Employment Associate, David Sheppard, explores the headline today that earnings inequality among men has soared.
The Institute for Fiscal Studies has published a report today analysing the changing patterns of the UK workforce since 1994, which has revealed some fascinating developments. Some of the key findings were:
- In 1994, 1 in 20 men aged 25-55 with low hourly wages worked part time, being less than 30 hours per week. Today, 1 in 5 of this group work part time, representing a fourfold increase.
- The level of the middle and highest earning men aged 25-55 working part time hours has consistently remained below 1 in 20.
- In contrast, wage inequality amongst women has fallen since 1994. It was found that weekly earnings for the bottom 10% of female workers increased by 60%, whilst the top 10% increased by 29%
These findings suggest that in general, low pay work for men has moved from more traditional full-time and permanent positions such as within manufacturing, to less secure jobs in the retail, wholesale and hospitality sectors. It is also an indication of the growth of the gig economy in place of stable and regular employment, with the growth of zero hours contracts and self-employment.
This changing face of the UK’s workforce has recently been the subject of Employment Tribunal decisions regarding the legal status of Uber drivers and City Sprint couriers, which were both found to qualify for basic worker protections, such as paid holiday, a minimum wage and sick pay. 2017 will no doubt see further high profile judgments on the extent of protections provided to those within the gig economy, with ongoing litigation against Deliveroo, and Uber reported to be appealing against the finding its drivers were workers.
To underline the gig economy being high on the Government’s agenda, the Business, Energy and Industrial Strategy committee has called for evidence on how employment rights should apply in a changing working environment, and the Law Society has proposed this week that those employed within these sectors should be assumed to have worker status and enjoy basic workplace protections, unless the employer can demonstrate otherwise.
The number of men in low-paid part-time work has increased fourfold over the past 20 years. New research by the Institute for Fiscal Studies has found that one in five low-paid men aged 25 to 55 now work part-time. While 95% of top-earning men normally work full-time, 20% of the lowest paid now work part-time. That means wage inequality for men has risen over two decades, but for women the opposite is the case. More women have had a better education in recent years and more have moved into full-time jobs. As a result their pay has improved and they have had less incentive to leave the workforce.