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Why we can’t afford to hit pause on the Gender Pay Gap

With the heatwave, a World Cup and the start of the summer holidays, April 2018 now seems like a long time ago…

Yet rewind three months back and many of us were waiting for the final wave of organisations to report their gender pay gap – the first time ever organisations with over 250 employees were required to do so in the UK.

At the time there was a significant amount of media coverage, a lot of commentary about the causes of the gap, some incredulity at the high figures reported, some misunderstandings on the difference between the pay gap and equal pay, and some fake news questioning the very existence of the gap at all.

Fast forward three months later and whilst we’re in summer-time mode it appears as if it’s all quiet on the pay gap front.

At GenAnalytics we’re using the summer months to ask organisations to really focus on understanding the causes of their gender pay gap, to undertake competitor benchmarking, and begin to implement the steps required to close the gap.

With just over nine months to go before the 2019 reporting deadline we can’t allow this to become a once a year tick box exercise with the pay gap drawer being open and shut once every twelve months.

Here’s why:

• 78% of employers in the UK with 250 staff or more pay men more than women
• The industries with the highest gaps reported include financial services, utilities, manufacturing, construction, professional and scientific, transportation, and retail
• The UK has a higher gender pay gap than the OECD average
• Scotland’s pay gap although marginally less than the rest of the UK is still higher than the OECD average
• Closing the gender pay gap in Scotland would contribute an additional £6.5bn to the economy

So for those employers who are committed to closing the gender pay gap, talk to GenAnalytics about the insights we can provide to support you.

We have been undertaking benchmark analysis for employers in transport and logistics, construction, legal, and financial services. Our advice to any organisation is based around the following principles:

• Ownership
• Accountability
• Honesty
• Transparency
• Data Analysis
• Measurement
• People Investment
• Action for change
• Continuous tracking

Let’s keep the gender pay gap on the agenda. It is the right thing to do but for businesses seeking to attract and retain talent and beat the competition – it’s the smart thing to do.

For a confidential discussion about the gender gap gap or wider diversity challenges please contact us.

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What is the Gender Pay Gap and Why Does it Matter?

What is the gender pay gap? Why does it matter? What can be done to close the gap? Watch @GenAnalytics below and find out more about what the UK Government is doing at: https://t.co/H9p5GiRves #DeliveringforScotland @WomenEqualities pic.twitter.com/59LHsRQuY4

— UK Gov Scotland (@UKGovScotland) April 17, 2018

“>The Gender Pay Gap

GenAnalytics were delighted to talk to the UK Government Scotland Office about the gender pay gap, why it matters and what employers can do to close the gap.

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The Gender Pay Gap – Looking Beyond the Headlines

In the season of glad tidings, comfort and joy there is little cheer to be had when it comes to the gender pay gap. Legislation introduced in April this year requiring all organisations in the UK with over 250 employees to report their gender pay gap figures has seen less than 300 employers reporting to date out of a potential 9000 falling under the compliance requirements.

Indications are that many organisations are still adopting a wait and see approach to publishing their figures thinking that safety in numbers will be better.

At GenAnalytics we are looking beyond headline pay gap figures. If you look at the Government’s reporting site you will see a range of organisations reporting overall pay gaps of 10% – 25% whilst some are over 30% and over 50%. Gender Pay Gap Reporting Site

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Some of these organisations are household names, some are not. A vast number of recognised brands and businesses that we interact with daily as customers or as businesses remain silent on their own figures.

Let’s look however at some of the detail behind the figures of some of the organisations that have published – particularly in the pay quartiles which demonstrate the proportion of women at senior levels.

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In two sample organisations that have reported their pay gap data the trends mirror what we suspect. Despite operating in totally different industries women are not making it through to senior roles. This is almost as stark and concerning as the pay gap figures in general. There are many reasons as to why this is the case – culture, lack of flexible working practices at senior levels, recruitment processes, retaining female talent, unconscious bias to name a few. However if we are really serious about closing the gender pay gap we need a monumental shift to get more women into senior roles and keep them there.

That’s what we are focussed on GenAnalytics – understanding the Why of the gender pay gap and using data analytics to understand where the challenges begin and the measures that can be put in place to solve it. Organisations can talk about the aspirations to close gender pay gaps but until we see these percentages really moving then it remains a wish on Santa’s long list….

We can delve further into the analysis and look at the economic disadvantage faced by women in bonus payments.

