Equal pay isn’t at the heart of the finance industry’s gender gap

Dark days.
Dark days.
Image: Reuters/Toby Melville
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The financial industry has a woman problem. It used to be that there were simply not enough women working in the industry, and the women who got jobs were paid less than their male counterparts, even at the most junior levels. That hardly made the sector appealing to women.

While the industry has since made strides employing more women and equalizing pay for equivalent roles, a big gap remains in what a woman and a man earn on average. This is because there are simply not enough women being promoted to highly paid senior positions.

This has been laid bare in the UK, where the government requires all companies with more than 250 employees to publish statistics on their average wage and bonus levels by gender by April. Two of the country’s biggest banks, Barclays and RBS, reported on their gender pay gaps this week.

Yesterday, Barclays revealed a huge pay disparity (pdf) between men and women. Women earn 48% less than men, on average, at Barclays International, the unit that includes its investment banking division. The gap was smaller, but still plenty wide, at Barclays Services (25.8%), which is responsible for back-office services, and Barclays UK (26%), the group’s retail banking unit. “Although female representation is growing at Barclays, we still have high proportions of women in more junior, lower paid roles and high proportions of men in senior, highly paid roles,” said CEO Jes Staley.

Today, RBS reported that women make 37.2% less than men (pdf) at the bank. “In order to close the gender pay gap, we must continue to improve our gender balance in our most senior roles, and we are making good progress,” the bank said. It pledged to achieve full gender balance at all levels by 2030.

In November last year, the Bank of England flagged the same problem and pledged to focus on improving its numbers. It reported the smallest gap of the big financial institutions to report thus far, but at 21% that’s hardly something to celebrate.

This story is part of How We’ll Win, a project exploring the fight for gender equality at work. Read more stories here.