Gender Pay Gap is Harming Economy

According to the Women and Equalities Select Committee, a group made up of MPs to help tackle issues of inequality, the UK’s economy is suffering as a result of the gender pay gap. According to a recent report by the committee, a “motherhood penalty” is not only holding back women’s pay when compared to that of men, but also costing the UK £36 billion a year.

The group said that the government has been failing to close the pay gap in recent years, and that action was needed in order to tackle the issue. The report called for specific policies designed to deal with the barriers that women face, such as lower pay for part time work and disproportionate levels of childcare responsibility compared to their male counterparts.

Committee chair Maria Miller said that the disparity in the pay that men and women receive for equivalent work is “holding back women and that isn’t going to change unless the government changes its policies now.”

However, the report said that the impact of the pay gap goes beyond that on the individuals affected, and has a noticeable, negative influence on the UK economy. Women are given disproportionate responsibility for taking leave from work in order to care for children, and are also more likely to be trapped in part-time jobs and jobs which are below their level of skill. The resultant failure to effectively utilise women’s skills properly, the report said, is costing the country the equivalent of 2% of its total GDP every year – a total annual bill of around £36 billion.

According to Miller: “The pay gap represents a massive loss to the UK’s economy and we must address it in the face of an ageing workforce, a skills crisis and the need for a more competitive economy.”

The committee’s report pointed to a number of policies which could potentially help the situation. For example, it suggested that fathers and second parents gain access to three months paid leave for the purposes of childcare, so that this responsibility can be shared more equally between men and women. It also called for better support for women returning to work, suggesting that a dedicated national scheme could be set up for this purpose.

Sarah Jackson, the chief executive of Working Families, a family charity, supported these proposals. Jackson said “A decent period of paid paternity leave would allow more fathers to care for their young children and push this out of the domain of ‘women’s work’ for good.”

Figures from the Office for National Statistics show that the gender pay gap currently stands at 19.2%, with the average woman being paid nearly a fifth less than the average man. This figure has remained almost static for the past four years. Older women are more seriously affected, with those aged 50-59 getting paid 27% less than men on average.

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