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Train station platform with words 'Mind the Gap' printed in white.

Equal Pay Day 2021 – Why has the gender pay gap increased?

Today is Equal Pay Day. This marks the day in the year when women effectively stop earning and work for free until the end of the year.

The date of Equal Pay Day changes each year, and is worked out using the gender pay gap. This is the percentage difference between average hourly earnings for men and women. It sees women earning less, on average, than their male colleagues. 

How big is the gap currently?

The ‘Gender pay gap in the UK: 2021’ report from Office for National Statistics shows among full-time employees, the gender pay gap in April 2021 was 7.9%, up slightly from 7% in 2020.

Over recent years the gap has continued on a downward trend, from 17.4% back in 1997, according to the Office for National Statistics Survey of Hours and Earnings. Having grown slightly since last year, many feel the Covid-19 pandemic may be to blame for this.

How might the pandemic have affected the gender pay gap?

The Covid-19 pandemic has undoubtedly been tough for women in terms of economic hardship. Women are much more likely than men to be in low-paid jobs and sectors, hit hard by lockdowns and the slow economic recovery. 

According to Office for National Statistics data, women have been carrying out, on average, two-thirds more childcare/home schooling duties per day than men. This has seen them more likely to work fewer hours, take time away from work, or drop out of work completely since the start of the pandemic in March 2020. Government statistics on the Coronavirus Job Retention Scheme show roughly 133,000 more women were furloughed than men across the UK between March and August 2020.

The transport industry experienced similar figures. The ‘Gender Perceptions and Experiences Working in Transport’ survey carried out earlier this year by Women in Transport and the All-Party Parliamentary Group for Women in Transport, highlighted exactly this.

Responses from the survey such as ‘the majority of people put on furlough at my firm were women’ and ‘juggling work and home school made life harder’ back up just how difficult the pandemic has been for women in particular within the transport industry.

Gender pay gap reporting

From 2017, employers with a head count of 250 or more must comply with regulations to report and publish their gender pay gap information each year. 

The Equality and Human Rights Commission suspended mandatory pay gap reporting last year due to the continuing impact of the pandemic, and the deadline for publishing of 2021 data was extended from March/April until 5thOctober 2021.

During this time many industry experts called for the lifting of the suspension amid fears the gender pay gap would be taken for granted and slow progress.

According to figures revealed by the government’s gender pay gap reporting service at the start of October, around one in four required employers, hadn’t yet reported their gender pay gap. On the morning of 5th October, only 8,500 of an estimated 11,000 had submitted their report to government and published it on their own website.

Is Covid-19 to blame?

So while it appears the pandemic has had an effect on the figures and reporting of the gender pay gap, it’s not entirely clear yet whether it’s actually to blame for the increase this year.

The Office for National Statistics has stated in its ‘Gender Pay Gap in the UK:2021’ report that interpreting average earnings data has been difficult in the current climate. It has warned caution should be taken when making comparisons with 2020 figures, and the focus should be on the longer term trends rather than year on year changes.

According to Felicia Willow, Interim CEO of the Fawcett Society (the UK’s leading membership charity campaigning for gender equality and women’s rights at work, home and in public life), we needed to wait until furlough, data collection, and other issues had all ended before we can be certain of what’s happened.

Moving ahead

In the meantime, the focus needs to remain on consistency in gender pay gap reporting. Accurate information on the gender pay gap will ensure we can easily identify disparities in particular areas and sectors to make changes that will help reduce the gap overall.

In a recent statement, Jo Field, President of Women in Transport confirmed the average pay gap is a perfect illustration of the lack of diversity among senior positions in most companies. Data submitted by key transport employers (Department for Transport, Transport for London and Network Rail) last year shows this is a particular issue for the sector. The Gender Perceptions and Experiences Working in Transport survey found 75% of women believed it was easier for men to progress in their career compared to women.

Gender pay gap reporting has undoubtedly been effective in getting big employers to act, but it’s clear we need to go further. The Fawcett Society recently called upon government to take the following action:

  • Requirement of mandatory action plans for employers to tackle gender pay gap in the workforce as well as sharing data.
  • Improvements in childcare provision.
  • Making flexible working available to everyone.
  • Tackling the rising cost of living.

While there has been definite progress made to reduce the gender pay gap in recent years, and we shouldn’t be too disheartened by the slight increase this year, there is definitely still a long way to go until we no longer have the need for an Equal Pay Day.