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, based on a brand new report.

The nation’s common pay hole widened by 2.4 share factors to 14.4 per cent in 2021, accountancy big PwC present in its Ladies in Work index.

It signifies that the hole between what the common man and the common ladies is paid in hourly pay has received larger, indicating UK firms have taken a step backward relating to gender parity.

On the fee the pay hole is closing, it should 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 nations which might be 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 pressure participation fee has declined and extra ladies have grow to be unemployed.

Around the globe, progress in direction of gender equality in work was set again by no less than two years by the influence of the Covid pandemic, the report discovered.

Covid, childcare and the gender pay hole

Ladies’s employment losses from Covid had been comparatively worse than males’s.

Furthermore, childcare prices have risen dramatically within the UK since 2015 whereas wage development 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 revenue of a household on the common UK wage, in comparison with as little as 1% in Germany.

It signifies that ladies have born the brunt of upper childcare prices relating to their careers, the report instructed.

Larice Stielow, senior economist at PwC, mentioned: “The motherhood penalty is now probably the most vital driver of the gender pay hole and, within the UK, ladies are being hit even tougher by the rising value of residing and rising value of childcare.

“With this and the hole in free childcare provision between ages one and three, extra ladies are being priced out of labor.

“For a lot of it’s extra inexpensive to depart work than stay in employment and pay for childcare, particularly for households at decrease revenue ranges.”

Alongside extra inexpensive childcare, societal attitudes about gender roles must shift as a way to sort out the motherhood penalty, the evaluation instructed.

It discovered that fathers taking extra paternity depart may pave the way in which for extra ladies remaining in full-time employment within the UK, subsequently enhancing its general rating within the index.

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