Class Pay Gap Day: working class Brits working for free

• November 14^th marks National Class Pay Gap Day – the day working-class employees effectively stop being paid (highlighting a 13% pay gap of £6,718)
• Working-class women are paid £9,450 less than their male colleagues, even when they are both working in the same role
• The Social Mobility Foundation calls on government to launch a consultation on creating a register for class pay gap reporting

New research produced by the Social Mobility Foundation highlights that the UK has a class pay gap of £6,718 or 13.05%. This means that Monday 14^th November marks the day in the year when those from working-class backgrounds working in higher professional-managerial positions, cease earning, relative to their peers. It also means that they effectively work for nearly one day in every seven, for free.

The analysis looked at pay data between 2014-2021 across 15 ‘elite’ occupations. It focused not only on class pay gaps, but the intersection of class, gender, and race, to understand those who most acutely feel the impact of the ‘double disadvantage’.

Gender and race increase the class pay gap

The research found that those from a working-class background face a ‘double disadvantage’ when gender, ethnic and sectoral differences are taken into consideration. Working-class women are paid £9,450 less than their male colleagues, even when they are both working in higher professional-managerial positions. The study also found that people who are of Bangladeshi and Black Caribbean heritage are paid £10,432 and £8,770 less respectively than their White peers in the same jobs.

London and Northern Ireland see the worst class pay gap across the UK

Regional differences in class gaps show that Northern Ireland and London experience the biggest pay gaps, compared to those in the Midlands and Scotland who have a much smaller gap. In fact, the data shows us that working-class employees in Northern Ireland are almost three times worse-off than those in Scotland.

Breaking the data down per job occupation

There are pronounced differences among ‘elite’ groupings of occupations. CEOs, who earn the most money, had a class pay gap of £16,749 per annum between those from professional-managerial and working-class origins. They were followed by Finance Managers (with a class pay gap of £11,427), Management Consultants (£8,863), Solicitors (£8,115) and Accountants (£6,261).

In contrast, scientists, life science professionals, social worker/welfare professionals, engineers, journalists, and academics are paid less on average and show much smaller class pay gaps. Scientists from working-class origins did not suffer any ‘class penalty’ at all, therefore bucking the trend. If anything, a ‘class premium’ was found, with scientists from working-class backgrounds and working in top-level (NSSEC 1) positions making £4,600 more than their colleagues from professional-managerial backgrounds.

Sarah Atkinson, CEO, Social Mobility Foundation said:

“In Britain, it still – quite literally – pays to be privileged, the existence of a class pay gap shows that Britain remains a deeply unequal society; people from working-class backgrounds not only face barriers getting into the professions but also barriers to getting on.

“Far too often employers value polish over performance and it is only by collecting socioeconomic data that they can ensure they are rewarding performance.

“The cost-of-living crisis and the pandemic will be a hammer blow to social mobility. We urge the Government to demonstrate decisive leadership by launching a consultation on creating a register for class pay gap reporting – which was also the first step for Gender Pay Gap reporting.”

“As an absolute starting point, employers must collect socioeconomic data on their staff to assess the problem. Then they can get serious about solutions.”

Professor Sam Friedman, Professor of Sociology, London School Economics said:

“Those from professional-managerial origins working in the most prestigious jobs – such as doctors, solicitors, and management consultants – are paid over £51,000 a year, but those from working-class origins in the same jobs are paid less than £45,000 per year, highlighting a pay disparity of £6,718. This represents a grossly unfair class pay gap. It’s time for the government to act and finally make class a protected characteristic.”

Kevin Ellis, Chair, and Senior Partner, PwC, said:

“Improving access to opportunity and working towards a society where a person’s career is based on their potential and not their background is a top priority for PwC, and for me personally. We have more work to do, but by publishing our socio-economic pay gap data, we can hold ourselves to account, identify problem areas and take the right action. 

“We know that our pay gap exists due to under-representation of minority groups at senior levels. Improving representation is key, and we have a comprehensive action plan, covering recruitment, development and progression, community work and advocacy. Publishing our pay gap data is part of our advocacy work and hopefully makes it easier for other organisations to do the same.”

Carlos Conceicao, Partner, Clifford Chance said:

“We’re proud to have taken steps towards more transparency on social inclusion in the firm. This is the first year we’ve reported our socio-economic data and believe it’s a critical component of our inclusion efforts. There is work to be done, but we will continue to strive towards creating an environment where everyone, regardless of background, has an equal opportunity to succeed.”

Calling for change

While we’ve seen some organisations report on their class pay data, class pay gap reporting is by no means on businesses agenda for the most part.

As such, The Social Mobility Foundation calls on government to launch a consultation on creating a register for class pay gap reporting: for organisations to engage in the consultation and support the cause for government action on this issue. 

“To initiate positive change and end class pay gap disparity, we need greater transparency, more drive for the change required, and action to make it happen now. We need organisations and government to recognise this and commit to creating a more equal, equitable and inclusive society that doesn’t penalise those from working-class backgrounds but that truly levels the playing field,” concludes Sarah Atkinson, CEO, Social Mobility Foundation