Tag: gender pay gap

Employers should increase their monitoring of pay, progression and training by age

According to research by the National Institute of Economic Research, women over 50 in Scotland require greater support in the workplace to address persistent inequalities in pay and progression. The research was conducted on behalf of Scotland’s Fair Work Convention.

Older workers now comprise around a third of the Scottish workforce, with the number set to increase in the coming years. However, existing data shows that women in this age group often experience greater inequalities in pay than younger women in relation to men. The report called for employers to take action to improve the experiences and opportunities for older women at work.

The research report covered women over 50 and employers in two specific sectors in Scotland: the finance/insurance sector; and the information/communications sector.

According to the research, women over 50 face a number of barriers to better pay and progression in the workplace. In particular, the report inferred that employers need to increase opportunities for flexible work for this age group, given that these women often have substantial caring responsibilities for their children, spouses, grandchildren and elderly parents. The report also explored women’s concerns in several areas, including:

  • Recruitment and promotion processes
  • Skill-gaps compared to younger workers
  • Menopause

The research found that while many women are concerned about age discrimination, employers often fail to consider age as an important aspect of diversity and inclusion in the workplace. The report recommended that employers should increase their monitoring of pay, progression and training by age. It also suggested that employers would benefit from increased support and guidance in addressing age discrimination in the workplace.

Katharine Stockland, Senior Social Researcher at NIESR, commented: “In order to address these challenges around pay and progression experienced by this group of women, employers must reflect on their workplace practices and consider to what extent their training, support and promotion opportunities reflect the needs of this group of women. Especially in the context of labour shortages that have been driven partly by older workers dropping out of the labour market, employers should act now”.

Mary Alexander and Patricia Findlay, Co-Chairs at Fair Work Convention also made comment: “We know the challenges faced by women at work do not simply start when a woman turns 50. The impacts of workplace policies and practices that systematically disadvantage women build cumulatively over an individual’s career. What this research demonstrates is that the intersection of age and gender is uniquely shaping women’s experiences of work in ways that are leaving older women significantly worse off both in career progression and in pay.”

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Research highlights retirement perceptions as Europe becomes more grey

According to new research by Alight Solutions, in collaboration with the University of Granada, 27% of European employees lack confidence that they will receive a pension when they retire. Furthermore, almost two-thirds believe their pensions will not be enough, meaning they will have to drop their standard of living.

Alight’s Retirement Perception Index was carried out amongst 2,400 employees in companies across multiple sectors from the United Kingdom (UK), Germany, France, Italy, Spain, and the Netherlands. The research highlights the state of retirement perceptions in the region.

The topic of employees’ trust in their state pension systems and interest in additional support for retirement planning is growing in importance, especially as persons over 60 are likely to account for 35% of the population in the region by 2050.

The research found that the lack of confidence in receiving state pensions was highest in Italy (38%), followed by Germany (32%) and Spain (30%), the UK (25%), and France (24%).

Dutch employees were the most confident because they had the best understanding of their pension systems.

According to the research, confidence levels differ regionally, depending on factors such as generation and gender. For example, boomers have the highest confidence in national pension systems, whereas Generation Z has the lowest confidence level among all generations.

Regarding gender, men showed higher mean values across all aspects of the index, indicating that men are more confident in the national pension systems and are more interested in employer-sponsored pension plans than women.

More than half of European workers know they need to make additional contributions but either cannot afford it or lack knowledge on where to invest. More than half of the respondents indicated that they would like to work for companies that can offer them professional advice on managing their pension plans.

Results indicate that UK employees are most interested in employer-provided retirement contributions and advice, and 29% believe they will have enough pension funds available to maintain their standard of living. Fifty percent of respondents believe they won’t be able to retire until after 66, which is when people can start claiming State Pension in the UK.

Ken Brotherston, CEO at TALiNT Partners made comment: “The issue of pensions has long been a ticking time bomb for many western economies and presents significant challenges for governments. On a more positive note, there is a growing recognition that a huge number of older people can still be econimically productive and fulfill meaninful jobs. Organisations like 55/Redefined are at the vanguard of this movement and deserve a lots of support.”

 

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Only 41% of women negotiate salaries for new roles, research reveals

Only 41% of women negotiate their starting salaries for new roles, compared to 61% of men, leaving women at a greater risk of a cost-of-living crisis. This is the finding from new research commissioned by Reed.co.uk.