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Despite women receiving bonuses at a higher rate than men in one sample and a small fraction less in the other their bonus pay is eye-watteringly lower. Quite simply this is because women are paid significantly less than their male counterparts. Just consider for a moment the economic impact that we could achieve if women’s pay and bonus rates were the same as men, the boost to consumer spending and of course the value that these women would feel in their places of work.

These are the real figures behind the gender pay gap and we can’t lose sight of them.

As we move into a new year the spotlight on this will not go away and we hope to continue to work with clients who recognise that closing the gender pay gap is a business imperative, that diversity matters to them and that they are focussed on attracting, retaining and promoting female talent. These actions will close the gender pay gap but importantly they will close the disparity in organisations and support women to achieve their ambitions.

Jane Gotts

Director

GenAnalytics Ltd

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The Gender Pay Gap – it’s everyone’s business and everyone’s responsibility

“I’m only human after all, I’m only human after all, don’t put the blame on me” a familiar song on the airwaves. Or alternatively consider Delta Airline’s response to so-called price gouging on airline tickets shooting up in the face of the latest Hurricane to hit Florida “It was the Computer’s fault”…..

We are still hearing about the fall-out from the BBC’s gender pay gap reporting on presenters’ salaries but just this week we have seen a new direction being taken by women working at the BBC demanding action. They want someone to take responsibility and do something about it.

Companies across the UK with 250 employees or more must publish their pay gap by next April yet 6 months in just over 60 companies have reported out of a potential 9,000.

What’s the delay?

Based on our conversations with companies we are certainly seeing a bit of a ‘let’s wait and see what others do’ approach.

For companies that have done the analysis there are several areas they are probably considering:

  • Where do their gender pay gap figures sit within their industry?
  • Are they performing better or worse than competitors?
  • How will they explain the gender pay gap to staff?
  • Will this affect their brand reputation?
  • Will this affect their ability to attract and retain talent?

And hopefully, most importantly, they are thinking how do they close the gender pay gap?

For any companies currently in this scenario we would certainly be advising them to take responsibility and action.

Before publishing gender pay gap figures companies should think about:

  • What are they doing right now to promote diversity and inclusion?
  • How aware are their staff on our diversity and inclusion efforts? Are policies just there to tick a box or do they really impact staff at all levels
  • Have they been making progress in promoting women?
  • If they have equal levels of men and women in lower levels of the business have they researched why more women are not being promoted to senior leadership?

By considering all of the above companies can take a serious look at their approach and be open and honest in their gender pay gap reporting.

The Gender Pay Gap will only be closed by companies taking action and it will be individuals within these companies who take responsibility that will drive forward change.

We can’t blame our human nature or computers for the gender pay gap. We need to accept that it exists, that it’s not acceptable, and that collectively we are all going to do our part to close it.

If your organisation is looking at its gender pay gap and needs support, please get in touch. We’d be happy to talk to you.

Jane Gotts

Director

GenAnalytics Ltd

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Mainstreaming Diversity – the journey has begun

Last week GenAnalytics and The Herald brought together nearly 200 individuals from the public, private and third sector for the first Diversity Conference in Scotland.

Following the success of the inaugural Diversity Awards in October last year we wanted to continue to share stories of organisations really making a difference in embedding diversity throughout their workforce. And we knew that we still have to continue to reach out to as many businesses as possible to sell the business case for Diversity – to mainstream this as an economic issue.

Last week we heard about the business benefit to Scotland if we could close the gender pay gap – stubbornly sitting at 16%.

We heard about women in North Ayrshire who earn £180 a week less than men – and the recognition from that local authority that women are central to achieving inclusive economic growth. We also learned about the inescapable link between child poverty and women not in work or in low paid jobs.

Listening to our speakers talk about Diversity as good for the business, good for attracting and retaining talent, good for culture and moral amongst teams, we also heard about the challenges that remain – the uncomfortable conversations we still need to have on race and ethnic minorities participation in the workforce. We were reminded as well on the importance of an inclusive work culture so that everyone, regardless of their background, race or sexuality felt comfortable in their place of work to enable them to be able to do their jobs.

We are making progress – certainly the collective opinions on the day from our delegates and speakers recognised that – however the overwhelming conclusion was that we are only just at the beginning of truly mainstreaming diversity.

This is our focus at GenAnalytics.

