Analysis by the London School of Economics reveals that in the U.K., women are four times less likely than men to be part of the top 1% of earners in financial and professional services. Despite efforts to bridge the gender pay gap and promote career advancement, the gap has actually widened slightly since before the pandemic.
In brief
Women hold 19.4% of the top 1% highest finance and professional services positions, a slight decrease from the pre-Covid average of 19.7% over three years. However, women’s representation in the top 10% of roles has increased to 28.3%, showing signs of progress with a 2.5 percentage point rise over the period.
Using the U.K.’s Quarterly Labour Force Survey from January 2017 to June 2023, the LSE analysis also indicates a shift in seniority balance, with women now making up 37% of senior managers and directors in professional services and finance, similar to the percentage of female full-time employees.
Why hasn’t gender equality improved more?
The persistent gender seniority gap, particularly as one climbs the career ladder, suggests that corporate efforts to address it have not been sufficient. Factors contributing to this gap include penalties for mothers in their careers, bias (both blatant and unconscious), and broader societal issues such as unequal distribution of household responsibilities.
The COVID-19 pandemic may have hindered progress in gender equality, as women were disproportionately affected by layoffs and businesses tended to cut funding for diversity, equity, and inclusion programs during tough times. Additionally, there has been a conservative pushback against affirmative action in the U.S.
Dr. Grace Lordan, from The Inclusion Initiative at LSE, emphasizes the need for recognizing diversity as beneficial for business and investing in upskilling managers to lead inclusive teams to drive progress in gender equality.
While hybrid working was expected to benefit working mothers, evidence suggests that remote workers may face career disadvantages compared to those in the office. Return-to-office orders have also impacted mothers’ ability to remain in the workforce.
What’s next?
The trend towards more equal gender representation in mid-senior roles and among the top 10% of earners in sectors like finance and professional services is promising. This could potentially lead to more women in senior and well-paid positions in the future, given the increasing experience levels among women.
However, the challenge remains as women’s advancement opportunities decline with each level of seniority. Until this dynamic changes, the gender gap will persist significantly.
