Read: As we celebrate International Women's Day, there's still work to do on equal pay
As we celebrate International Women’s Day, and all that’s undoubtedly been achieved so far, it is still truly shocking to hear that a young woman starting work today at 18 years old will not see pay equality in her working lifetime, if progress towards gender equality at work continues at its historical rate.
In 2017, as Minister for Women and Equalities, I introduced the gender pay gap regulations that provide crucial transparency on progress for women’s pay in the workplace. However, new research published this week shows that a widening gender pay gap, set against the backdrop of a cost of living crisis, is threatening to undermine economic recovery, not just of women but of society more widely. PwC’s annual Women in Work Index 2023[1] showed that, on average, men earned 14.4% more than women in Britain in 2021, compared to a pay gap of 12% the previous year. That increase is four times that seen across other developed nations in the same year.
According to the report, the situation is being driven by ‘the motherhood penalty’ - the loss of lifetime earnings experienced by women who raise children. When they return to work after having children, with an unfair division of childcare at home, they face underemployment and slower career progression at work. It’s being made worse by a lack of affordable childcare but also a low take up by fathers of shared parental leave and it’s threatening to price a growing number of women out of work completely.
It’s a complex situation but one which the Government and employers can’t afford to ignore. In the week before the Budget, childcare is the associated issue which the Chancellor will come under the greatest pressure to address, particularly the gap in free childcare provision between the ages of one and three. But there are many other areas where bold and innovative solutions could be introduced that will encourage women into the workforce.
Many organisations are already offering flexible working options that lean in to accommodate family and other caring responsibilities as well as a positive approach to health and wellbeing, including the menopause, which help women to feel supported in the workplace, and to thrive as a result. But there should also be a focus downstream on equipping girls at school with the information and advice they need to consider STEM subjects as their academic career progresses and then on attracting them into rewarding and well-paid careers, particularly in science and technology. Employers need to assess their recruitment practices and career progression to ensure that women can get in, and get on, and work to remove the barriers that still exist to achieving that.
That should include the ability to reach the very top of an organisation. It’s clear that progress is being made. New figures show that the proportion of women in board roles in Britain’s biggest listed companies rose by three per cent in 2022 and is now above 40% for the first time, with only ten of the UK’s 350 largest companies still having all-male executive teams.[2] Every one of their boards now has at least one woman on it, compared with 152 male-only boards just over a decade ago, making the UK second only to France in the world. Less welcome is the fact that UK companies are failing to appoint women to leadership positions below board level at the same rate, with only 33.5% of executive committees being women.
Many of the organisations who are part of the Purpose Coalition – a group of businesses, universities, NHS Trusts and local authorities focused on delivering equality of opportunity for their colleagues, customers and communities – are led by women. One of our members, the water company Severn Trent, is the first FTSE 100 company with an all-women board. But it includes many other female leaders who are not only inspirational role models but who are designing and developing solutions that address some of the underlying causes of the challenges we’re experiencing today. They recognise that it makes sound economic and social sense to use all the talent pool that is available and to build inclusive and diverse workforces that reflect the communities they serve.
The theme of this year’s International Women’s Day is Embrace Equity. It urges us to recognise that people have different backgrounds and experiences. Their circumstances are different and some groups will experience significantly more barriers than others. The best leaders, and those shaping the future most effectively, will acknowledge and embrace those differences and put in place tailored strategies that will accommodate different pathways but with a focus on the same end result - opportunity that is accessible to everyone.
