The UK is not moving as fast as other countries to improve female economic empowerment in the workplace, according to a new study from PwC.
Despite this relatively sluggish national progress, Northern Ireland is the most improved and best performing UK region, closing its gender pay gap from 22% in 2000 to 6% in 2017. That’s equivalent to an annual average wage increase for NI working women of £1,902.
The latest PwC Women in Work Index says that, between 2015 and 2016, the UK fell from 14th to 15th place in a ranking of 33 OECD countries based on five key indicators of female economic empowerment (see notes). Although labour market conditions for women improved, the UK was outpaced by better performance from OECD countries such as Poland, which made significant gains in reducing female unemployment.
Since 2000, the UK’s position has improved from 17th place and it compares well to other G7 economies, now second only to Canada. The Nordic countries continue to lead the Index - with Iceland, Sweden and Norway rated as the top three countries for opportunities for women in the workplace.
Advances in closing the gender pay gap varies across UK regions. Northern Ireland has led the way in closing its gender pay gap since 2000, reducing it from 22% to 6% in 2017, the lowest in the UK. This has been driven by a significant number of women working in public administration, a sector with relatively high pay and a relatively low pay gap.
In contrast, London has made the slowest progress, only managing a 3% reduction in its pay gap from 22% in 2000 to 19% in 2017. The capital’s pay gap is largely accounted for by a significant divergence in the lowest-paid sectors in the city.
The research found that financial services, and agriculture and forestry sectors have seen the biggest improvements in their gender pay gap over the past year, although financial services still has the highest overall gap. The pay gap has also increased in accommodation and food services, administrative and support services, mining and education sectors.
Yong Jing Teow, economist at PwC, said:
PwC says that, closing the gender pay gap in the UK could boost women’s wages by £90bn per annum, increasing women’s incomes on average by £6,300 per woman per year.
To identify long-term solutions to end pay disparity, PwC economists identified the underlying common key drivers of the gender pay gap across all OECD countries. The results show larger government spending on family benefits significantly pushes down the gender pay gap, which suggests that greater availability of affordable childcare could improve female participation in the workforce by helping parents, especially mothers, return to work.
Countries with a larger share of female employers also tend to have smaller pay gaps, suggesting that more female entrepreneurs and women in decision-making positions could potentially increase the promotion and introduction of gender equality policies.
The research shows that a one percentage point increase in the proportion of female business owners, with more than one employee, is associated with a .53 percentage point decline in the gender pay gap.
Laura Hinton, executive board member and head of people at PwC, said:
Notes to editors.