Women executives could wait 98 years for equal pay, says report
Women managers already more than £10k behind men doing the same job and may not get parity till 2109, according to CMI
Women may have had equal voting rights since 1928, but they may have to wait another 98 years for parity in pay, research has found.
While the salaries of female executives are increasing faster than those of their male counterparts, it will take until 2109 to close the gap if pay grows at current rates, the Chartered Management Institute reveals.
The research shows that male executives continue to be paid more than women for the same roles, earning an average of £42,441 compared with £31,895. The £10,546 gender pay gap is an increase on the £10,031 from the same study last year, despite women’s salaries having grown by 2.4% and men’s 2.1% in the 12 months to February 2011.
Mike Petrook, head of public affairs at the CMI, said: “Our reaction to it taking almost 100 years to get any form of parity is incredible alarm. It is a position we shouldn’t be finding ourselves in. It brings with it issues of discrimination and loss of skills, as women are more prepared to walk [from jobs] than men if they are not getting what they want.” The data shows that 4.2% of women resigned during the period, compared with 3.6% of men.
The figures, compiled from a poll of 34,158 UK executives, were unveiled after a year in which the issues of female recruitment and remuneration have become increasingly high-profile.
In February, Lord Davies of Abersoch, who led an inquiry into male boardroom dominance, warned big British businesses to double the number of women in boardrooms to 25% within five years or face government sanctions. To hit 25% by the deadline, a third of all vacancies for FTSE 100 directors will have to be filled by women.
While Davies faced criticism for not imposing a compulsory quota, recent figures suggest that the mere threat of punishment has pushed companies into action. According to an analysis by the Observer, Britain’s biggest companies have doubled the number of women they are recruiting to their boards in the past six months.
Elsewhere, Helena Morrissey, chief executive of Newton Investment Management, and the Labour peer Lady Goudie have founded the 30% Club, a group of company chairs lobbying for increased female representation in the boardroom. Its members include Robert Swannell of Marks & Spencer, Sir Philip Hampton of Royal Bank of Scotland and Sir Roger Carr of the British Gas owner, Centrica. Petra Wilton, the CMI’s director of policy and research, added: “Diversity shouldn’t be seen as something that has to be accommodated, but something that must be celebrated. Imposing mandatory quotas and forcing organisations to reveal salaries is not the solution.
“We need the government to scrutinise organisational pay, demand more transparency from companies on pay bandings and publicly expose organisations found guilty of fuelling the gender pay gap.”
The CMI study also found that redundancy hit men and women equally hard between February 2010 and February 2011, with 2.2% of both male and female executives losing their jobs.
While that appears to be encouraging for female executives compared with last year – when 3% of men were made redundant compared with 4.5% of women – the figures also revealed high levels of inequality at the top end of companies, where almost five times as many female directors as male directors lost their jobs.
During the period, companies shedding directors released 0.6% of men and 2.9% of women.
However, despite the slow pace of change, the survey did unearth some more positive trends for women. For the first time since the CMI started collating the figures, some female executives are earning as much as their male counterparts, albeit only at a junior level. With an average salary of £21,969, female junior executives in the UK are being paid marginally more than male executives at the same level, whose average salary is £21,367.
Phillippa Williamson, chief executive of the Serious Fraud Office, said: “There is a clear business case for equal pay; evidence shows that companies where women are well represented at every organisational level from board level down perform better.”