The issue of the gender pay gap has raised its thorny head on a number of occasions throughout 2017.
Most notably, the publication of the BBC’s annual report made front-page news in the summer with the revelation that two-thirds of Auntie’s stars earning more than £150,000 a year were male. More recently, Equal Pay Day was ‘celebrated’ on November 10 – the day from which women effectively stop earning for the rest of the year, such are current levels of inequality over wages.
Depending on what calculations you use, the overall national gender pay gap is about 17-18%. In 2011, the Chartered Management Institute said it would take another 98 years to achieve total pay parity; some writers believe that even this prediction is optimistic and that the gap will never be eradicated.
But what about the nation’s 5.5 million small businesses, the lifeblood of the economy? Have SMEs done more than larger companies to reduce the gender pay gap?
To the very best of our knowledge, never before have small business sectors been focused on to distinguish whether it is better to work at, or set up, a small company if you want to help eradicate the gender pay gap.
So that’s where Informi set to work to find out.
SME-dominated sectors have worked twice as hard at reducing the gender pay gap
Without wanting to spoil the full results of our report, our key findings include:
- The gender pay gap in SME dominated industries has fallen from 22% to 13% since 2008, compare to a national fall from 21% to 17%
- Every SME-dominated industry reported double-digit wage growth for female pay over the past decade
- At the current rate, wage equality across these industries will be achieved by 2034
So while the gender pay gap in 2008 was around the same as the national figure, the gap in the 12 SME-dominated industries we focused on has, significantly, been reducing at TWICE the rate as it has nationally.
But why? And what can large companies, who after all are responsible for publishing their own gender pay gaps by April 2018, learn from SMEs? We spoke to some small business owners to help provide some of the answers.
Tradition and legacy may hold larger companies back
Anna Skopets is the founder of TreeVitalise, which produces organic birch water designed to be a refreshing, low-calorie alternative to soft drinks and juices. She believes that SMEs are in a much better position to adapt to the changing marketplace, and points to countless examples of female entrepreneur success stories.
“There is, inevitably, much more rigidity and overtness to change in big companies,” says Anna.
“Their complex organisational structures are well rooted in the past and are in the way of very much-needed change. With the millennials taking the driving seat of the economy, they are changing the overall professional culture. Of course, this is much more noticeable at start-up and SME-business level.”
Kim Farrall (pictured above left) is a graphic designer based in Cheshire, and co-founder of Off Grid, an independent design agency. Her business deliberately seeks to work with businesses they are inspired by and who are themselves trying to do something different, meaning that there is a mutual interest between Off Grid and their clients.
“In a small business, you get to know people within your business and truly appreciate their worth, as a person and not just a statistic,” says Kim.
“We can be extremely agile as an SME. Our rates, hours and team can inflate and contract on a project by project basis, meaning that our company can fit around many other businesses.
“Large businesses can’t change in such a way. They become shackled by the processes. No decision can be made quickly, and in a world that is moving quicker each day, you can become outdated, immovable and unequal.”
Chloe Chambraud, gender equality director for Business in the Community, whose members work to build a fairer society and more sustainable future, added that women are held back in part due to the industries where the money traditionally goes.
“For example,” Chloe said, “women are over-represented in the ‘five Cs’ – cleaning, caring, cashiering, clerical and catering – which are traditionally low-paid and insecure roles.
“Meanwhile, male-dominated sectors such as STEM (science, technology, engineering, and mathematics) are also the most likely to have the highest gender pay gaps according to the Office for National Statistics.”