How is the gender pay gap doing?

Today is International Women’s Day, and the papers are full of reminders that allegedly we have a way to go before achieving real equality between the genders. One area where apparently women are still being discriminated against is pay, where the mainstream media picked up on figures released yesterday by recruitment consultancy Robert Half, which showed that the average full-time annual salary of a woman is £5,732 less than that of a man, and that over a lifetime career of 52 years, that gap translates into an earnings shortfall of £298,064.

To anyone who believes in the virtues of the free market, it immediately sounds suspicious that women should be paid less for doing the same job as men. While some entrenched structures may favour men and the odd misogynist may rule out women employees as a matter of principle, in general a gender pay gap would incentivise employers to seek out female employees and this alone would tend to bid up women’s wages until they were on par with men. So we would be more inclined to think that in fact women are not doing the exact same jobs as men, and that this is where one should look for the explanation to why they are paid less. Here are four factors which may help explain the gender pay gap in the UK.

  1. Seniority. Figures from the ONS (2008) shows that a man of age 16 could expect to be active on the job market for 40.5 years, a woman of age 16 could expect to be active for 34.2 years. Given that people usually enjoy a higher salary the longer they stay on the labour market; it would be expected that the average man would enjoy a higher salary solely based on seniority.
  2. Having children. Women who have children are absent from their jobs for up to a year after giving birth. It would be expected that this (unfortunate, but natural) disadvantage, all other things being equal, would impede a woman’s career compared to a man. Some high-paying professional fields are difficult to leave for a period in the middle of a career, while low paying jobs tend to offer more flexibility. In fact, according to Forbes, parenthood, and the reaction to having children, can explain the entire gender pay gap.
  3. Full time vs part time. According to the Labour Force Survey, in 2015 89% of men in work were in full-time employment, whereas this was only the case for 59% of women. Part-time jobs pay less per hour than full-time as they are typically low skilled.
  4. Job type. When it comes to university education, women in fact dominate, with almost 67,000 more women than men enrolled in university. However, women tend study different subjects than men. Women outnumber men in areas such as nursing (where they make up 90.5% of students), psychology (81.7%), social work (88.3%), and academic studies within education (88.7%). Men outweigh women in subjects like computer science, which has 13,085 more male students than female, engineering, electrical engineering and economics. According to the online recruitment service Reed, a nurse can expect an average salary of £21,465, whereas a software developer earns on average £46,995, and in general the male dominated fields lead to higher salaries by virtue of the type of jobs graduates are qualified for.

The crusade for equalisation of pay between men and women will of course go on. It is taken for granted that the difference in pay is down to discrimination, whereas a closer look reveals that it can be explained by the decisions women make as compared to men. In essence, the gender pay gap discussion is just another example of how it is parity of result, and not of opportunity, which is what people understand with equality today.

  1. This article is seriously comparing apples with oranges…
    No 1. Seniority: I don’t see why a woman would work shorter than a man. And besides, does every woman get children? There are a lot of women out there who don’t have children and who have exactly the same abilities, skills as well as expertise and experience to do the job and yet get paid less due to the assumption of risks associated with women?
    No.2: Men can take paternity leave..but they don’t because they LEAVE it to the women.. Society doesn’t support this either just to keep men in power.
    No.3. Full time vs part time: Duh..resulting from No 2..of course that’s the case.. it’s an easy way to make the woman dependent on the man.
    No.4. Why compare one industry with the other? Why not willing to see the differenced which occur within the same industry already?

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