We are working with organisations unlock the business and economic potential that a diverse workforce will deliver. There is still a lack of data and evidence on gender equality across all of Scotland’s main industries, on the participation of ethnic minorities, on the potential that we could harness from more people with a disability securing jobs.

We will continue to use data to mainstream Diversity.

This is what GenAnalytics set out to do just over 18 months ago. We are also on a journey but in this short period of time we have worked with some fantastic partners who share our mission and ambition. We look forward to continuing our work with them and identifying new companies and organisations to work with until we can truly say that we have unlocked the economic potential of everyone in our economy.

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What’s United Got To Do With UK Pay Gap Legislation?

This week, United Airlines clearly demonstrated the bottom line cost to a business of negative consumer power and how quickly social media can damage corporate reputation. Whilst there was no immediate impact on United’s market valuation, in fact its shares rose immediately after the event, United have still to learn the longer term financial impact, the cost of rebuilding their brand and customer trust and of repairing their corporate reputation.

Whilst the share price rise may seem counter-intuitive, analysis by Steel City Re, a US based company which analyses reputational strength and resilience of public companies, shows that markets can often be slow in responding to corporate reputational damage. Speaking in Benzinga, an online publication, Steel City Re estimate that it can take the markets twenty weeks to recognise the severity of reputation events but then the company’s share price can be expected to fall by 25%. This is due to a progressive response to the incident by many customers and stakeholders who move from a position of tolerance to one of disappointment and dissatisfaction with the brand or organisation.

In April 2017, mandatory gender pay gap reporting became law in the UK for approximately 8,000 companies employing more than 250 people. Whilst the connection to the United experience may not seem immediately obvious, given that the UK gender pay gap is on average 18%, rising to over 40% in some sectors the requirement to publish company specific gender pay gap data will be giving cause for concern in many boardrooms and executive suites across the country particularly for some big brand and household names. A study by pay and reward consultants Mercer, suggested that 61% of organisations were worried about the impact of pay gap reporting on their reputation not just in terms of its potential impact on staff and shareholders, but also on how this data will be interpreted by the media, politicians and its customers.

Leading gender analysts Catalyst.Org, estimates that, on average, 67% of all UK Household consumption is controlled or influenced by women. And it much greater in many key household areas. As I highlighted in my last blog on female consumer purchasing power, women make the decision or influence the purchase of 92% of holidays, 65% of cars, 93% of food, 91% of homes and 61% of personal computers. And with the extensive and growing use of social networks such as Facebook and sharing of social reviews by women, social media is now playing an increasingly important role in the decision-making process of many women and in influencing their purchasing decisions.

Some companies have decided to make their gender pay gap information public well in advance of next year. Deloitte, PWC and EY have led the way in publishing their pay gap information and Virgin Money, a bank and financial services group owned by the Virgin Group and employing over 3,000 people published its gender pay gap earlier this year. Virgin Money’s mean gender pay gap was 36%, compared to a financial services sector average of 39.5%, both well above the UK average.

The company who actively promote “recognising everyone as equal” admits that the pay gap is largest at senior management levels, which have a 21% female to 79% male ratio. The rest of the organisation has a 44:56 male to female split. Headed up by a female CEO, Virgin Money publicly recognises that it has work to do to address this gap and is aiming for a 50/50 gender balance by 2020 which they believe will help resolve their current pay gap.

So far, the Twittersphere has been relatively silent on these organisations and public and consumer reaction to the earnings differentials appears relatively muted. However, as we head into 2018 and many major consumer and household names publish their gender pay gap information, it may prove difficult to predict customer reaction and for many brands, like United, it may be enough to prove the tipping point between consumer tolerance and disappointment.

Dr Lesley Sawers

GenAnalytics Ltd

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The “Why” of Diversity and Inclusion

The “Why” of Diversity and Inclusion

Simon Sinek famously inspired many businesses and individuals to understand their purpose – to start with “Why”. His best seller is based on the fact that all of us, be it in a business or as individuals, have a purpose and you need to understand your own, before you focus on the what you do and how you do it.

At GenAnalytics we have a very clear understanding of our “Why” –  we want to work with organisations and companies across Scotland to create more inclusive and diverse workplaces. We believe this “Why” will enable more people to realise their full potential, have equal access to opportunities and at the same time help deliver stronger economic performance for the organisation and support inclusive growth for the economy. It’s a hugely ambitious “Why”, but our “Why” doesn’t stop with our own business objectives.