The study also found that 27% of women are uncomfortable discussing their salary with employers. In comparison, only 13% of men felt the same. Yet, 90% of employees who did negotiate their most recent salary said that they were successful in receiving an increase.

The research among 250 hiring managers and 2,000 job seekers indicated that 51% of people have never negotiated wages for a new job. The ‘ask gap’ is obvious in these statistics, too, with 59% of women saying they had never negotiated salaries when offered new roles, compared to 39% of men.

When it comes down to the money, the most common salary increase in salary was between £1,000-£2,499 (42%). A further 27% received a raise of between £2,500-£4,999. Of these numbers, 42% of men were more likely to secure these pay increases than 31% of women.

The research indicates that salary negotiation is a sought-after skill. Seventy percent of workers agree that salary negotiation should be taught in school. Minority workers particularly value education on the subject, with 74% of women stating that salary negotiation should be taught in school, compared to 65% of men. Similar results were seen with:

  • 78% of LGBTQ+ vs. 70% of straight respondents
  • 83% of BAME vs. 77% of white respondents
  • 82% of disabled vs. 69% of non-disabled respondents

In support of this, 77% of employers look upon candidates positively when the candidates negotiate their salaries during the recruitment process.

When looking at age-related responses, the trends relating to salary discussions seem to be changing. Younger employees are much more open to discussing their salary, with 91% of employees aged 18-34 disclosing their earnings to someone, compared to only 26% of older workers (aged between 55-64).

Between partners, 58% of job seekers share salary details, and 44% share their salary with their families.

Simon Wingate, Managing Director of Reed.co.uk, commented: “The latest Reed.co.uk data sheds new light on how the gender ‘ask gap’ is perpetuating unequal pay. While the government has taken important strides through the pay transparency pilot, the research shows that more needs to be done to address the disparity in confidence between men and women when discussing salary.”

“By introducing salary negotiation skills into school education, future generations across society will be able to understand and implement negotiation strategies during the hiring process – and across other life experiences such as purchasing a house or car. This will enable them to secure a higher starting salary and help close existing pay gaps.”

“At a time when the cost-of-living is rising, the study also shows the value in employees pushing their future employers for a salary increase when being offered a new role and confirms that finding a new job is one of the best possible ways to secure a pay rise. Reed.co.uk has a wealth of career advice on the subject of salaries to help people get paid what they’re worth.”

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Lack of salary increases and growth opportunities identified as top issues

Two new reports published by 360Learning have indicated that the Learning and Development sector has some challenges to deal with. The reports revealed that 42% of UK L&D professionals had not received a pay rise in recent months, and a further 23% believe they do not have opportunities to develop at work.

The reports, which look at salaries, progression, and satisfaction in corporate Learning and Development (L&D) teams across the US and UK, have the following findings:

In the UK:

  • The most common annual salary range was found to be between £30-£39k a year
  • The average salary comes in at £31.6k
  • People working in voluntary sectors were likely to earn less than £39k
  • People in the private sector had the best chance of earning more than £80k
  • 25% of L&D Managers earned between £50-£59k
  • Administrators in the L&D environment earned the least at below £39k

In the US:

  • The most common salary range was $70-$100k
  • The mean salary across all roles was much higher than the UK average, at $91.2k
  • 41% of L&D Managers earned more than $100k
  • Instructional Designers and Learning Specialists in the L&D environment earned the least, at less than $70k

The gender pay gap is also clear in the results with:

  • One-third of UK women earn less than the national average (£31,285) compared to only a fifth of men
  • Half of the women in the UK earned less than £39k, compared to only 36% of men
  • Only a quarter of women said they earn more than £40k, versus 41% of men in similar roles

When looking at reasons for lack of advancement, in the UK, 6% of women report that childcare and family are stopping them from growing at work, compared to just 1% of men.

In the US, 4% of people cite personal or family reasons for preventing advancement.

The studies also looked at salary satisfaction. Interestingly, despite gender and role disparities, 53% of L&D professionals in the UK and US were satisfied with their salaries, with the satisfaction increasing per age bracket.

