Pay gap: do women earn 80p for every £1 earned by men?

10 August 2015

"Under the coalition government, the gender pay gap narrowed. For full-time workers under 40, it is almost zero. But overall, a woman still earns just 80p for every £1 earned by a man."—David Cameron, 14 July 2015

The government is holding a consultation on closing the gender pay gap. Writing about it in the Times, David Cameron reeled off a number of statistics about the pay gap.

Each of the claims is accurate, although they use different measures of the pay gap, and it isn't explained what those measures mean.

A big part of the 20% pay gap Mr Cameron mentions is down to women being more likely to work in part-time jobs than men are. These jobs pay at a lower hourly rate. The pay gap for full-time employees is closer to 9%, and for part-time employees it's actually negative—women in these jobs earn more per hour than men.

Neither statistic is designed to show differences in pay for the same work. They don't take into account relevant factors like the industry or role worked in, or the qualifications or experience of workers, for example.

The median woman's hourly earnings are 81% that of the median man's

Mr Cameron's figure is for the difference in median hourly wages for male and female employees.

What this tells us is that if we arranged men and women by their hourly pay, and then compared the middle man with the middle woman, we'd find the woman gets 19.1% less per hour.

Because this doesn't take any account of how many hours they work, or how much overtime pay they get, it's not the case that the total take home pay of the median woman would be 81% of that of the median man.

For the median woman working full-time hourly earnings are 91% of the median full-time man

The measure preferred by the Office for National Statistics puts the pay gap at 9.4%. This is the difference between median hourly wages for full-time employees.

Women are more likely to work part-time, and part-time workers of both genders get paid less than full-time workers. Taking part-time workers out of the equation lifts the median earnings for women more than it does for men, and that closes roughly half of the 19% gap Mr Cameron is talking about.

That's true even though the pay gap for part-time workers is negative; women working part-time have a higher median hourly wage than men working part-time.

Two out of three measures of the pay gap narrowed under the coalition

Mr Cameron is correct to say that under the coalition, the pay gap fell to record lows for full-time employees and for employees overall.

The gap for part-time employees didn't change significantly, although it's widened over the long term. However, in the context of addressing women being paid less the negative pay gap for part timers is probably of less concern to Mr Cameron.

For full-time workers under 40 the pay gap is smaller

The pay gap is 2.3% for full-time workers under the age of 40, which Mr Cameron described as almost zero. The pay gaps for 22-29 and 30-39 year olds are both negative. The median female wage in these age groups is higher than the median male wage.

For all employees, including part-time workers, the gap is 11.6%.

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