Gender pay gap falls to 12.5%

The gender pay gap at UK organisations has shrunk for the third consecutive year, early analysis has shown, but the true picture will only emerge once all eligible employers have published their data in the autumn.

PwC’s analysis of available gender pay gap data for the 2020-21 reporting year showed that the mean pay gap has fallen to 12.5% from 14.3% in the first year of reporting in 2017-18.

However, most organisations required to disclose their gender pay data are yet to publish their reports on the government’s portal. Three-quarters of eligible organisations – those with 250 or more employees – are taking advantage of the extended deadline being offered by the Government Equalities Office in light of the pandemic, and have until 5 October 2021 to publish their data for the 2020-21 reporting round.

Of those that published their reports by the usual deadline (31 March for public sector organisations, 4 April for private sector firms), 58% recorded a drop in their mean gender pay gap.

Larger companies were significantly more likely to report ahead of the usual deadline, with 60% of organisations with 20,000 or more employees doing so. Building societies, utility companies, banking firms, investment companies and real estate organisations were among those most likely to voluntarily report their data.

Katy Bennett, inclusion and diversity director at PwC, said that the next 12 months would likely see greater external pressure on companies to promote inclusion and diversity, particularly as numerous studies had shown women had been disproportionately impacted by the pandemic.

She said: “It’s been a complex reporting year for many companies and the decision to defer reporting will not have been taken lightly. The six-month delay in enforcement by the Government Equalities Office has been welcomed by many employers, who are understandably addressing the ongoing impact of the pandemic and its effect on their April 2020 gender pay gap results.

“However, organisations must continue to report and the optics of this reporting cycle will be especially important given the disproportionate impact on women of the pandemic.

“In reality, with so many companies still to disclose their gender pay gap, it will only be after October that we get a true picture of this year’s reporting. This data will also likely give us a much richer picture of the impact that the pandemic has had on women compared to men.”

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

Email(Required)

OptOut

From time to time, we will send you emails about selected products, events and services from Personnel Today and OHW+ - but you can choose to opt-out at any time. If you do not wish to receive these emails, please tick this box.

Phone

This field is for validation purposes and should be left unchanged.

Δ

Bennett said that in the autumn we were likely to see noticeable differences in the pay gaps in companies and industries where significant numbers of individuals were furloughed or no longer in employment.

Other findings from PwC’s analysis of the fourth year of gender pay gap reporting include:

• Only 25% of eligible organisations chose to publish their reports by the usual 5 April deadline
• As at 6 April 2021, 2,445 organisations had disclosed their pay gap compared to 10,409 in 2019 and 4,808 in 2020, when enforcement of the regulations was paused
• Some 18 of 24 sectors analysed by PwC recorded a decrease in their gender pay gap in each of the past three years.