In the UK:

  • 56% of men and 55% of women were satisfied with their earnings
  • 58% of men and 59% of women between 25 and 45 were also happy with their incomes.
  • 42% of UK professionals haven’t had a pay rise in more than 12 months
  • Of the professionals who had not had a pay rise, 54% admitted that they’re not comfortable asking for one
  • Among the professionals who did receive pay rises, 52% were below the rate of inflation, with 45% as low as 1%-3% – half the rate of inflation

In the US:

  • 80% of professionals have had a raise in the past two years
  • 20% have had no raise at all or last had a raise three or more years ago
  • If they have had a pay rise, 38% saw a 1-3% increase
  • 10% of professionals had enjoyed a salary increase of 10% or more over the past 12 months. 41% were “comfortable” or “very comfortable” about asking for pay rises

As far as the impact of education and career experience on salary is concerned, the survey found that 74% of higher salaries across the UK went to people aged over 45; however, 73% of the over 45s surveyed had been in the L&D industry for less than a year.

It would appear that qualifications do not have much influence on compensation. Most of the UK respondents don’t have an L&D-related degree. Of the respondents who earned more than £70k a year – only 7% had degrees or higher. However, in the highest salary bracket, only 2% of people without an L&D-related degree earn more than £80,000 compared to 6% of respondents who do. Clearly,  L&D degrees can lead to higher salaries when it comes to senior roles.

In the US, where wages were higher than $70k, there were almost equal numbers of people with L&D degrees and those without, indicating that on-the-job training via mentors, upskilling, and learning management systems can be an effective route to progression.

The survey provided insights into the roles of mentors in earning potential. For example, the respondents who had a salary of more than $100k a year were more likely to have mentors than those earning lower salaries. Similarly, professionals with a 4% or higher salary increase in the previous 12 months were also likely to have had a mentor.

Generally speaking, mentorship numbers are higher in the US than in the UK. Of the US respondents, 65% of professionals agreed that they benefitted from mentoring, while only 47% in the UK said the same. These numbers could correlate with the fact that 20% of male and 21% of female L&D professionals in the UK feel that they lack opportunities to progress in their careers.

With 4% of US respondents and 22% of UK respondents saying they want to leave L&D, it is essential that L&D professionals feel empowered to effectively provide training and support to other employees.

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Employers told to voluntarily report ethnicity pay  

Ever since the Gender Pay Gap Reporting Regulations were introduced in 2017 the industry has been discussing whether the UK Government would introduce mandatory ethnicity pay reporting requirements for UK employers. Over the years, there have been several calls to action and lobbies for the Government to do so but pleas have fallen on deaf ears as last week, the Government confirmed that “at this stage” it will not be introducing a mandatory requirement for UK employers to report on their ethnicity pay – much to the dismay of many industry bodies, regulators and employers.  

Considering the sharp focus on DE&I post COVID-19, this decision is somewhat disappointing as Laurie Ollivent, Senior Associate, Employment & Incentives and the Diversity Faculty at Linklaters commented: “Whilst the Government hasn’t ruled out introducing mandatory ethnicity pay reporting in the future, it is clear that we should not expect it as a legal requirement in the UK anytime soon. But what the Government has said is that for those employers who choose to voluntarily report on their ethnicity pay gap, they are supportive of the recommendation that employers should publish accompanying action plans and a diagnosis which explains any pay gap and addresses any disparities, and once employers are equipped with a trustworthy, consistent standard for reporting, they should take meaningful action to identify and tackle any causes of disparate pay. In other words – employers need to focus on their narratives. Whilst we accept there are challenges to ethnicity pay reporting beyond those employers face with gender pay reporting which means that the data alone will only ever be a blunt tool to identify potential disparities, the expectation of a narrative without further guidance on what this should look like and the requirement for employers to tackle any causes of disparate pay and report on progress may be off-putting for some businesses considering whether to voluntarily report on their data at this stage and risks halting progress on voluntary reporting rather than encouraging it.  

Simon Kerr-Davis, Counsel, Employment & Incentives and the Diversity Faculty at Linklaters also made comment: “The Women and Equalities Committee report from early 2022 highlighted the increase in employers choosing to voluntarily report on their ethnicity pay gaps. The report states that in 2021, 19% of UK employers voluntarily reported on ethnicity pay – up from 11% in 2018. Whilst this sounds promising and is a large increase, many believe that mandatory reporting obligations are needed – much in the same way as gender pay reporting obligations – for other businesses to follow suit and really drive and achieve change across UK business. 

