Pay gap between men and women 'likely to widen'

THE GAP between men's and women's wages will go from bad to worse without more intervention in the labour market, the Equal Opportunities Commission says in a report published today.

Employment trends over the past 10 years point to a worsening of conditions for women in decentralised, fragmented, and local pay bargaining.

The recent spread of performance-related pay systems is also expected to disadvantage women as research shows they are less likely to benefit from such reviews as they are based on male assessment criteria.

June Bridgeman, deputy chair of the EOC, said the benefits of increasing the value of women's work would provide substantial economic benefits in helping to eliminate poverty and the waste of skilled labour. 'There must be a better way than the law of the jungle, or the jungle of the law, to tackle women's disadvantage when it comes to getting a fair rate for the job,' she said.

Research into the economics of equal value showed that job segregation between 'men's' work and 'women's' work remained one of the biggest causes of average female pay being about 70 per cent that of males.

Dr Jill Rubery, of the Universtiy of Manchester's school of management, who carried out the study, said much of the division was specific to an individual company so that, for example, clerical work was done by women and maintenance and production jobs by men. Tradition, custom and practice were also factors. Ford's Bridgend factory in South Wales has only about 20 female employees out of a workforce of 1,600 while in Dagenham, east London, there is a far greater proportion of women on the production line.

Because women are concentrated in low-paid jobs, they are vulnerable to the worst effects of the market. The EOC is fighting North Yorkshire County Council over a group of canteen workers who had won a regrading exercise to increase their pay only for the jobs to be then subjected to competitive tendering, which saw a cut in rates to enable the in-house bid to resist outside bidders paying lower wages.

Dr Rubery said such fragmentation of national bargaining systems had led to women becoming worse off. Previously, centralised systems could impose effective skills comparisons on the market.

Performance-related pay, on the other hand, worked in a different direction and was at the discretion of senior managers. A report on performance pay, commissioned by the EOC is to be published later this month.

'It goes against the principle that reward should be related to the value of the job, but emphasises individual productivity and performance,' she said.

The research accepted that there would be an initial cost to employers of raising women's relative wages. A 10 per cent rise in women's earnings would result in a 3.1 per cent increase in the total wage bill. Such relative wage shifts are not uncommon and Dr Rubery said that the consistent rise in male non-manual wages during the 1980s had led to a national pay bill increase of about 4 per cent.

The Economics of Equal Value, by Dr Jill Rubery is published by the Equal Opportunites Commission; pounds 3.