The overall UK gender pay gap has fallen at the fastest rate in six years with a 12.2% differential between men and women
Over the past year, over half (53.7%) of companies reported a fall in their average pay gaps, with the national average standing at 12.2% - a decline of 0.7% from 12.9% in 2021/22, according to PwC research.
The UK Gender Pay Gap report, commissioned by the Big Four firm, identified the most significant annual decrease in hourly pay gaps since 2017.
Of the 10,427 companies that disclosed their pay gaps for 2021/22 and 2022/23, just over half (53.7%) reported a decrease in their average pay gaps.
However, most organisations reported only a small change, with nearly 60% of companies reporting increases or decreases of up to 4%.
In addition, the research also highlighted a fall in the average hourly pay gap, showing a reduction from 9.8% in 2021/22 to 9.2% in 2022/23.
Building societies, banking and insurance sectors had the highest average hourly pay gaps. Public administration, health and leisure had the lowest.
The largest gender pay gap was 30.1% at building societies, while the public administration sector had the lowest at 4.5%.
Compared with last year, the travel sector saw the largest increase in the average pay gap of 2%, while the technology sector saw the largest decrease, by -1.9%.
Katy Bennett, diversity, inclusion and equity consulting director at PwC, said: ‘While on the surface it is encouraging to see the most significant annual decrease in the UK’s mean pay gap this year, the data highlights that it is difficult for organisations to make meaningful reductions to their reporting figures.
‘In order to do this, businesses need to understand the underlying drivers of their pay gaps and address the root causes, such as recruitment and attrition rates, external market pay expectations and organisational structures.’
Since last year, over 35% of companies reported pay gap changes between 0 and 2%. This means that most organisations still struggle with making significant changes to close the gap, and change may take much longer than anticipated.
PwC also found that generally larger organisations with 20,000 employees or more had lower mean hourly pay gaps compared to smaller companies.
Bennett added: ‘Diversity, equity and inclusion reporting and broader pay transparency requirements, such as the EU Pay Transparency Directive, are only getting more complex and high profile.
‘Organisations need to demonstrate they will address the drivers of their pay gaps, moving the focus from reportable numbers to taking credible action to improve equality, inclusion and social impact.’
For more information on gender pay gap reporting obligations, visit BrAInbox today where you can find answers to questions like Where should a gender pay gap report be published?
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