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A mere 1% of employers report reducing pay gaps

According to results from Mercer’s new UK Gender and Ethnicity Pay Gap trends report75% of respondents disagreed with government’s decision to suspend gender pay gap reporting in 2020. Despite 74% of respondents reporting that their numbers have shown continued commitment for inclusion despite the suspension, there appears to be minimal progress made in closing the gap with half of respondents claiming to see little or no progress made year-on-year. A mere 1% of employers reported reducing their pay gap by more than 10%. The results of the report offer a clear indication of how businesses continue to struggle in closing pay gaps – a trend which is expected to continue. Considering the pandemic has brought DE&I into sharp focus, businesses should allocate more attention to pay gaps in a bid to attract and retain talent in a very challenging market.

Findings in the report revealed that fewer than one in three (30%) employers reduced its gender pay gap by 2% between 2019 and 2020. Granted, focus in 2020 was finding new innovative ways to work with the arrival of the pandemic, but alarmingly, a mere 18% of employers reported an increase in pay gap from 2019 to 2020. Recently reported government figures on the UK gender pay gap numbers suggest a median gap of 10.4% for 2020, compared to 9.7% from 2019. A similar theme to Mercer’s 2021 Gender and Ethnicity Pay Gap Trends survey; and highlighting that focus on pay gaps has dwindled over the last two years.

Michelle Sequeira, Diversity, Equity and Inclusion Consulting Leader, Mercer UK commented: “Key drivers of pay gaps range from issues with attracting and retaining women to failing to eliminate the barriers to career progression that prevent female and diverse employees from entering more senior roles. There are employers who have also shown a willingness to change and they are encouraged to conduct deeper analysis to get to the root of the problem and put action plans in place.”

Following many global events surrounding race, it’s believed that employers are now looking beyond gender. Nearly 65% supported legislation enabling ethnicity pay gaps to be addressed and reported with 45% of respondents claiming they felt under pressure to conduct ethnicity pay gap analysis. Even though ethnicity pay gap reporting is not yet a legal requirement in the UK, according to Mercer’s report, 74% of employers have collected data or are planning to do so in future. More than half (57%) are conducting dry-run analysis to calculate ethnicity pay gaps, with 31% reporting that they have published or are planning to publish their pay gaps. Internal stakeholders and employees are adding pressure to organisations to make changes within the organisations and wider society.

Ms Sequeira made final comment: “To truly make a difference, employers must look beyond their pay gaps. In addition to examining ethnicity pay gaps, our report encourages employers to widen the pools from which they recruit and take steps to reduce unconscious bias in processes. Most important of all is creating a genuinely inclusive workforce that allows people to be themselves and thrive both in and outside of work. It is ineffective to offer working parents career development opportunities and salaries if they are expected to extend their working days in ways that negatively impact their family lives. It is futile to hire and train up diverse colleagues if they join a non-inclusive culture or are repeatedly overlooked for promotion. Understanding your current state and engaging and upskilling senior leaders is so key to help them realise where they are going wrong.”

 

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Pandemic has exacerbated gender inequality

A detailed report, produced by Sharon Peake, founder and CEO at Shape Talent, has exposed why women in the workplace across Britain and Europe have been so severely impacted by COVID-19.

Sharon Peake, founder and CEO at Shape Talent, said: “The fact is: pre-existing gender inequalities have been exacerbated by the COVID-19 pandemic and many of the hard-earned gains in women’s equality in the workplace, particularly at leadership levels, have been eroded. Women, the world over, are exhausted by the impact of gender bias.”

Predictions by The World Economic Forum expect that the gender pay gap is not going to close for another 136 years, as a direct impact of the pandemic. This is an increase of 36 years on the previous Global Gender Gap Report, which predicted 99.5 years.

Peake explained: “Since time began, gender equality has been viewed as a women’s issue and the focus has been on how to ‘fix’ women. This report does not exist to tell us how unacceptable this is – it is here to provide business leaders with the insight that can focus their strategies on sustainable change and ultimately accelerate gender equality.”

The paper outlines the three barriers that are summarised below:

  • Societal barriers: Subtle and often unspoken cultural cues and messages that reinforce the ways that men and women ‘ought’ to think, behave and feel
  • Organisational barriers: The hurdles experienced in the workplace and a combination of systemic obstacles, cultures and norms which disadvantage women
  • Personal barriers: A diverse range of hindrances, including how women present in the workplace and how they manage the work-family interface.

