Why are women managers paid 27% less than men?

The gender pay gap is exacerbated by bonuses, according to research released today.

by Jack Torrance
Last Updated: 25 Sep 2017

We’re all familiar with the gender pay gap – that men are on average paid around 10% more than women in the UK. But did you know the gulf grows especially wide as workers advance up the ranks of a company?

New research published by the Chartered Management Institute and XpertHR today shows that male managers typically out-earn their female peers by £11,606 per year – a 26.8% gap.

That’s partly explained by the fact that women are more likely to fill junior management roles than men (66% versus 34%). At director level the gap narrows to around 19.4%, but that still leaves women directors £34,144 worse off than their male counterparts.

‘Too many businesses are like ‘glass pyramids’ with women holding the majority of lower-paid junior roles and far fewer reaching the top,’ said CMI president Ann Francke. ‘We now see those extra perks of senior management roles are creating a gender pay gap wider than previously understood.'

The gap is exacerbated by the awarding of bumper bonuses disproportionately to men, especially at the most senior levels. Male CEOs take home a typical bonus of £89,230, compared with just £14,945 for women bosses, a whopping 83% gap. The gulf at the top is getting wider too – male directors picked up a 5.7% increase in pay and bonuses this year, compared with 3.7% for women.

‘We have always known that the gender pay gap appears to widen with seniority,’ said XpertHR content director Mark Crail. ‘But the results we are publishing today enable us to quantify the gap using a large volume of reliable, checked and verified pay data, drawn directly from employer payroll systems.’

New laws came into effect in April forcing companies with more than 250 employees to publish the size of their own gender pay gap, but according to this research, so far just 77 of the 7,850 firms that applies to have complied.

‘Our data show we need the government’s gender pay gap reporting regulations more than ever before,’ said Francke. ‘Yet, less than one per cent of companies have reported so far. Time for more companies to step up and put plans in place to fix this issue.’

Parts of this article may be removed for mobile viewing. Read it in full on Management Today