The UK Gender Pay Gap 1997–2015: What Is the Role of the Public Sector?

• Author: Victoria Wass,Gerry Makepeace,Melanie Jones
• Date: 01 April 2018
• DOI: http://doi.org/10.1111/irel.12208
• Published date: 01 April 2018

The UK Gender Pay Gap 1997–2015: What Is

the Role of the Public Sector?

*

MELANIE JONES , GERRY MAKEPEACE and VICTORIA WASS

The Labour Force Survey is used to examine the influence of sector on the UK

gender pay gap 1997–2015. The assessment is twofold: first comparing gender

pay gaps within sectors and second through identifying the contribution of the

concentration of women in the public sector to the overall gender pay gap. The

long-term narrowing of the gender pay gap, which predominately reflects relative

improvements in women’s productivity-related characteristics, is found to stall in

2010 within each sector. This is considered in the context of claims that public

sector austerity represents a critical turning point in progress toward gender equal-

ity at work.

Introduction

The public sector plays an important role in shaping the employment oppor-

tunities of women relative to men across many Western industrialized econo-

mies (see Anghel, de la Rica, and Dolado 2011; Fulton 2011; Karamessini

2014; Rubery 2014). In the UK women are more than twice as likely to work

in the public sector as men and the relative concentration of women has

increased over a decade of public sector employment growth and during the

recession (Matthews 2010; Rubery and Rafferty 2013). Public sector pay pre-

mia are widely reported and these are found to be greater and more robust to

the inclusion of controls for personal and employment characteristics when

measured for women (Blackaby et al. 2012; Bozio and Disney 2011). This

female between-sector differential is reflected in a lower gender pay gap in the

public sector (Cai and Liu 2011; Chatterji, Mumford, and Smith 2011; Fuller

*The authors’affiliations are, respectively, Cardiff University, Cardiff, United Kingdom. E-mail:

JonesM116@cardiff.ac.uk; Cardiff University, Cardiff, United Kingdom. E-mail: Makepeace@cardiff.ac.uk;

and Cardiff University, Cardiff, United Kingdom. E-mail: Wass@cardiff.ac.uk. Material from the Quarterly

Labour Force Survey is Crown Copyright, has been made available from the Office for National Statistics

(ONS) through the UK Data Archive, and has been used by permission. This work was supported by the

Economic and Social Research Council (grant number ES/K003283/1). The authors are grateful for com-

ments from two anonymous referees, Phil Murphy, David Blackaby, Alan Felstead, and participants at the

WPEG conference 2014, University of Sheffield and the GWO conference 2014, University of Keele.

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296

2005; House of Commons Women and Equalities Committee 2016; Olsen

et al. 2010). For these reasons (a narrower gender pay differential and a rela-

tive employment concentration of women), it has been hypothesized that the

public sector has a narrowing influence on the headline UK gender pay gap

(Grimshaw 2000).

The flip side of a “protective”public sector for women is potentially a

greater vulnerability to fiscal austerity and the effects of downsizing and pay

restraint (Karamessini and Rubery 2014; Rubery and Rafferty 2013). Adverse

relative employment and wage effects have been observed in countries that

began to “rebalance”their public sectors earlier (Canada [Fuller 2005] and Ire-

land, Latvia, Romania, and Spain [Fulton 2011]). For the UK, the United

States (Albelda 2014), and most European countries (Bettio and Verashchagina

2014), early findings did not support a disproportionate female impact. Rather,

gender pay gaps continued to narrow (Bettio et al. 2013) and this may have

lessened interest in questions of gender inequality. However, for many coun-

tries, fiscal austerity continues so that conclusions drawn from early findings

must be treated as provisional (Rubery and Rafferty 2013). It is significant that

longer term predictions were less dismissive (see Equality and Human Rights

Commission 2012; Grimshaw, Rubery, and Marino 2012; Rubery 2014;

Women’s Budget Group 2012) with Karamessini (2014) proposing a “critical

turning point,”Rubery (2014) a “critical juncture,”and Walby (2015) a “tip-

ping point.”

This study examines the influence of public sector employment on the gen-

der pay gap in the UK and seeks to uncover the mechanisms underlying this

impact: whether through a lower gender wage gap within the public sector

and/or through a relative concentration of women in more highly paid public

sector jobs. We use decomposition techniques (OB, developed by Oaxaca

[1973] and Blinder [1973]) to identify the part of within-sector pay gaps due

to differences in observed characteristics, or what is explained, from an unex-

plained component that is taken to reflect inequality in treatment. This

approach is extended by including a modification of the Brown, Moon, and

Zoloth (1980) method (BMZ) to consider the contribution of women’s dispro-

portionate representation in public sector employment. Further, by performing

the analysis over a decade of absolute and relative growth in the public sector

(1997–2009), followed by five years of austerity from 2010, it is possible to

monitor change in the gender pay gap within and across sectors. The timing of

this sectoral study is propitious: it provides an early empirical evaluation of

the proposition that the dismantling of the public sector potentially represents

a new and regressive trend in the historical development of gender equality at

The UK Gender Pay Gap 1997–2015 / 297