How big is the gender pay gap?
I’m taking part tomorrow in a Women’s Hour discussion on part-time work, so I thought I’d use this post as a way of clarifying for myself what the position is on the gender pay gap, using the recent ONS report on earnings. For the mathematically challenged such as myself some of the figures need a bit of puzzling out, but don’t switch off – I think it’s worth persevering.
First, the ‘headline’ figure which has attracted attention is the increase from 9.5% to 10% of the median hourly earnings of full-time employees. It’s right, of course, that we should be emphatically reminded that progress towards equality is by no means guaranteed. But the 10% was quite widely reported as the gender pay gap, and this misrepresents the overall position. If you take all employees, i.e. part-time as well as full-time, the figure is almost double, at 19.7% (up very marginally from 19.6% in 2012). Surely, since part-timers represent over a quarter of the workforce, this should be the main benchmark.
Secondly, the pay gap is actually ‘negative’ if you compare just part-timers. Part-time women’s median hourly earnings are 5.7% above that of male part-timers. This means that for those few men (6% of the total) who work part-time, their earnings are generally extremely low – i.e. they tend to be marginal members of the workforce, and to work in female-dominated occupations.
But here’s a twist. If you look at the mean (average), and not the median (the mid-point), the picture changes. (This is ONS Table 8.) The overall gender pay gap remains quite similar, at 19.1%. But the ‘negative’ pay gap for part-timers turns into a ‘positive’ one (these terms start to look rather strange to me…). Men part-timers have higher mean hourly earnings, by 5.2%. I assume this is because a few male part-timers are very high earners, so that even though most female part-timers do slightly better than their male counterparts, at the top end there is a huge discrepancy in favour of men.
Still with me? In that case, have a look at Table 9, which shows the distribution of earnings, going from lower to upper. For those just above the bottom, the differences are small, and zero for part-timers. At the media, as we have already seen, they are at 10% for full timers, negative for part-timers but 19.7% for all. Near the top (but still far far away from the real big earners), they are much much bigger. The 23.4% is bigger than either of the others, because many more men than women are full-time.
Table 9: Gender pay difference by distribution of median gross hourly earnings (excluding overtime), UK, April 2013 Full-time Part-time All
10th percentile 6.6 0.0 7.2
Risking serious overload, here’s one more set of figures which I think are really important. They are not about the full-time/part-time gap, but the way the gender pay gap changes across age groups. I’ve calculated them from ONS Table 12. They are median hourly earning, for full timers (yes, I’m sinning against my own principle, but it’s forced on me – the part-time figures are not there!) For those aged 22-9, the gap is 6.0%. This rises to 8.0% for 30-39 year olds. And then: for 40-49 year olds it triples, to 23.4%, and 50-59 goes up again to 24.6%. For 60+ it drops to 21.1%.
That’s a pretty dramatic profile. Some of it is because the current generation of older women have fewer qualifications. But the 40-49ers will already have caught up with men in terms of qualifications. The key Paula Principle question, though, (almost the key PP question) is will we see the age profile of the gender pay gap change, to reflect women’s competence levels?
I hope I’ve got all that right. Tell me if not.