In the UK, it still pays to be privileged. Our research has yet again revealed a Class Pay Gap in workplaces across Britain.
Professionals from working-class backgrounds are being paid less than their more privileged peers in the same occupation, £6,291 – or 12% less – a year. This means that they effectively work 1 in 8 days for free.
Some pioneering employers are taking steps to change this. 18 employers who entered this year’s Social Mobility Employer Index are measuring their Class Pay Gaps and ten have published data publicly. They all recognise the positive impact that reducing class inequality can have on a company’s culture and, ultimately, its business performance. With support from five of these pioneering employers, we’ve created a guide to help others measure, report and close their Class Pay Gap.
These forward-thinking employers are in the minority. This is why we need politicians across the political spectrum to back mandatory socioeconomic reporting.The UK Government should commit to mandatory socioeconomic reporting for all employers with over 250 employees and other political parties should make this commitment in their manifestos too.
This year, our research shows that professional workers from working-class backgrounds are paid £6,291 – or 12% – less per year than those from professional-managerial backgrounds. That is despite them working in the same occupations.
*‘Class Pay Gap’ within group refers to the class differences in pay, such as between men from professional-managerial origins and men from working-class origins who are all working in Class 1 occupations.
Professional women from working-class backgrounds are hit with a double disadvantage. There is a Class Pay Gap of £7,042 between women from working-class and professional-managerial origins in the same occupation, as well as between male and female workers overall.
The Class Pay Gap varies considerably by ethnic group but some groups face an additional disadvantage due to their ethnic background as well as their class. The largest Class Pay Gap within an ethnic group is between White workers from a working-class background and those from a professional-managerial origin. Those from a working-class background are paid £6,464 less per year, despite being in the same occupation.
Workers in the private sector face a larger Class Pay Gap than those in other sectors. Those from working-class backgrounds in a professional occupation in the private sector are paid £7,575 less per year than those from professional-managerial origins. This is not good enough for a sector that collectively employs 82% of the UK’s workforce.
Workers in Northern Ireland face the largest Class Pay Gap, followed by Wales, The South & East of England, London and theNorth, who have Class Pay Gaps that range from £7,000 to £5,000. The lowest Class Pay Gaps are found in Scotland, at £3,503, and the Midlands, at £2,690.
The research, conducted for the Social Mobility Foundation, uses Labour Force Survey data from 2014-2022 (the July-September season). It sets out the latest Class Pay Gap figures and includes a breakdown by ethnicity, gender, profession and geographical region, building on previous research by the academics Professor Sam Friedman and Dr Daniel Laurison, who originally conceived of the Class Pay Gap.
The Social Mobility Foundation worked with leading academic Chris Percy to review the UK Class Pay Gap data from 2014 to 2022. To ensure its robustness the pay gap figure is an average across all the years we have data for. Class groups including “working-class” are based on household occupation aged 14, which is the metric recommended by the government’s Social Mobility Commission.
We know there is appetite among employers to report on socioeconomic background, despite it not yet being a statutory requirement.
Our guide, Levelling The Playing Field, provides a seven-step summary for organisations that want to collect and report on socioeconomic background data. The guidance follows established best practice in gender pay reporting and makes recommendations on how this can be applied to socioeconomic background. Our methodology is relevant for, and can be replicated within, organisations in the private, public or voluntary sector.
We’ve worked with the Bridge Group, Clifford Chance, Co-op, KPMG UK, PwC UK and Teach First to make this possible.