Age and the gender pay gap

The Annual Survey of Hours and Earnings (ASHE) released the first cut of its 2013 data yesterday. Time, then, for another update on the age-related gender pay gap, which regulars will know I’ve been keeping an eye on for a while.

As most of the papers report, the gender pay gap has gone up. Even among full-time workers it has increased slightly, though it is still lower than it was at the start of the recession.

The gap that had been opening up between the pay of men and women in their twenties, with women earning more, has closed again. The gender pay gap has increased among all other age groups except those in the 18-21 range where it has fallen from 5.7 to 1.4 percent. Some people predicted that the recession would hit women harder than men. The slight reversal of the full-time gender pay gap trends may be a reflection of that. Given that women are disproportionately concentrated in the public sector, the pay freezes and job losses over the last few years will have had an effect on the overall level of women’s pay.

As ever, though, the big leap in the gender pay gap comes between the 30s and 40s, as the effects of career and child-care choices reduce women’s earning power. (See previous post for a more detailed discussion of this.)

Gender pay difference for median hourly earnings, excluding overtime       Percentage full-time pay difference (men/women) by age band
Slide1

The fall in the gender pay gap among people in their thirties seems to be holding up. This is something I noticed when I first started looking at this a couple of years ago. As recently as 2006, the big gap between male and female earnings started to open up in the early 30s.

genderpay13

Over the last few years it has shifted to the point where the difference between male and female full-time earnings for those in their thirties is only around 1 percent. It’s still to early to say but pay median pay levels seem to be evening out for those in their twenties and thirties.

Here’s another interesting snippet though. It seems that the gender pay gap increases the further up the income scale you go.

Screen Shot 2013-12-12 at 19.15.52

The difference between men’s and women’s pay at the 90th percentile is more than 20 percent. This is consistent with the pay gap rising with age. People tend to get paid more as they get older, particularly in high paying occupations. Many of the woman who might otherwise be in senior jobs have taken lower paid ones closer to home so they can do the school run and look after the kids.

It would be interesting to look at the percentiles for the different age bands but to do that I will need to dig into the ASHE’s massive data bank. In the meantime, I’d welcome your thoughts and theories on this.

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4 Responses to Age and the gender pay gap

  1. Pingback: Age and the gender pay gap - Rick - Member Blogs - HR Blogs - HR Space from Personnel Today and Xpert HR

  2. SimonFa says:

    Given that women are disproportionately concentrated in the public sector, the pay freezes and job losses over the last few years will have had an effect on the overall level of women’s pay.

    I can see why having a more women in the public sector affects employment levels but not why it should have an impact on the gender pay gap, unless women are paid less than men in the public sector? I hope these comparison figures aren’t cross industry without a lot of statistical manipulation?

    As for the age related bit: Some of it will be because a number (no idea what proportion) of high paid jobs require a lot of sacrifices. I spent a number of years travelling around the world working extremely long hours and missing birthdays, wedding anniversaries and even nativity plays. I posit, based on my own experience only, that a lot of this type of work is done by men. At the younger end the proportion of people doing this was probably 60-40 men but at the older, experienced and
    higher paid end, it was probably 90-10 or even higher. Spread this across the whole industry (telecoms in my case) for the older worker this could make some difference.

    Even senior jobs that don’t require the travel do require some sacrifice and include a lot of stress. Perhaps women, sensibly, opt for the domestic side of a relationship? Again taking myself as a sample of one so dangerous to extrapolate, my wife and I had that discussion and made that decision. I’ve never seen any surveys looking at couples that have made that decision.

    • Simon Dalston says:

      “I can see why having a more women in the public sector affects employment levels but not why it should have an impact on the gender pay gap, unless women are paid less than men in the public sector?”

      As the proportion of women in the public sector is much higher than the proportion of men in the public sector, pay restraint in the public sector will increase the UK-wide gender pay gap even if pay differentials within each sector remain constant.

      Also as a general comment – it is worth noting that the gender pay gap is still lower than at any point in the noughties.

  3. sadbutmadlad says:

    The average gender pay gap has increased, but when the average is skewed by more women working part time compared to men because of childcare, has the real pay gap increased?

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