Gender pay gap at senior levels due to ‘poor signalling’

The traditional linear pay and career structure is one of the biggest obstacles to gender pay parity, according to research from Cass Business School.

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Commenting on the latest gender pay data, Professor Chris Rowley, Professor of Human Resource Management at Cass Business School at City University London, suggests pay imbalances can be addressed by adapting organisational structures, not least to account for career breaks most often taken by women.

Pay gap rises with education

“The recent research on gender pay gaps is a ‘curate’s egg’," commented Professor Rowley. "The IFS shows a decline in the gender wage gap among the lowest educated. However, the pay gap widens after having children.“While this could indicate a new, more equal cohort rising through the workplace and organisational hierarchy, therefore eroding gender pay gaps over time, it could also reflect the fact that that careers and pay diverge when women have children.”

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Maternity leave is a known pinch-point for women hoping to progress their careers after starting a family. The wealth of new data continues to highlight the impact of parenthood on women and their progression to senior roles in stark terms that are difficult to dismiss, especially with the planned requirement for large companies to be more transparent on the issue and report gender pay in the UK next year.

Fair pay and opportunities to progress

“Another reason for the pay gap is the continued gender imbalance in senior posts and promotions,” continues Professor Rowley. “This reflects our own research, which shows career barriers are due to poor ‘signalling’ of success for female directors and structural issues.”According to the Cass Business School’s research, signalling comes in the form of:
  • networks and nomination process bias
  • role model and mentor shortages
  • work–family balance
  • legal ambiguity and policies
  • cognitive behaviour.
“All of this is worrying. Research shows gender diversity actually delivers better financial results, organisational cultures and decision making,” concludes Professor Rowley.“The benefits of part-time working should be recognised, measured and rewarded better by management, in terms of pay and supporting career paths and patterns that are not the typical ‘linear’ ones.”
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