Equal Pay Day: Every time the gender pay gap widens, Britain goes backwards

A woman working full-time now earns on average £5,000 less a year than a man

The pay gap is rising for the first time in five years (Rex)

More than 40 years after the Dagenham strikes and the Equal Pay Act, women’s earnings are still considerably lower than men's – with the "gender pay gap" sitting at 15.7 per cent for full-time workers. This means that women effectively work for free from now until January.

And the situation is getting worse. Equal Pay Day falls three days earlier this year, with the pay gap widening in 2013 for the first time in five years. A woman working full-time now earns on average £5,000 less a year than a man.

So why is there is still such a big earnings gap between men and women, and why is it getting worse?

One of the main contributors to the gender pay gap remains the so-called "motherhood penalty". The pay gap has almost closed for those in their twenties – sitting at 4 per cent for 22-29 age group – but opens up again around the age many women have children. For women in their thirties, the gap is 11 per cent and by the time a woman reaches her forties it stands at an alarming 24 per cent.

This gulf between male and female earnings is not an inevitable consequence of the fact that women bear children, but a reflection of outdated labour market practices that mean quality part-time and flexible working opportunities are still far and few between and of persistent inequalities in how caring responsibilities are shared that see women continue to do the lion’s share – 65 per cent of unpaid domestic work according to recent research by academics at Oxford.

Half of professional women return to work in low-skilled roles and in Fawcett’s recent survey of 1,000 low paid women – all earning below £7.44 per hour – some 22 per cent had degree-level qualifications. We need a step-change in flexible working that sees employers enter the 21st century and recognise the value of retaining talented women at all levels in their organisation. The public sector can do much to lead by example by advertising all jobs on a flexible basis, unless there is a clear business case for not doing so.

Sharing parenting more equally will require social and cultural changes, but there are also policy levers that can help. The recent changes around shared parental leave missed two significant opportunities: raising maternity and paternity pay - with the low levels cited as one of the main reasons by men for low uptake - and a "use it or lose it" component to paternity leave within the first 12 months.

These measures would do much to shift us closer to reducing the gender pay gap, but we also need to look more structurally at the economy and the shape of the recovery. Occupational segregation means that women are more likely to be working in low wage sectors, such as care, and men are far more likely to work in high-end sectors, including science and technology.

Overall, 59 per cent of those earning below the minimum wage are women. The emerging recovery is entrenching these disparities with a continued "hollowing out" of the economy taking place. Job growth has occurred principally in high-end male-dominated and low-wage, feminised sectors. The loss of jobs in the public sector, where the gender pay gap is lower (24 per cent compared to 17 per cent), is also contributing to the current widening of the gap, as is the rise in part-time working which means there are now twice as many women (789,000) who are part-time because they cannot find full-time work.

With women making up the majority of those on low pay, lifting the national minimum wage would make a contribution to closing the gap and, of course, help those who are feeling the cost of living crisis most sharply. New research published by the Fawcett Society today shows that lifting the national minimum wage to the Living Wage would close the gap by 0.8 per cent. On its own this may not seem significant, it compares to a very slow pace of change that has seen the gap drop by just 6.2 per cent over 13 years.

But, beyond this, we also need to bear in mind that discrimination still plays a role too. Last week we heard the news that ASDA shopworkers – the majority are women - are launching a legal claim alleging they are paid up to £4 less than their primarily male colleagues in the warehouse for work of "equivalent value". What is deeply worrying is that since the introduction of upfront employment tribunal fees in July 2013 sex discrimination cases have dropped by a staggering 91 per cent. There is a very real danger that women are being priced out of justice at a time when the gender pay gap shows no sign of going away.

Eva Neitzert is Deputy CEO of Fawcett Society

For statistical references, please see Fawcett’s briefing on the Gender Pay Gap, published today at www.fawcettsociety.org.uk