We believe the “Why” of diversity and inclusion is hugely important for everyone, as is the “What” we’re doing and “How” we’re dealing with the issues and opportunities diversity and inclusion creates in our workplaces and businesses across Scotland.

To focus on this big national question, on the 23 May Scotland will host its first ever National Diversity Conference, delivered by GenAnalytics and Herald Scotland Events. We are delighted to be supported by our partners: Standard Life plc, MacRoberts, Skills Development Scotland, City of Glasgow College, YSC, Wheatley Group, Royal Mail, Taylor Wimpey, ScottishPower, and Scottish Canals.

Here are some of the “Why’s” we will be focusing on:

Why do women earn £183 per week less than a man?

Why is the unemployment rate higher for workers from ethnic minority groups than for white workers?

Why are disabled people twice as likely to be unemployed than non-disabled people?

Why are only 17% of jobs in ICT in Scotland held by women?

Why aren’t more companies doing more to support diversity and inclusion in our workplaces?

Why aren’t we better at sharing best practice and what-works knowledge?

To learn and share in the Why”, “Where”, “What” and Who” of Diversity and Inclusion in Scotland, then join our conference conversation and let’s collectively start with “Why”?

http://newsquestscotlandevents.com/events/the-diversity-conference/

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Diversity Delivers Results – be a part of the success

Diversity Delivers Results. There is overwhelming evidence that companies who embrace diversity are more profitable than those who do not.

Diverse organisations can attract and retain top talent.

Diversity not only delivers results for businesses – it makes economic sense.

McKinsey have estimated a boost of $12 trillion to the global economy if we could reduce the gender gap in workplaces across the world.

In Scotland, recent research by PwC has indicated that our economy could receive a welcome boost of up to £6.5 billion if we were able to close our gender pay gap.

Across businesses, organisations, the public sector, and the third sector we know there are outstanding examples of workplaces who embrace diversity and recognise talent – despite backgrounds, gender, race or disability.

However, we know that we need to do more to mainstream diversity into a must-do rather than a nice-to-do.

Across our economy women are more likely to be in low paid, low skilled and part time work compared to men. Men are currently more likely than women to work in senior positions and men dominate the higher paid sectors such as engineering, finance and banking.

Only about half of people of working age with a disability are in employment compared to 80% of able bodied people. The employment rate for people with learning disabilities is 26%.

Employment is significantly higher for white ethnic groups in Scotland than those from ethnic minorities.

One in five lesbian, gay and bisexual employees have experienced discrimination in their workplace because of their sexual orientation within the last five years.

We have made progress to improve diversity in Scotland’s economy but the statistics above show that we have a long way to go.

That’s why we are organising Scotland’s first Diversity Conference with The Herald. We will highlight best practice, hear from expert speakers, and share knowledge from all sectors of the economy on how we can work together to achieve the changes we know that we need to ensure everyone in our economy can achieve their potential.

We want you to join us and share your views and contribute to the events success. For further information and to book your place please visit – http://newsquestscotlandevents.com/events/the-diversity-conference/

Diversity delivers results. Join us to play your part in delivering diversity and success for our economy.

Jane Gotts

Director

GenAnalytics

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Gender Pay Gap v Equal Pay – The Difference and Why

With the forthcoming Economy, Jobs and Fair Work Committee’s current inquiry into the Gender Pay Gap in Scotland I thought it would be helpful to outline the distinctions between equal pay and the gender pay gap. Many think we don’t have a pay gap in our economy due to equal pay legislation.

Equal Pay and the Gender Pay Gap are two completely separate issues.

Equal Pay is covered by the Equality Act of 2010 which means that men and women in the same employment performing equal work must receive equal pay.

The Gender Pay Gap is the difference between men and women’s average earnings in a business or across the labour market. The Pay Gap is expressed as a percentage of men’s earnings.

The Gender Pay Gap exists for a whole host of reasons.

Women are still more likely to work in part-time and low paid roles compared to men. In Scotland, women account for 76% of all part-time workers.

The average gender pay gap across the UK is 18% however in some sectors it is much higher including financial services where it is estimated to be as high as 39%. Simplistically we can say that is because in this sector there is likely to be more men in higher paid roles than women.

The Gender Pay Gap isn’t unique to Scotland or the UK. Global estimates suggest that it could take another 140 years for the gap to close at a global level.

So in Scotland – how do we tackle the gap that remains? This is complex and there is no one correct answer but taking a detailed and evidenced based approach to understanding the facts is a start.

