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, in response to 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 signifies that the hole between what the common man and the common girls is paid in hourly pay has obtained greater, indicating UK firms have taken a step backward on the subject of gender parity.

On the charge the pay hole is closing, it can now take greater than 50 years to achieve gender pay parity, PwC mentioned.

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

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

World wide, progress in 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 progress has slowed, PwC mentioned.

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 web childcare prices represented virtually a 3rd of the earnings of a household on the common UK wage, in comparison with as little as 1% in Germany.

It signifies that girls have born the brunt of upper childcare prices on the subject of their careers, the report advised.

Larice Stielow, senior economist at PwC, mentioned: “The motherhood penalty is now essentially the most vital driver of the gender pay hole and, within the UK, girls are being hit even tougher by the rising price of dwelling and rising price 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 earnings ranges.”

Alongside extra inexpensive childcare, societal attitudes about gender roles must shift with a purpose to sort out the motherhood penalty, the evaluation advised.

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, due to this fact bettering its total rating within the index.

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