Employees from working class backgrounds earn more than £6,000 less than their more privileged peers in the same occupation.
According to figures from the Social Mobility Foundation, today (17 November) marks Class Pay Gap Day, when those from lower socio-economic backgrounds essentially ‘work for free’ for the rest of the year.
Professional workers from professional and managerial origins receive an average salary of £51,728, compared to an average salary of £45,437 for employees from working class backgrounds, the research found.
The chasm is biggest in the private sector, where those from a professional or managerial background are paid £7,575 more than working class peers. The private sector employs 82% of the UK’s workforce.
Class pay gap
The class pay gap has closed slightly compared to last year, when the SMF’s research showed working class professionals earned on average £6,718 per year less than those from a more privileged background in the same job.
This summer, the SMF polled young people between the ages of 16 and 18, revealing that 89% would be more enthusiastic about working for an employer that was committed to tackling social mobility.
A growing number of employers already publicly measure and report on socio-economic diversity, including law firms such as Allen & Overy and Freshfields, or consulting firms KPMG and PwC.
Kevin Ellis, senior Partner at PwC UK, said: “The gap in pay between professionals from a lower socioeconomic background and their more privileged peers, is not only a societal issue but an issue for business and the economy.
“Businesses need diversity of talent and thought. We’ve seen the benefits of improving the diversity of our workforce – you can’t measure this without collecting socioeconomic background data.
“Gathering data helps you understand what interventions to make because these changes don’t happen naturally. We always strive to do more – so it’s positive to see other employers now starting to collect data and making efforts to close their socioeconomic background pay gaps.”
Alan Milburn, chair of the social mobility foundation said that too many employers were guilty of this “shameful secret”.
“It cannot be right that professionals from working class backgrounds are paid significantly less than their peers in the same occupation,” he said.
“Some pioneering employers are measuring their class pay gap – as a precursor to closing it. But it will take action from government to see the step-change that’s needed.”
The former Labour cabinet minister added that social mobility reporting should be mandated in the same way as gender pay gap reporting.
“What gets measured, gets done. Without government action, millions of people will continue to be undervalued and underpaid.”