Tag: pay gap

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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More disabled people than non-disabled people research pay gaps before applying for jobs
According to the ONS’s disability pay gap report, the pay gap has widened since the 2014’s number of 11.7%. In 2019, the pay gap was 14.1% and shrunk slightly in 2021 to 13.8%.

UK careers site, Reed.co.uk’s research has also found that 66% of disabled people research gender pay gaps, whereas only 21% non-disabled people did the research. This is an indicator of how important pay parity is for minority groups. The study also revealed that one-in-ten surveyed respondents don’t think that any pay gaps exist in the UK.

Simon Wingate, Managing Director of Reed.co.uk, commented: “It is disappointing to see that the disability pay gap has widened since 2014. This widening discrepancy between disabled and non-disabled workers is especially concerning given that the rising cost-of-living crisis is putting pressure on people across all of society.”

“It’s also concerning for employers facing challenges of their own in terms of recruitment amid widespread labour shortages. Tackling the disability pay gap will be crucial to widening the talent pool, as our own research highlights how important pay parity is to minority groups. Two-thirds (66%) of disabled people state they research a company’s gender pay gap before applying for a job, compared to 21% of people without a disability. This sentiment, in conjunction with the newly released ONS report, demonstrates the attention and work that still needs to be implemented to ensure employers close their disability pay gap.”

“As a Disability Confident employer, Reed.co.uk recognises how important it is to support employees who disclose that they have a disability and will always seek to make reasonable adjustments for prospective candidates. Every individual’s needs will inevitably vary, and it’s important that employers understand this and make appropriate adjustments to support suitable candidates who have applied for a job with them. A fundamental way to attract prospective disabled workers is by being clear in job adverts that the organisation is an inclusive employer who values diversity and is willing to make reasonable adjustments to support candidates through the recruitment process and beyond. It is also helpful to be fully transparent about pay, flexibility, and benefits on job adverts as this will help employers attract a more diverse range of applicants to their role, and ultimately their business.”

As previously reported in TALiNT International, flexible working could create jobs for more than a million disabled candidates. Employers should be creating equal opportunities for every candidate in the workplace and not only promote equal pay, but also offer flexibility as a matter of course.

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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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Ethnicity pay gap reporting is not mandatory  

Research by People Like Us and Censuswide has revealed that workers from Black, Asian, mixed-race and minority ethnic backgrounds only earn 84% of what their white counterparts are paid. This is 16% less and equates to losing up to £255,000 pounds every year. 

The findings also revealed that people from racially diverse backgrounds are passed over for pay rises – and this happens more frequently the more senior they become with a third passed over at entry level. This figure is more than half at senior manager and director level.  

According to the research 59% of racially diverse respondents believe this ‘progressional glass ceiling’ is down to the colour of their skin. With the pandemic shining a spotlight on diversity and inclusion in the workplace, it’s important that HR teams need to review their pay structures.   

Darren Hockley, Managing Director at DeltaNet International commented:  

“The sheer fact that ethnic minority workers are paid 16% less than their white colleagues shows the reality that ethnicity pay gaps continue to exist in organisations. HR teams and business leaders in the UK have a long way to go. While it’s still not mandatory for ethnicity pay gap reporting, some organisations such as PwC are already publishing them to be transparent. The findings clearly show that HR teams must start doing ethnicity pay gap reporting as it will give them the push they need to review their pay structures and question themselves if they are doing enough to address the pay gap. Reporting is the best way to start improving racial equality in the workplace.   

“Organisations must understand the benefits of diversity and inclusion, and this means everyone, regardless of ethnicity, are getting paid their worth. For organisations to retain their best talent and ensure their business continues to prosper, it’s high time business leaders focus on addressing all pay gap issues, including gender and ethnicity. Business leaders ought to undertake unconscious bias and diversity and inclusion training to ensure everyone within their business are not under-represented and paid below their worth.” 

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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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Gender pay gap in the UK is 16.01%

New research from William Russell revealed the countries around the world that are the most empowering countries for women to live and work – and the UK didn’t make the list.

