The gender pay gap: Katja Hall, CBI Deputy Director-General writes for Mumsnet and The Great Business Debate on the real causes and solutions.
On the surface, any effort to reduce, and ultimately eliminate, the gender pay gap should be applauded. But is forcing businesses to publish data on discrepancies in pay the right way to go about this?
What’s important to understand is that a business reporting by gender on its pay rates means taking an average of what all men and all women earn across the firm – regardless of the jobs they’re doing, regardless of skills, experience, seniority or level of responsibility – and stating any difference between the male and female figure. It’s not the same as equal pay reporting. Equal pay for equal value work is already the law and rightly so.
The gender pay gap exists for a number of complex and varied reasons. It is influenced by things firms want addressed but can’t control alone — like the gender mix going into a particular role – so comparisons between firms aren’t what is important. Reporting should be flexible; it needs to be about individual firms showing they’re taking action — and that means being transparent in a way that genuinely reflects the position in the business. Without this flexibility, it is all too easy to misinterpret the results.
The gender pay gap is less about direct discrimination within businesses, and more a result of occupational segregation and traditional differences in how men and women have worked in the past. Publishing bald sets of numbers might help focus minds on diversity issues but, on its own, it isn’t going to deliver fundamental change. To achieve real progress we need to challenge occupational stereotypes by encouraging more women into male-dominated industries and investing in better careers advice.
At the moment, too many areas of work – often those with the best pay potential – are seen as male preserves, with women steered away from choices that would give them higher-paid options. Better careers advice will help remove the gender stereotyping that encourages girls to think – ‘that job’s not for me, because I want a family and flexibility’ – or ‘engineering’s a man’s world but there are loads of women in HR’. This is utterly wrong and it needs to be addressed wherever it’s found – starting in the classroom.
Firms also have an important role to play in exciting young people about the range of careers available and tackling stereotypes in schools. We need more girls studying science and technology subjects, while boys shouldn’t shy away from careers in caring professions that may have traditionally been viewed as for women.
Diversity targets have been shown to deliver. It’s an approach that has worked very well for increasing the numbers of women on company boards. This week, it was announced that Lord Davies’ 2011 voluntary target of getting women into at least a quarter of boardroom seats at the UK’s biggest firms by 2015 has been met. But we must not let our guard drop. Progress has relied on making sure new appointments are diverse, and this must continue as women appointed since the Davies report begin to end their terms on boards and replacements are sought.
The best businesses recognise the value of having a diverse board and wider workforce that reflects society and their customers and the ones that thrive are those that seek to harness the talents of all. We’ve long argued that a target for narrowing the gender pay gap is part of the answer, but to deliver fundamental change we need to understand that this alone does not form a solution.
Because perceptions of how companies recruit and treat staff influence what people think about business more generally, these are issues at the heart of the CBI’s trust-in-business campaign The Great Business Debate — which we have previously worked with Mumsnet on.
You can join the Mumsnet discussion here