Why do female freelancers earn less than male counterparts

“It's a form of self-sabotage that I can't afford to keep doing”

Women's work: Why are independent working women doing themselves out of the same income as men? (Getty)

When you are your own boss, you can set your own rates. Most of the time anyway. If that’s the case, why are some reports suggesting the pay gap among the self-employed is running at a massive 40 per cent?

There are no simple explanations. Although many of the underlying causes of the salaried worker gender pay gap also apply to self-employment, there are other insidious factors at play that are harder to measure.

Self-employed workers are not a homogenous group. Among their number are limited company owners, contractors, freelancers, and those who have permanent jobs alongside one or more side hustles.

The number of women working for themselves is rising rapidly – the Pensions Policy Institute found women made up 97% of the net increase in self-employed workers last year.

In theory, self-employed workers can set their own rates for the job, although many will tell you that in certain sectors, like publishing, clients tell you the rate they are offering – take it or leave it.

In the creative industries, men command an average day ray of £319, £15 higher than women’s, according to research by jobs platform YunoJuno. It found women take higher rates across strategy and client service roles, but men’s rates can be as much as £50 a day higher across other disciplines including creative, design, UX and film.

Part of the problem is women setting their own rates dramatically lower than their male competitors. Lee Kemp is a director and owner of Vermillion Films. He said two-thirds of freelancers he encountered who “drastically” underpriced themselves were women. “Immediately you think it’s because they are inexperienced or they’re not very good, but that is not always the case,” he said.

“We start the conversation with ‘what are your rates?’. On one job, the actress was half the price of the actor. The guy put down £250 a day and the woman said £125 a day. We said ‘that’s ridiculous’ and bumped her up.”

In this instance, the female actor didn’t know what she was worth and was surprised to be told, but in other cases women do have a sense of what they should be charging, they just struggle to do it.

Self-sabotage

Helen (not her real name) has been a freelance writer and editor for 10 years and often knowingly undercharges for her work in what she calls “self-sabotage”.

“I still find invoicing a very emotional process. I suffer guilt, self-doubt, anxiety. I always invoice late, and if I am working with a client on a day rate basis, I often under-invoice. Sometimes I prepare invoices not based on hours worked, but on how much budget I think the client has, and how I rate my own self-worth.

“My day rate is also pretty low, especially compared with men in a similar role. When I worked for an agency, they would charge clients double my normal self-assigned day rate,” she said.

“I have always felt imposter syndrome and it definitely influences my relationship to money and invoicing. I know it makes no sense – I am good at my job, I am quick, I work hard – but I feel like my inner critic haggles my hardworking self down. It’s a form of self-sabotage that I can’t financially afford to keep doing,” she admits.

Meanwhile, pressure can come from clients or recruiters to work for less.

Content strategist Gemma Moore said she has been told by male recruitment agents to cut her day rate by up to £200 to remain competitive. “I never do and I’m never without work because of it. I see it regularly from the other side when I’m hiring that women do tend to set their rates a lot lower for comparable levels of experience, maybe due to the pressure put on them by recruiters or maybe due to lack of confidence.”

The pressure to be competitive is felt strongly by people who are new to working for themselves, and this can be a major factor holding down earning power. Zuhura Plummer has been a self-employed graphic recorder for two years. Her more experienced competitors can charge up to £1,000 a day, but she aims to charge £350-£450 a day, which she knows is cheap.

“The reasons are ‘I’m not as good as her’, confidence issues. Imposter syndrome basically, because my drawing isn’t as beautiful as someone else’s,” she says.

“And when you’re starting out, you want the job so much, you don’t have a full diary and you don’t know work is definitely around the corner.

“I do know I should be charging more. People have shadows around money, complicated views around value and what they’re worth. I think it goes to the very core of how you think about yourself. There’s the idea that if I’m not doing this to the absolute best I could be doing it, then I shouldn’t be charging, even if they’re willing to pay for it.”

Women’s work

In the past, the gender pay gap was explained by differences in background and educational attainment between men and women. But now a much more significant factor is that the responsibilities of caring for children and elderly relatives still typically fall to women. For employed women, this might mean career gaps, and a salary that never catches up to colleagues once they return to work. For self-employed women, it might mean taking on poorly paid gigs which can be done around family commitments.

There is also a mystery factor behind the gender pay gap which academics can’t explain. Dr Malcolm Bryning of the University of Essex recently published a report into the causes of the UK’s gender pay gap. “Women have career gaps and some of that is perhaps a ‘legitimate’ cause for a pay gap, but there is always a residual which is not explained, and that is often imputed as discrimination,” he said.

He pointed to the theory of occupational segregation, in which ‘feminised’ occupations pay less. The top three occupations for self-employed women are cleaners, childminders, and hairdressers, official data shows. Both men and women within occupations like these experience lower pay, but women are disproportionately affected because they outnumber men.

It is not clear why average pay is lower in jobs that women do, it’s almost a chicken and egg scenario – is it that women are paid less, and when they segregate into certain jobs, this brings down average pay in those jobs? Or is it that family and social pressures cause women to enter into low-paid occupations as a second-best option?

Dr Bryning’s report points to something called undervaluation theory, which suggests that “society undervalues certain types of work precisely because women do it”.

The other side of the coin is that women are less likely to secure the highest paying jobs – as a FTSE 100 CEO, it is more likely that your name is David than that you are a woman, said a report by the High Pay Centre.

The highest paying freelance roles are also somehow closed off to women, suggested Dr Bryning. “Women are generally entering freelance type occupations that are very different from those that men enter. You need to get in to those types of jobs which pay better, and women don’t, whether it’s for traditional reasons, historical reasons, or some sort of occupational closure.”

The gig economy

The ‘casualisation’ of work in the UK and the rise of the gig economy has been especially detrimental to women. Around 58% of people on zero hours contracts are women, according to the ONS. The sectors most likely to employ workers on zero hours contracts are health and social work, and accommodation and food – these are low paying, female dominated industries.

Zero hours workers work an average of 26 hours a week, and earn a lot less than permanent workers – £188 a week on average versus £479, TUC research shows.

It also found female agency workers earned £80 a week less on average than men in equivalent roles, while female temporary workers earn £60 a week less.

The confidence to ask for more

Shrinking the gender pay gap among the self-employed is not as simple as women asking for more money, it also requires clients to be willing to pay them what they are worth. But for women who are struggling to price their work properly, Corinne Mills of career coaching firm Personal Career Management offers this advice: “You have to be realistic about what is chargeable in your market, but also remember it’s not just about the price.

“It’s about the quality of the work, the relationship, whether you’re getting repeat business, but there’s no point not charging enough and feeling resentful and exploited.”

She adds that it’s important to demonstrate why the client should choose you rather than your cheaper rival, but that means you must believe your own pitch. “If clients are going to entrust you with that task, they have to believe you can deliver. If you say it confidently enough, you will get a chance to prove it.”