A third of UK manufacturing businesses are unprepared for new gender pay gap reporting requirements currently being consulted on by the government.

Manufacturers’ organisation the EEF said that there was high awareness, 83 per cent, amongst manufacturing and engineering firms of the new requirements aimed at solving the imbalance of pay between men and women.

However, according to its survey, seven per cent of respondents said they had low understanding and 29 per cent said they had little preparedness of the upcoming changes.

Three in ten firms indicated concern about the amount of work that will be required to provide gender pay gap data, with only ten per cent currently reporting any gender pay information.

Many others, EEF said, do not have the right systems in place to provide accurate and robust pay data.

Indeed only a third have undertaken a pay audit in the last five years with the same percentage not doing any work to define pay and job roles. A half don’t have an official pay scale with pay being determined individually and case-by-case.

But despite the significant challenges the EEF said firms see the forthcoming reporting requirements as an opportunity to improve.

Just under half, 47 per cent, said it was a great opportunity to benchmark themselves against peers and other industries, while 38 per cent said that the work needed to be undertaken to provide the data will help each to get to grips with pay structures and auditing.

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Over a quarter said gender pay gap reporting will provide the impetus needed to overhaul pay structures and to establish better processes.

Tim Thomas, head of employment policy and skills at EEF, said: “If asked for the data today, it’s clear that the majority of manufacturing and engineering firms would struggle to provide it. Not only are there significant gaps in many firms’ pay processes and systems that will make providing accurate and robust information a real challenge, there is also a real concern that gender pay gap reporting could reflect poorly on industries with low numbers of skilled female workers. 

“It’s critical that the data requirements aren’t allowed to undermine the huge efforts being made to attract women into skilled roles in industries where they are currently under-represented. If we are to avoid the pitfalls then providing context to published gender pay gap data, support for businesses being asked to provide the data and a phased roll-out will be key.”

The government’s consultation, which ends on 6 September, seeks views on its manifesto commitment to require larger employers to publish gender pay information. These regulations will cover private and voluntary sector employers in England, Scotland and Wales with at least 250 employees.

The consultation also seeks views on wider action that can be taken to inspire girls and young women, modernise workplaces and support older working women.