UK gender pay gap widens as childcare costs worsen ‘motherhood penalty’

The UK’s gender pay hole has widened as sharp will increase in the price of childcare has worsened a “motherhood penalty”, pricing many ladies out of labor altogether, based on a brand new report.

The nation’s common pay hole widened by 2.4 proportion factors to 14.4 per cent in 2021, accountancy large PwC present in its Ladies in Work index.

It implies that the hole between what the typical man and the typical girls is paid in hourly pay has acquired larger, indicating UK firms have taken a step backward with regards to gender parity.

On the charge the pay hole is closing, it’ll now take greater than 50 years to succeed in gender pay parity, PwC stated.

Moreover, the UK dropped 5 locations within the agency’s annual index of girls’s employment outcomes, throughout 33 international locations which can be members of the Organisation for Financial Co-operation and Growth (OECD) and included within the evaluation.

The UK stood in 14th place in 2021, down from ninth place in 2019, that means that in addition to the pay hole, indicators like the feminine labour drive participation charge has declined and extra girls have develop into unemployed.

All over the world, progress in the direction of gender equality in work was set again by at the very least two years by the affect of the Covid pandemic, the report discovered.

Covid, childcare and the gender pay hole

Ladies’s employment losses from Covid have been comparatively worse than males’s.

Furthermore, childcare prices have risen dramatically within the UK since 2015 whereas wage development has slowed, PwC stated.

Common nursery prices per week rose by greater than a fifth between 2015 and 2022, whereas common weekly earnings rose by 14 per cent.

And internet childcare prices represented nearly a 3rd of the revenue of a household on the typical UK wage, in comparison with as little as 1% in Germany.

It implies that girls have born the brunt of upper childcare prices with regards to their careers, the report recommended.

Larice Stielow, senior economist at PwC, stated: “The motherhood penalty is now essentially the most important driver of the gender pay hole and, within the UK, girls are being hit even tougher by the rising value of dwelling and growing value of childcare.

“With this and the hole in free childcare provision between ages one and three, extra girls are being priced out of labor.

“For a lot of it’s extra inexpensive to go away work than stay in employment and pay for childcare, particularly for households at decrease revenue ranges.”

Alongside extra inexpensive childcare, societal attitudes about gender roles must shift so as to sort out the motherhood penalty, the evaluation recommended.

It discovered that fathers taking extra paternity go away might pave the way in which for extra girls remaining in full-time employment within the UK, subsequently enhancing its total rating within the index.

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