Women's work? Latest pay gap data reveals women work for free 1h 40m a day

Women managers are effectively working for free nearly two hours every day, new gender pay gap data reveals.

The findings of an annual survey of 72,000 UK managers published by the Chartered Management Institute (CMI) and salary specialist XpertHR, reveal that women working in equivalent full-time roles earn 22% less than men, meaning that they are unpaid for 1h 40m a day – a total of 57* working days every year.

Analysis of the data from the 2015 National Management Salary Survey, highlights pay imbalances across the UK’s professional workforce. For men and women of all ages and in all professional roles the gender pay gap now stands at £8,524, with men earning an average of £39,136 and women earning £30,612. In 2014, the pay gap stood at £9,069, or 23%.

The pay gap rises to £14,943 for senior or director-level staff, with men earning an average of £138,699 compared to the average for women of £123,756. Women managers are also missing out across all levels when it comes to bonuses, with the average man’s bonus of £4,898 almost twice that of the average woman’s bonus of £2,531.

The survey data also reveals that the pay gap becomes wider as women grow older. Women aged 26-35 are paid 6% less than their male colleagues, rising to 20% for women aged 36-45. The gap increases to 35% for women aged 46-60, equivalent to working 681 hours for free compared to their male colleagues. For women and men in their 60s the pay gap expands to 38%.

Not only are older women earning less, but there are also fewer of them in executive positions. Even though women comprise 67% of the workforce in entry-level roles, and continue to outnumber men in junior management roles, female representation drops to 43% at the level of senior management. Just 29% of director-level posts are held by women. In March, the publication of Women on Boards: Davies Review Annual Report 2015 revealed that the number of women holding board-level positions in FTSE 100 companies reached 23.5% - just short of the 25% target.

Ann Francke, chief executive of CMI, commented:

“Working for free two hours a day is unacceptable. While some progress is being made, it’s clear from our research that Lord Davies is right to target the executive pipeline. Having more women in senior executive roles will pave the way for others and ensure they’re paid the same as their male colleagues at every stage of their careers.”

Mark Crail, content director of XpertHR, commented:

“An entire generation has now worked its way through from school leaver to retirement since the first equal pay legislation came into effect in 1970, yet the gender pay gap persists, and many employers still prefer not to know just how bad it is in their organisation rather than getting to grips with the data and doing something about it. HR and reward specialists in larger companies have a special responsibility to get this firmly on to the senior management agenda and to develop the plans needed to close the gap.”

In other findings, the pay gap is widest for employees of organisations with between 250 and 999 staff, with women earning on average 27% less working for these employers – making them 5% worse off than even the national average.

This should be particularly alarming news for large organisations. New legislation coming into force in 2016 will require organisations with 250+ employees to report publicly on what they pay male and female staff. Over 7,850 organisations, which collectively employ more than 11.2 million staff (40% of the UK’s workforce), will be affected by the new legislation.

The Government has yet to announce the details of the reporting requirements but the consultation outlined proposals closes on 6 September. To help organisations prepare now for the coming changes, CMI has developed a set of eight best practice principles that set out a framework for gender pay reporting that will likely go beyond any legal requirements. These include recommendations on updating data collection on staff salaries and setting performance targets [see additional information]. 

Ann Francke added:

“Transparency is a powerful driver for closing the gender pay gap. The Government’s new reporting legislation is a welcome step forward and will be good news for business. Clearer employee data, improved recruitment and a reinvigorated focus on business culture will help unblock the talent pipeline and support more women to become senior managers and leaders.”

Visit www.managers.org.uk/mindthepaygap for the infographic and reporting recommendations.

Join the conversation online by following @cmi_managers and @XpertHR, and using the hashtag #mindthepaygap

*Based on an average full-time working week of 37.4 hours; ONS Labour Market Statistics August 2015

Further information

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Additional information

To help employers take action to close the gender salary gap CMI’s recommendations are:

  1. Check your data processes – can you report on and analyse your gender pay data under current systems? Good data is essential.
  2. Segment your workforce – you can’t fully understand gender pay data without segmenting it by seniority levels. If there is a gap, is it caused by particular grades?
  3. Align pay and pipeline data – look at the talent pipeline and assess if there are barriers stopping women from reaching senior roles.
  4. Track changes – one year’s data is only a snapshot. Use previous years’ data to analyse trends and identify areas for action.
  5. Set targets – it’s vital that there are clear targets for change across the business. Use them to monitor progress and drive change.
  6. Review starting salaries – men often negotiate higher starting salaries, so make sure recruitment processes aren’t creating a gender pay problem.
  7. Start reporting – show your commitment to fairness for all employees by publishing gender pay data before the legislation comes into effect.
  8. Change outdated cultures – the working environment has to be more inclusive. Flexible working, support for parents and carers and mentoring by senior managers are fantastic ways to retain and develop employees – of both sexes.
  • The National Management Salary Survey 2015 is based on data provided for 72,206 individual employees, submitted by 317 organisations. Participating organisations are geographically diverse and from all sectors.
  • CMI – the Chartered Management Institute – is the only chartered professional body for management and leadership, dedicated to improving managers’ skills and growing the number of qualified managers.
  • Our professional management qualifications span GCSE to PhD equivalent levels, including the unique Chartered Manager award which increases earnings potential and improves workplace performance.
  • We provide employers and individual managers with access to the latest management thinking and with practical online support which helps them embrace change, create high performing teams and keep ahead of the curve.
  • With a member community of 120,000+ managers and leaders, we promote high standards of ethical practice through our Professional Code of Conduct, and help managers build their expertise through online networks, regional events and mentoring opportunities.
  • XpertHR is the award-winning employment intelligence service for HR professionals. XpertHR Salary Surveys provide detailed pay data used by employers in reviewing and setting pay levels. Visit www.xperthr.co.uk/salarysurveys for more information. The survey can be purchased by calling 020 8652 4653