November 11, 2016

Women in UK tech “paid 9% less than men”

Women in the UK’s technology sector are offered less money than men in equivalent roles—and the discrepancy gets wider as they progress in their careers, according to a report by recruitment company Hired.

The study of 10,000 employment offers found that the median salary of women working in tech was 9% lower than their male colleagues—equivalent to £5,000 a year.

The report also found that the gap in pay increased with experience: women start out in their careers asking for roughly the same salaries as men, but receiving 7% less. After two to six years’ experience, this gap increased to 10%. Women’s salary expectations also decreased over time, whereas men’s salaries increased in line with their higher expectations.

However, the gender pay gap remains lower in the tech sector than it does for the UK as a whole, where it stands at 13.9%.

The report was published to coincide with Equal Pay Day on November 10, the date from which the Fawcett Society estimates women in the UK will effectively be working for free until the end of 2016. Equal Pay Day falls one day later this year than it did in 2015 as the pay gap has fallen slightly; however, at the current rate, the Fawcett Society estimates it will take over 60 years to close completely.

In a new article for IZA World of Labor, Boris Hirsch writes about gender wage discrimination in the labor market. He argues that a large part of the pay gap may be explained by “monopsonistic discrimination”: employers exploiting women’s lower wage sensitivity, as women may be motivated by other factors than pay to a greater extent than men.

Hirsch writes that: “Since wage discrimination raises employers’ profits, it is fostered by market forces and thus likely to persist in the long term. Fighting monopsonistic discrimination involves introducing policy measures to raise women’s wage sensitivity, for example, through improved childcare or more flexible working hour arrangements, as well as introducing equal pay legislation.”

Related articles:
Gender wage discrimination by Boris Hirsch
Equal pay legislation and the gender wage gap by Solomon W. Polachek
Gender differences in competitiveness by Mario Lackner
Explore more IZA World of Labor content about the gender divide