it made the most of the many talented women who work in finance. Too few women get to the top and many don’t progress as quickly as they should or they leave the sector completely. I want to see a diverse sector run by talented men and women.”

Financial services is the highest-paid sector in the UK but also has the biggest gender wage gap at 39.5 per cent.

 

Story via – http://www.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2016/10/13/reducing-gender-pay-gap-would-add-163-150bn-to-uk-economy-by-2025.aspx

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