Pay gap between men and women falls to all-time low

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The Independent Online

The gender gap between male and female earnings is narrower than ever, according to the Office for National Statistics.

The ONS's latest survey reveals that men earn on average 17.2 per cent more than women – down from 17.5 per cent a year ago. That figure includes a significant number of very high male earners. Stripping out the extremes at either end of the labour market reduces the gap somewhat – to 12.6 per cent, again a little lower than in 2006 (12.8 per cent).

For part-time workers, the gap is 35.6 per cent. The preponderance of women in traditionally badly rewarded occupations and in part-time work are major factors in the gender gap.

The TUC general secretary Brendan Barber said: "Progress on closing the gender pay gap has slowed to a snail's pace. Greater transparency and fairness in pay systems will help employers to eliminate pay discrimination, but the voluntary approach has failed, so mandatory pay audits are needed."

Typical gross male annual earnings in 2007 were £26,300, with the equivalent figure for women running at £20,500. The average British annual wage can be said to be £24,000 – up 2.7 per cent on the year.

Such modest increase in pay is interpreted by some as evidence of a weak labour market. Dr John Philpott, chief economist at the Chartered Institute of Personnel Development said; "Whichever way you cut the annual pay survey figures, it is clear that the pay of most workers failed to match the surge in price inflation and other living costs in 2006 and early 2007. This confirms that conditions in the labour market were not tight enough to trigger the kind of pay surge that was widely predicted."

Globalisation, migration and increasing participation rates (especially among older workers) have kept pay rises down. Broadly, private-sector pay settlements are outstripping public sector ones.

In terms of low pay, the number of employees paid below the average wage (that is legally, for example apprentices) has remained fairly steady at 292,000. However, there has been a substantial trend for lower workers to fall into the category of being remunerated at or very close to the minimum wage. Taking a band from the minimum wage rate (currently £5.35 per hour) to a rate 5p per hour greater than that (so, currently £5.40) the ONS finds 565,000 people, up 111,000 on last year and 225,000 more than in 2004.

Some 796,000 British workers can be said to be low paid – being paid below, at, or very slightly above, the national minimum wage. According to the ONS, what seems to have been happening is above-inflation increases in the minimum wage have been paid by employers, but with correspondingly lower increases for those quite near to that level, who have seen their differential eroded as a result.

The lowest and highest paid mainstream occupations remain fairly predictable: directors and chief executives of major organisations enjoy salaries equivalent to £1,916 per week, with senior civil servants rubbing along on £1,236 and pilots making ends meet on £1,078. Bottom of the pile are hairdressers and barbers on £221.

London once again is the best-paid region, with typical weekly earnings approaching £600, 28 per cent above the UK level; Northern Ireland has the worst pay, at £402 per week. Scotland, traditionally a comparatively poorly paid nation, has moved closer to the national average. However, the worst-paid regional sub-category of workers is part-time women in Wales, with a typical weekly wage of £356.

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