Memorandum submitted by the Greater London
Authority
INTRODUCTION
1. The Mayor of London welcomes the opportunity
to comment on the report from the Women and Work Commission. In
February 2006 the Greater London Authority (GLA) submitted evidence
to the Trade and Industry Select Committee arising from our continuing
programme of work on women in London's economy. The GLA also sent
a copy of our 2005 report on Women in London's Economy to the
Women and Work Commission and held a meeting with representatives
of the Commission. This report memorandum summarises the initial
findings and further analysis of issues carried out since that
date and comments on some of the recommendations of the Women
and Work Commission.
2. We note that the Sub-Committee will examine,
in particular:
— the extent to which the suggestions
of the Women and Work Commission to address what the latter describes
as "the pay and opportunity gap", "meet the concerns
of those who gave evidence to the Committee in the last Parliament";
and
— what the Government and other
public bodies, employers and trade unions are doing to implement
the recommendations of the Women and Work Commission.
Our comments take this focus of examination
into account.
3. The Mayor's officers would be pleased
to give oral evidence to the Sub-Committee to elaborate on these
points and also to give an outline of action the GLA is taking
to address these issues itself. A copy of the most recent report
on Women in London's Economy, published in February 2006, and
its summary, accompany this submission.
ISSUES ON
WOMEN IN
LONDON'S
ECONOMY
4. Key findings of our 2005 report on Women
in London's Economy included:
— London's labour market is highly
divided by gender, with men and women broadly speaking working
in sectors of the economy and different jobs. The outcome of this
is not neutral, but rather reflect and entrench discrimination
with women tending to work in lower paid sectors. Women are over-represented
in health and social work by 68% and in education by 55%. In terms
of jobs, women are concentrated in administration and secretarial
roles by 62% and in sales and customer services by 40%.
— This occupational segregation
by gender makes a significant contribution to the gender pay gap
in London: the most common women's occupation in London pays £5.38
per hour but the most common man's job pays £17.30 per hour,
three times as much.
— The gender pay gap for women
working full-time in London is 25%, wider than the gap of 18%
in Great Britain as a whole.
— Women are under-represented
in management and senior occupations, and professional occupations,
in all sectors except education, health and social work: while
12% of women in London work in managerial and senior occupations,
21% of men do so.
— Even in sectors with a concentration
of women employees there are fewer women at top levels and women
remain under-represented at the top.
— Men dominate senior positions
in London's business sector—only 4.8% of executive directors
of FTSE 100 companies in London are women.
— Discrimination is not simply
a matter of occupational segregation—of men and women working
in different jobs and sectors, unequal though that may be—or
confined to specific grades or levels of employment: when women
make it into senior positions in sectors where they have been
unequally represented, their rewards are much lower than men's.
For example, the average total directors' remuneration for women
is less than half that of men's: for women it is £103,753,
while for men it is £233,047.
5. Further analysis in our 2006 report found
that:
— The gender pay gap is greater
in London than at UK level. Comparing mid-point (median) earnings
for women and men working full time, the gender pay gap is only
slightly higher in London than the UK—15% compared to 14%.
However, the average (mean) gender pay gap is 24% compared to
a UK figure of 18%. This reflects the gross under-representation
of women in highly paid jobs in London.
— The part time pay gap is greater
in London than in the rest of the UK. Median earnings show that
women working part time earned 51% of the full time rate for men,
compared to 57% in the rest of the UK.
— There has been an increase in
wage inequality for women in London over the last six years that
has not been seen in the UK as a whole.
— In 2004 the highest paid 10%
of male full time workers in London earned £36.66 an hour,
while the lowest paid 10% of female full time workers earned £6.78
an hour and the lowest paid 10% of female part time workers earned
a mere £4.85 an hour.
— Women's employment rates are
lower in London than in the rest of the UK: only 62% of women
in London are in work, but nearly 70% elsewhere. One significant
reason is the much lower proportion of women working part time
in London. For women with dependent children the barriers to part
time work are particularly high: 27% are in part time work in
London compared to 41% in the UK.
6. Qualitative research supported these
findings by showing that:
— Gender segregation and subject
choice in schools and colleges are intrinsically linked and that
young women are receiving inadequate careers advice. Women remain
a minority of entrants to A levels and degrees in many of the
subject areas that employers in the five growth sectors seek.
— Retaining skilled women workers
with caring demands requires an improved combination of flexible
working practices and affordable and flexible childcare.
— While no organisations said
that flexible working was harmful to productivity, there appeared
to be untested assumptions that these arrangements would not work
in certain jobs or sectors, and these needed to be subject to
scrutiny, such as through pilot schemes to evaluate the objectivity
or otherwise of such assumptions.
7. The report concluded that the new steps
needed include:
— A national macro-economic policy
that invests more in London—women are suffering particularly
badly from the fact that participation in work as a whole is lower
than in the rest of the UK and unemployment is also higher.
— Educational and training provision
that addresses gender segregation and equips women to have the
best chance for the most rewarding jobs. In London, this would
be aided by strategic direction by the Mayor of the Learning and
Skills Councils.
— Firmer measures on direct and
indirect discrimination and occupational segregation. More companies
need to base policy on better factual information, such as through
monitoring and reporting on the experience of women employees,
providing statistics on where women are located in their job and
pay structure, and thereby understanding and developing the business
case for equality.
— Childcare and other care provision
that is affordable, high quality and flexible. Government needs
to invest more to meet London's childcare needs and higher real
costs. Employers can help by supporting the extension of flexible
working policies much more thoroughly.
— A robust and modernised framework
of equality law with positive and comprehensive duties to equality
available to women in whatever sector they work, public or private,
greater rights to flexible working, more meaningful delivery mechanisms
such as through positive action, better access to justice and
enforcement such as through the possibility of representative,
or "class", actions, and a clearer duty on the public
sector to ensure equality standards when procuring services.
CURRENT GLA ACTION
8. The GLA and the London Development Agency
are currently seeking to engage with employers willing to share
methods of gender pay reviews and we are currently finalising
the issues for investigation for our 2007 Women in London's Economy
Report. These are likely to include further analysis of flexible
working practices, the impact of discrimination and lessons from
other international experiences in tackling inequality. We would
be pleased to share our plans and progress with the Sub-Committee
at a later date.
COMMENTS ON
THE WOMEN
AND WORK
COMMISSION REPORT,
"SHAPING A
FAIRER FUTURE"
9. The Mayor welcomes many of the recommendations
of the Women and Work Commission, although he considers some of
them too tentative. For instance, recommendation 37 says that
the "Discrimination Law Review should consider more fully
the issues of whether or not to extend the hypothetical comparator
to equal pay claims and of generic or representative equal pay
claims." The GLA considers it essential that the Discrimination
Law Review tackles entrenched inequality by seriously considering
the case for representative legal actions, rather than through
individual redress, as at present.
10. The Mayor also considers it essential
to provide rights to equality and equal pay for women wherever
they work, by developing a private gender duty to complement the
new public sector duty on gender. The Women and Work Commission
did not take this view and also did not support mandatory equal
pay reviews.
11. The Mayor considers that procurement
powers should be used to promote equality and that this measure
should be unequivocally included in the duty to promote equality.
The Women and Work Commission's recommendation (number 35) falls
short of making the use of procurement an absolute requirement
of the public sector duty, but seeks to encourage it and promote
good practice.
June 2006
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