The casual observer could be forgiven for thinking that progress on the gender pay and opportunity gap is government’s job. Politicians and policymakers frequently cite things like decades of equal opportunities legislation, developments to the benefits and tax credits system, childcare provision and support, and government’s enterprise-boosting activities as the key drivers of progress on gender equality in the workplace. So when the gender pay gap shrinks to an historic low, as it did towards the end of last year, Whitehall gives itself a big pat on the back.
This is understandable but obscures the crucial role that employers play. A quick glance back through recent history attests to this.
For example, take reforms to in-work benefits. The introduction of tax credits, and their precursor the Family Credit, boosted employment for parents (mothers in particular) by strengthening financial incentives to work. But the magic wand of “work incentives” did not operate alone. Wired in were requirements to work a minimum number of hours each week before being eligible for support – such as the expectation of 16 hours of work for single parents. And the success of these benefits in raising female participation rested partly on employers becoming aware of such rules and offering work opportunities that suited parents, at or just above the required number of hours. The synergy of incentives created by policymakers and jobs created by employers was essential to the policy’s success.
There are more obvious examples of how government policy relating to gender pay and opportunity rests on employer leadership. Although it will shortly be reformed, up to now a major pillar of childcare support for working mothers has been the childcare vouchers scheme, which reduces the costs of childcare by allowing it to be paid out of pre-tax salaries. But such tax breaks depend on employers opting into the scheme.
Looking to the future, the role of employers in driving progress on gender pay and opportunity – in complement to policy developments – is more vital than ever. Recent extension of the “right to request” flexible working to all tenured employees (not just parents) prompts employers to consider other groups that might benefit from flexibility, such as older female workers, who remain further behind in terms of pay equality. Ensuring that jobs are designed so as to maximise the talents of this more experienced group of workers should ultimately prove a win-win.
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Reform to the benefit system through the introduction of Universal Credit will place new requirements on some recipients of in-work benefits to seek to progress to more hours or higher pay rates. Although mothers with younger children are unlikely to be affected, many others who will are in low-paying, female-dominated industries like cleaning and social care. An understanding of these changes and complementary support from employers will be essential, particularly if these industries want to retain existing talent. For example, exploring how flexibility and part-time working (the very attributes that attract many women to these sectors in the first place) can be spread up into higher-paying roles will maximise the opportunities for lower-paid women to progress.
Finally, the new government has committed to increasing the amount of free childcare available to working parents of young children. In making work that bit easier for experienced female candidates returning to work after having children, this presents a new opportunity for employers to expand their talent pool. Designing jobs sensibly and flexibly with an understanding of local childcare markets will be key to attracting and retaining the best staff.
The latest competition in the UK Futures programme, recently announced by the UK Commission for Employment and Skills (UKCES), challenges employers to think about redesigning jobs with flexibility in mind. Whilst the ultimate aim is to help close the gender pay and opportunity gap, UKCES recognises that innovations in good job design and working practices are the first step to achieving a longer-term impact on pay and progression. In the end, solutions have to work for both employers and employees if real change is to be achieved and maintained.
In short, government can provide the tools to help close the gender pay and opportunity gap – but it’s up to employers to use them to benefit their business and their staff. And whilst politicians share the limelight for progress made, we must never lose sight of the centrality of employer practice in sowing the seeds of change.
Laura Gardiner joined the Resolution Foundation in March 2014 as a senior research and policy analyst. She specialises in analysis of the labour market, currently focusing on issues including pay trends, self-employment and the social care workforce. She also conducts the Foundation’s work on housing affordability.
Prior to joining the Resolution Foundation, Gardiner spent four years at the Centre for Economic and Social Inclusion, where she worked on unemployment, young people, welfare reform and housing. Laura studied social and political sciences at Cambridge University before completing a master’s degree in public policy at Brown University in the US.
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