Women need to work until 79 to earn the same as men

A new study shows women managers are paid 23% less than their male counterparts, but are things improving?

by Adam Gale
Last Updated: 07 Mar 2016

A new study has answered the age-old question of how that bloke on the top floor could possibly have afforded his new Harley. According to new research from the Chartered Management Institute (CMI), male managers are actually being paid more than their female counterparts. We never would have guessed.

In a survey of 68,000 managers, the CMI found a £9,069 or 23% average pay gap between the sexes. This means that women managers would need to work until they were 79 to earn the same as menfolk retiring at a normal age. While that would be one way of solving the pensions crisis, it’s still a tad unfair.  

The main reason for the disparity is that women are far less likely to have reached senior positions, comprising only 30% of the directors surveyed against 69% of entry-level managers. To be fair to ‘the man’, this will in large part be due to childbirth and maternity breaks, although many companies still need to better nurture and promote their talented mothers. The pay gap jumped from 8% for 26-35 year olds (still far too wide) to 23% for 36-45 year olds, straddling an age when many (though by no means all) professional women have kids.

It’s also possible, however, that older men could be reaping the benefits of having risen through the ranks at a time when discrimination was more overt than it is today. It’s much easier to stay at the top table than to earn a place at it. Indeed, the research does show that the pay gap increases with age to 35% for over 60s.  

Depressingly though, women at director level are still receiving lower annual pay increases than men, at 1.9% compared to 2.7%. The disparity in increases at this senior level is far less likely to be explained by childbirth. Of course, there are other possible explanations, such as the distribution of men and women in different sectors of the economy, which are not dealt with in this report, but it remains likely that there is some form of discrimination at the top level.

Despite this, there are some hopeful signs that the kids are down with equality, man. The CMI found the pay gap to be only 6% for 20-25 year olds, while a recent ONS report found that women aged 22-29 actually out-earn men, marginally. With any luck, it will be Harleys for everyone before long –and about time too.

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