With the first annual reporting window having closed on 4 April 2018, we look at how the life sciences sector has fared in the first year of mandatory gender pay gap reporting.
Since 6 April 2017, employers in the UK with 250 or more employees have been required to begin publishing figures on their own website and a dedicated government website showing the pay gap between their male and female employees. Employers must publish averages in terms of both hourly pay and bonuses for men and women in their organisation. They must also show what proportion of male and female employees receive a bonus, and how many men and women are in each quartile of the organisation’s pay structure.
The gender pay statistics for the life sciences sector should be considered against the broader backdrop of the efforts by successive governments to encourage more girls to study, and then pursue a career in, STEM subjects (science, technology, engineering and maths). The latest figures reveal that women make up only 14.4% of those working in the STEM sector, despite making up roughly half of the UK workforce.
So what do the gender pay gap figures show? In summary, there is still work to do.
The published figures for employers within the life sciences sector were always going to make for interesting reading. The life sciences sector has frequently been criticised for not doing enough to recruit and retain female talent, with the sector being placed under the (proverbial) microscope. In 2016, a report by Korn Ferry Hay showed that life sciences had one of the largest pay gaps in UK industry alongside the energy and technology sectors. Research in 2017 by the New Scientist meanwhile revealed that women working in science and engineering in the UK earnt a fifth less than their male colleagues.
In the pharmaceutical industry, there is a large variation between companies and some appear to be bucking the trend. MSD (the UK subsidiary of Merck) reported that it had a gender pay gap in favour of women of 6.7%. Novartis UK reported a similar situation with a gender pay gap across its four UK companies of 12.4% in favour of women. However, the published figures for its pharmaceutical and manufacturing arms show a pay gap of 8.6% and 14.3% respectively, in favour of men. The anomaly arose because of the number of men in some of the lower paid, male – dominated skilled areas. This demonstrates how the gender pay gap figures are very much a blunt tool and can often be misleading.
Meanwhile Allergan and Bayer, for example, have more typical gender pay gaps of 15% and 19% in favour of men, respectively. Bayer, in its accompanying report on its figures, stated that "the principal reason for our pay gap is that we have significantly more female employees in our lower job levels and slightly more male employees in our higher level job roles." This is perhaps the biggest takeaway from the first year of gender pay reporting across all sectors – women are consistently underrepresented in the top tiers of UK companies in what some have called a "gender seniority gap." It is this disparity in the types of jobs carried out by men and women that then drives the gender pay gap.
Whilst not necessarily revealing pay discrimination in the life sciences sector, these set of figures bring into sharp focus the need for the sector to take steps to address the gender imbalances in their workforce. This includes both encouraging a greater number of women to progress to higher paid roles, whether in management or research, as well taking action in the lowest pay quartile – how can, for example, companies encourage more women into distribution and manufacturing, and more men into secretarial and support roles?
With a requirement to report figures annually, the Regulations will ensure that this issue continues to attract public and political attention. Deloitte recently reported that, without action, the UK's gender pay gap will not close until 2069. The efforts required by the life sciences sector to close its pay gap will not necessarily be easy or quick, and will have to involve changes in culture and behaviour. A joined up approach with Government may also be required on issues such as shared parental leave, which remains underutilised partly because of the current complexity of the law.
If the figures on gender pay, however, are to move beyond simply a set of headlines every April, such work would appear vital to the future success of the life sciences sector.