Labour Market

Faulty gender pay gap stats mask the very real progress made by women

More good news for women: according to the Office for National Statistics (ONS), the gender pay gap in the UK is now at its lowest on record.

Coming in at 8.6 per cent for full-time workers in 2018, the average gap in hourly earnings between men and women is down from 9.1 per cent last year.

Even more good news – this time to be shared all round – is that average weekly pay is increasing at the fastest pace since the 2008 financial crash, with benefits particularly being felt by those in low-paid work.

You would think that this would be news for us all to celebrate. Trends are looking good, for women and for the wider workforce.

Not so, says the Fawcett Society, a UK-based charity that campaigns for women’s rights and runs the Equal Pay Day campaign every year, which alleges a calendar date on which women “effectively stop earning relative to men” because of their gender.

From the Fawcett Society’s perspective, the “slow rate of progress means without significant action women starting work today and in decades to come will spend their entire working lives earning less than men”. But this perspective is not borne out by the data.

The pay gap, of course, is not a measurement of equal pay for both sexes, but rather a reflection of averages and different choices made by working men and women across a very broad spectrum.

While the ONS statistics are some of the most accurate we have, they still do not take into account critical factors, like the specific job, background, education, or previous experience of the people they measure.

The 8.6 per cent figure out yesterday therefore highlights progress in the difference in average earnings, even before you compare people with like-for-like jobs, equal qualifications, or similar CVs.

In short, even before most the meaningful data is brought into the mix, the prognosis is still moving in the direction of women earning more money.

And while women are on average still out-earning men when it comes to part-time work, that pay gap is narrowing as well, down from a negative 5.3 per cent in 2017 – that is, a pay gap in favour of women – to negative 4.4 per cent this year.

It might seem strange, then, that despite these shifts in the pay gap data, the Fawcett Society’s Equal Pay Day falls on the same day in 2018 as it did last year: 10 November. The progress made has not shifted the needle in the slightest for the campaign, which suggests that women are essentially working for free for the last month and a half of the year.

This is what happens when campaigns divert from the calculations that give us the most insight to calculations that give us larger figures. Using the mean average calculation instead, Fawcett’s figures move further away from comparing male and female salaries like-for-like, making the outlook appear worse for women than the real picture shows.

We should be celebrating good news when it comes our way, and highlighting the successes of working women along with it. Any attempt to hide the very real progress we have made flies in the face of reality.

A version of this article first appeared on City AM.

Kate is Associate Director of the IEA. Kate oversees the IEA’s Media Centre and digital platforms, creating and commissioning content for the website, social media, and ieaTV. Kate regularly features across the national media, including appearances on BBC News, Sky News, Channel 4, Channel 5, ITV and BBC’s Question Time.

1 thought on “Faulty gender pay gap stats mask the very real progress made by women”

  1. Posted 29/10/2018 at 14:00 | Permalink

    of course, if the gap arises from employment choices made by men and women freely, its closing is not necessarily good news. It could be neutral (different free choices being made as the stock of women graduates rises relative to the stock of male graduates as the cohort effect of more men going to university works its way out of the system) or actually negative (if the shape of the tax system of subsidies for child care lead women to make choices they would not make in the absence of those distortions). I am being pedantic, of course, but not a totally irrelevant point.

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