The average female executive will earn £400,000 less than her male counterparts over her career lifetime, according to the Chartered Management Institute’s (CMI) annual gender salary survey, based on data from XpertHR.
The report reveals that, despite women making up 57% of the workforce, the pay gap between men and women continues. Average salaries for female executives were £10,600 less than for male workers at the same level, according to the survey. In addition, women receive less than half what men earn in bonuses – the average bonus for a male executive was £7,496, compared with £3,726 for a female executive.
At director level, the disparity is even greater. Female directors earned an average basic salary of £127,257, £14,689 less than the male director average of £141,946.
More women also fell victim to redundancy in the 12 months to August 2012, with 4.3% of female executives placed out of work, compared to 3.2% of male executives. The number of women losing their jobs has almost doubled since the last survey in 2011. More men than women left their jobs of their own volition – 14.2% of men walked away from positions in the 12-month period, compared with 12.2% of women.
Further, a much smaller percentage of women made it into top roles, the report found. Just 40% of department heads and only one chief executive in four (24%) are female. At junior levels, the gender pay gap is less defined: the survey found that more than two-thirds (69%) of junior workers are female, and female junior executives earn marginally more on average (£363) than their male counterparts.
Regionally, the pay gap is widest in inner London, where male executives earn on average £16,440 more than female executives. It is smallest in Northern Ireland, where the male-to-female gap is £4,137.
Ann Francke, the CMI’s chief executive, said: “A lot of businesses have been focused on getting more women on boards but we’ve still got a lot to do on equal pay and equal representation in top executive roles. Women make up almost three out of four at the bottom of the ladder but only one out of four at the top.
“This lack of a strong talent pipeline has to change, and fast. Allowing these types of gender inequalities to continue is precisely the kind of bad management that we need to stamp out. Companies are missing out on the full range of management potential at a time when we need to be doing everything we can to boost economic growth.”
She added that the issue could not be tackled through legislation alone. “Employers need to take action to change corporate cultures. Development opportunities such as mentoring and qualifications have been proven to be highly successful in helping women build the confidence and skills needed to realise their potential. Employers failing to recognise this are missing a trick – create an environment where your staff can thrive, are diverse and are paid fairly, and your business will thrive too,” she said.
Other suggestions include the Government demanding more transparency from companies on pay, naming organisations where inequality is particularly marked, and celebrating those where there is gender equality in terms of promotion opportunities and salary. The CMI also welcomed plans to require companies to report on the number of women in senior positions, as well as the planned reforms to parental leave.