If we know what the gap is key industry sectors in Scotland we can start to look at how we use the tools available to us to close it. These include encouraging more girls into Science and Technology at a younger age and maintaining this interest beyond school to lead to career opportunities. For women in employment, how do we support more women to move from part-time to full-time work? How do we look at developing more women in work into senior leadership roles? How do we reward success in our companies? Are promotions solely based on presenteeism, finding someone in the boss’s own image or through closed networks?

This is a massive challenge but also a huge opportunity for Scotland’s economy. More women working and earning means more economic growth – inclusive economic growth.

We all have a part to play and the Economy, Jobs and Fair Work Committee’s inquiry is an important step in the journey.

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Women Consumer Power

Candace Bushnell, the “Sex and the City” author, famously once said “Women with money and women in power are two uncomfortable ideas in our society”. But the fact is that the economic power of women as earners, consumers, purchasers and influencers has been growing steadily for decades.

Whilst the media is dominated by issues linked to pay gaps, board membership, career progression and the many obstacles faced
by women, and it is right that we focus on the inequalities and social injustice that still exist for many women today, what is often forgotten is the scale and the extent of the economic power and influence that women have.

Women currently control $20 trillion or 27% of the world’s wealth. In the UK 46% of the 376,000 millionaires are female and 18 women are now in the exclusive billionaires’ club (2016). And this figure is expected to grow as more women enter these power indexes, no longer claiming their position due to family inheritance or divorce settlements.

More women are graduating with degrees, and more women are entering the workforce. Not only are women earning more as they scale professorial and corporate ladders, but they are also setting up businesses at a faster rate than men. One third of businesses in the world are owned by women. In Scotland, over 80,000 businesses are owned by women contributing over £5 billion to the Scottish economy each year, that’s a lot of female buying and influencing power.

Women now represent the largest market opportunity in the world and female consumer purchasing power exceeds the GDP of India and China combined (Forbes 2013). Women are fast becoming “prominent creators of wealth” and it is expected women will control 75% of all household spending by 2028.

The influence of women on the consumer economy is huge, leading many commentators to suggest that if consumer spending had a gender it would be female. Leading gender analysts Catalyst.Org, estimates that, on average, 67% of all UK Household consumption is controlled or influenced by women. And it is much greater in many key household areas.

Women make the decision or influence the purchase of 92% of holidays, 65% of cars, 93% of food, 91% of homes and 61% of PCs and with the extensive and growing use of social networks such as Facebook and sharing of social reviews by women, social media is now playing an increasingly important role in the decision-making process of many women.

In response to this “gender flip” or changing economic dynamic, most consumer businesses and advertising specialists have become much smarter in terms of how they “sell” to women.

Yet this consumer industry experience is not reflected in the response by many other companies to increasing female economic power. However, many organisations do understand that learning from the consumer industry could be vital for them as they look to sell to the growing number of senior female business decision makers, create greater gender diversity in their organisation or recruit and retain more women in their workforce.

Deloitte, a global accounting and consultancy practice, has recognised that the first step to achieving greater diversity within their business is to focus on their clients or customers who are increasingly female decision makers – where a “one size fits all” marketing or sales approach no longer works.

They have effectively transformed their internal HR diversity training into a key business tool, successfully winning more contracts and pitches and at the same time raising levels of awareness of the benefits of gender diversity within their own organisation.

Similarly, many recruitment companies are understanding the impact of language and job advertisements on success rates. #WordsthatWork, an Australian Government initiative has recognised, as in consumer messaging, business words are powerful.

When it comes to recruitment, words can encourage or discourage women from applying for jobs, they can help reduce unconscious bias and provide a broader candidate field. Research suggests that women are less likely to apply for male sounding roles, described as “assertive” or “determined” and similarly for software companies, substituting the word “developer” for “hacker” increases the number of female applicants.

With 71% of social media users’ women and 78% of women using the internet for product information, social marketing is also becoming an increasingly important tool and channel to influence decisions and to engage women on a range of business and work related issues. Studies show that messages on users’ Facebook feeds can significantly influence voter patterns and social media played a key role in influencing decisions in the recent US Presidential elections.

The convergence of the consumer and business world is driving change in our homes, workplaces, communities and society.

More women with more money and more power is something we all need to get used to, uncomfortable or not.

Dr Lesley Sawers

Executive Chair

GenAnalytics Ltd

This article first appeared in Business Women Scotland Magazine February 2017