The paper lists eight guiding principles companies can adopt to counteract the barriers; these are:

  1. Link inclusion and diversity to business strategy
  2. Set the tone from the top
  3. Make inclusion part of cultural change programme
  4. Take an evidence-based approach
  5. Engage men
  6. Build and accelerate the pipeline
  7. Enable a level playing field
  8. Narrow the focus
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Only 42% of tech companies offer training and development

Female employees have gained ground in the workplace, however large skill gaps still exist when it comes to opportunities for professional development and career advancement. This, according to findings released by Skillsoft in its 2021 Women in Tech Report.

The report revealed a misalignment between the workplace benefits women in tech are seeking and what is currently being provided. For example, while 86% of respondents cited that opportunities for professional development and training as extremely or very important to them, a mere 42% said their employers currently offer this as a benefit. Additionally, when asked about the top challenges they have faced while pursuing a tech-related career, nearly a third of women surveyed (32%) pointed to a lack of training.

Potoula Chresomales, SVP, Product Management at Skillsoft commented: “Organisations around the globe are looking for ways to address their skills gaps, and in many cases, the answer lies within via their existing workforce. Women make up less than 40% of the global workforce, and for that number to increase, female employees must be empowered with continuous training, professional development, and career advancement, as well as equal pay. The time is now for organisations to tackle gender disparity head-on. By doing so, we can build more inclusive, equitable, and competitive businesses.”

Skillsoft’s 2021 Women in Tech Report highlights a few ways organisations can better empower female employees. Here they are:

Provide and encourage opportunities for certification

  • When asked how certifications have helped advance their careers, respondents reported gaining more responsibility (52%), earning higher salaries (34%), and receiving promotions (32%), among other benefits.
  • Despite business analysis and cybersecurity being identified as leading areas of interest, just 22 percent and 18 percent of respondents, respectively, hold corresponding certifications. 19 percent report holding no certifications at all.

Make an effort to reduce gender bias in STEM

  • 70 percent of women surveyed reported that men outnumber them in the workplace at ratios of two-to-one or greater.
  • The highest percentage of men in leadership roles have 15 to 20 years of experience versus 26 or more years for women.
  • To encourage more women to pursue tech-related careers, respondents said organisations should provide opportunities for professional development and training (55%), childcare (47%), career coaching, mentoring, and counselling (43%), and an equitable work culture (41%).

Alleviate the unique on-the-job challenges women face

  • More than a third of respondents list their biggest challenge as a lack of equity in pay. This is followed by balancing work and life (36%) and a lack of equity in opportunities (33%).

Ensure training is timely and topical

  • When selecting a training provider, women in tech seek scheduling capabilities (34%), relevant course availability (32%), and opportunities for hands-on practice (32%).
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Lack of transparency around salaries hinders women

A recent survey from Glassdoor, the jobs and insights agency, has found that women across the UK are at a disadvantage because of a lack of transparency around salaries. A mere 25% of full-time employees in the UK strongly agree that their employer is transparent about pay with 54% of workers admitting they aren’t comfortable discussing their salary with their boss.

The survey suggests that the lack of discussion around pay is contributing to inequality for women. Sixty-seven percent of female workers didn’t ask for a salary increase in 2020, which equates to 30% more than men. In the last year, 35% of those working in the female-dominated industries of education, healthcare, and hospitality asked for a wage increase compared to 62% of those working in the traditionally male-dominated world of finance and 56% in tech.

According to the results of the survey, women are also 26% less likely than their male counterparts to ask for more money in the next 12 months, with 37% of women planning to ask for a pay rise next year.

The survey revealed that over half (56%) of women admit they lack the confidence to ask for a pay rise and as a result, only 33% of female workers negotiated the salary of their last job offer (compared to 45% of men). Two in five (43%) women revealed that they simply accepted the salary that was offered to them (compared to 35 percent of men).

Nearly three in four of all employees (73 percent) got the wage increase they asked for last year, indicating that women will continue to miss vital opportunities to increase their earning potential.

Jill Cotton, Career Expert at Glassdoor commented: “Workplace transparency is a hallmark of many successful companies and more transparency is needed in the future. One in two women admit to lacking confidence at work – companies should open an honest discussion around salary from the point that the role is advertised and throughout the person’s time with the organisation. Having clear salary bands limits the need for negotiation which, as the Glassdoor research shows, has a detrimental effect on female employees’ ability to earn throughout their career.

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