To score countries and rank them, the team at William Russell looked at a number of factors to create the Female Empowerment Score including:

  • Gender Pay Gap
  • The proportion of women who achieve tertiary education
  • The length of paid maternity leave
  • Female representation in government

The 10 best countries for female empowerment: 

Rank Country Female Empowerment Score 
1 Iceland 7.64
2 Finland 7.62
3 Ireland 7.22
4 Belgium 7.12
5 Denmark 7.04
6 Canada 6.83
7 France 6.77
8 Norway 6.73
9 Sweden 6.67
10 Lithuania 6.64

 

  • Iceland topped the list as the most female-friendly place to live and work, with a female empowerment score of 7.64. This Nordic island nation is well known for its progressive views and welcoming culture with more than half of adult women having achieved tertiary education such as a university degree.
  • Finland took second place with a score of 7.62. Finland has achieved excellent representation for women in its government, with 50% of all ministerial positions occupied by women.
  • Ireland takes third place, with a female empowerment score of 7.22. Ireland has a relatively low gender wage gap of 7.99% and a very competitive 182 days of paid maternity leave for new mothers.

The research also revealed the following:

  • The average gender wage gap around the world is 28%, the UK is above that with 16.01%.
  • The length of paid maternity leave is different all around the world, the average is 6 days. The UK is less than half of that with 42 days, Slovakia gives the most with 238 days.
  • The % of women who achieved tertiary education in the UK (47.7%), is higher than the global average (40.7%). Israel is at the top with 88%.
  • The global average for the proportion of women in ministerial positions is 34.44%. The UK is beneath that with 23.81%, whereas Belgium comes out on top with 57.14%.

Photo courtesy of Canva.com

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Female board members earn almost half of male counterparts

Research published by New Street Consulting Group revealed that female board members at some of the UK’s largest companies are paid around 40% less than men in the same roles.

While equal pay has been in sharp focus over the last few years, data revealed that the gender pay gap is the widest in the c-suite of corporate Britain. On average, women earned £104,800 for non-executive roles at FTSE 100 companies last year, compared with an average of £170,400 paid to men. For executive board members, average pay was £2.5m for men and £1.5m for women.

In the broader market, women were paid 15.5% less than men, according to 2020 data from the Office for National Statistics.

Darren Hockley, Managing Director at DeltaNet International commented: Despite discussions of the gender pay gap over recent years, and the introduction of gender pay gap reporting, it’s clear that FTSE 100 organisations are still not doing enough to tackle the issue – especially when there’s a 40% difference.  The fact is that unconscious bias remains, and organisations must tackle diversity and equality issues by supporting staff with training. HR must work more closely with executive teams to address equal and fair pay to stamp out social injustice.

“Pay equality responsibility does not just lie with HR; it requires support from everyone in the organisation in order to be addressed. So, more executives need to step up and become an ally for their female colleagues. If they are aware of injustice, then they need to speak up and support their female colleagues to get paid what they deserve.”

40% club

The Financial Conduct Authority recently suggested that UK companies should ensure that at least 40% of board level roles and a minimum of one senior executive role are held by women.

New Street Consulting Director Claire Carter, said “Focusing solely on the percentages of directors that are women is not enough when trying to approach equality.”

The government-backed review of board diversity, the Hampton-Alexander review found that, across the FTSE 350, women now held its 2020 target of an average of 33% board roles. But 130 businesses fell short of this target. Senior board roles remained male dominated, with just 14% of executive directorships held by women. Just 17 chief executives across the FTSE 350 are women.

Most businesses are doing their best to ensure they’re no longer a ‘boys club’ even if the reality of their demographics didn’t live up to aspirations, said Carter.

“The key to doing that will be ensuring that women have more executive responsibilities and are trained and prepared properly for taking on that responsibility,” she said. “It will be a case of their examining whether there are any barriers that are preventing females from reaching the very top at their organisation.”

Photo courtesy of Canva.com

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