Closing the Gender Pay Gap and Advancing Women in Leadership: How the UK Can Accelerate Change

The UK’s gender pay gap persists, and women remain under-represented in leadership. While progress has been made, career barriers and pay disparities continue. What’s holding them back, and how can we accelerate change? This article explores key challenges and solutions for workplace equality.

The United Kingdom has made significant strides toward gender equality, but it still continues to grapple with a persistent pay gap and under-representation of women in leadership roles.

Women continue to be paid less than men for comparative work and still face barriers when it comes to progressing up the career ladder. However, there is room for optimism.

Over the past decade, the gender pay gap among full-time employees has decreased by approximately a quarter. Progress is being made, but there is clearly still a long way to go.

The Current State of the Gender Pay Gap in the UK

The gender pay gap in the UK has been reducing gradually over the past decade.

In April 2024, the gap among full-time employees stood at 7.0%, down from 7.5% the previous year. However, when considering all employees—both full-time and part-time—the gap widens to 13.1%. This disparity is partly attributed to the higher proportion of women in part-time roles, which typically offer lower hourly wages.

Age also plays a significant role in the pay disparity. For full-time employees under 40, the gap is relatively small. However, it expands notably for those aged 40 and over, with women earning significantly less than their male counterparts. This trend suggests that career interruptions, often related to childcare and family responsibilities, adversely impact women's long-term earnings.

Women in Leadership: Representation and Challenges

Women’s representation in leadership positions within the UK’s top companies has seen modest improvements. As of February 2024, women held over one-third of all leadership roles in FTSE 350 companies.

Despite this progress, the proportion of women in executive roles has experienced setbacks. In 2024, the percentage of women on executive committees at the UK's 350 largest listed companies dropped to 32%, down from 33% in 2023.

The underrepresentation is more pronounced in top executive roles. Women occupy only 9% of CEO positions and 18% of CFO roles. Additionally, female board members in FTSE 100 companies earn, on average, 69% less than their male counterparts, highlighting a significant pay disparity even at the highest corporate levels.

Barriers to Gender Equality in Pay and Leadership

Several factors contribute to the persistent gender pay gap and the underrepresentation of women in leadership:

Occupational Segregation: Women are disproportionately represented in lower-paying sectors and roles, while men dominate higher-paying industries and positions.
Career Interruptions: Women are more likely to take career breaks for childcare and other family responsibilities, leading to lost income and slower career progression.
Part-Time Work: A higher percentage of women work part-time, often due to caregiving responsibilities. Part-time roles typically offer lower hourly wages and fewer advancement opportunities.
Organisational Culture: Workplace cultures that lack flexibility or fail to support work-life balance can disadvantage women, particularly those with caregiving duties.
Bias and Discrimination: Conscious and unconscious biases in hiring, promotion, and pay decisions can perpetuate gender disparities.

International Comparisons

The UK's gender pay gap is narrower than that of some countries but lags behind others. According to the Organisation for Economic Co-operation and Development (OECD), the UK's gender wage gap is below the OECD average.

However, countries like Belgium and Italy report smaller gaps, suggesting that more proactive policies and cultural shifts can lead to better outcomes.

In terms of women in leadership, the UK fares better than some nations but still falls short of parity. The proportion of women on boards in the UK is higher than in countries like the United States, where women hold 29% of leadership roles in the S&P 100. However, the UK still has a considerable journey toward achieving equal representation.

Strategies to Accelerate Change

1. Policy Interventions:

Enhanced Parental Leave: Implementing policies that encourage shared parental leave can help distribute caregiving responsibilities more equally, reducing career interruptions for women.
Affordable Childcare: Investing in accessible and affordable childcare services can enable more women to participate fully in the workforce.

2. Organisational Practices:

Transparent Pay Structures: Companies should conduct regular pay audits and be transparent about compensation to identify and address disparities.
Flexible Working Arrangements: Offering flexible working options can help employees balance work and personal responsibilities, benefiting both women and men.
Mentorship and Sponsorship Programs: Establishing programs that support women's career development can prepare them for leadership roles.

3. Cultural Shifts:

Challenging Stereotypes: Society must continue to challenge and change stereotypes about gender roles, particularly concerning leadership and caregiving.
Encouraging Male Allyship: Men in leadership positions can advocate for gender equality by mentoring women and promoting inclusive workplace cultures.

While progress has been made in narrowing the gender pay gap and increasing women's representation in leadership within the UK, significant challenges remain.

By implementing comprehensive policies, fostering inclusive workplace practices, and promoting cultural change, the UK can accelerate its journey toward true gender equality. This not only benefits women but also contributes to a stronger, more inclusive economy and society.

As we celebrate International Women’s Day this month, we have shared other articles that highlight the challenges and progress in achieving gender equality: