Maintaining focus on equality.
Gender pay gaps in UK businesses are continuing to narrow for companies that reported their 2020/21 data.
Our latest analysis shows a three-year decline among companies that disclosed their pay gaps, from an average gap of 14.3% in 2017/18 to 12.5% in 2020/21. More than three quarters of companies have delayed reporting in line with the extension granted by the Government Equalities Office.
All companies with more than 250 employees are required to report their gender pay gaps. The delay in enforcement of this year’s deadline follows a suspension in 2019/20, both due to the COVID-19 pandemic.
58% of those that did report before the usual 5 April deadline recorded a drop in their mean pay gap. Around seven out of 10 (68%) said their bonus gap had reduced or remained constant. We also found larger companies are much more likely to have already reported for the year, with more than 60% of those with 20,000 or more employees having done so before 5 April. This highlights a continued focus on gender balance, and inclusion and diversity from the largest companies though these companies are also less likely to have experienced resourcing challenges over the past year.
As expected, respective changes to the deadline for gender pay gap reporting deadline in 2019/20 and 2020/21 had a significant impact on the disclosure rate of companies compared to the prior years. As illustrated in the chart, while the number of companies reporting before mid-February had increased in each year prior, the rate of such early disclosure slowed significantly in 2020/21, with many anticipating a further delay in the deadline or unsure how the suspension applied to this reporting cycle, Following the 6 month delay in enforcement reporting slowed further and as at 6 April 2021, 2,445 companies had disclosed compared to 10,409 as at 6 April 2019.
Of those that have disclosed every year since 2017 the mean pay gap has consistently decreased at the median moving from 14.3% in 2017 to 12.5% in 2020. This trend is also present in the mean bonus gap, which has decreased from 37.6% at the median in 2017 to 33.6% in 2020. When looking at the change in the mean pay gap over time by sector, there has been a consistent decrease since 2017 for 18 of 24 sectors considered.
Diversity and Inclusion Consulting Director, PwC United Kingdom
Tel: +44 (0)7715 211210
Partner, Diversity & Inclusion Consulting, PwC United Kingdom
Tel: +44 (0)7483 329718