Gender pay gap among UK employees narrows to 9.6%

The pay gap between men and women in the UK is narrowing, official figures showed today.

Based on earnings in April 2012, the difference between hourly pay rates for men and women in full-time work decreased to 9.6%, from 10.5% in 2011. This continues a general downward trend in the pay gap in recent years, the Office for National Statistics (ONS) said.

Median gross weekly earnings for full-time employees in April 2012 amounted to GBP506, a rise of 1.5% from GBP498 in 2011. Dividing the pay figures on gender lines we can see that full-time earnings for men were GBP546, up 1.4%, compared with GBP449 for women, an increase of 1.9%.

Among part-time employees, women are better paid than men although their earnings are considerably below those of their full-time counterparts. Female part-time workers earned an average of GBP158 per week in April 2012 and men GBP146.

Brendan Barber, general secretary of the UK’s national trade union centre, the TUC, said that the pay gap between full-time and part-time workers is getting wider.

“This is terrible news for the millions of people who need to work part-time to balance work and caring responsibilities, or who simply can’t find full-time jobs,” he added.

As part of its annual survey of hours and earnings, the ONS also examined differences in pay by sector, pay scale and region.

There was little difference in the year-on-year rise in pay between the public and the private sector. Full-time public sector workers saw a rise in weekly earnings of 1.6% to GBP565 this year, while in the private sector the increase was 1.5% to GBP479. The ONS pointed out, however, that the difference in pay levels results from the fact that there are more low-paid jobs in the private sector and a larger proportion of graduate-level and professional occupations in the public sector.

Those at the top of the pay scales actually saw a decrease in their pay between 2011 and 2012. The hourly earnings excluding overtime of the highest paid full-time employees fell by 0.2%, while the lowest paid employees saw an increase of 2.3%.

Perhaps not surprisingly, median gross weekly earnings for full-time employees in April 2012 were highest in London, at GBP653. Employees in Wales had the lowest median earnings, at GBP453.

UK house prices rise three times the rate of wage inflation

House prices in the UK have continued to stretch further away from the reach of millions of workers, a new study confirmed today.

Research from the National Housing Federation shows that house prices have risen three times as much as average incomes over the last ten years.

In 2001 the average price of a home stood at GBP121,769 and the average salary was GBP16,557. A decade later the price of a home had shot up 94% to GBP236,518, while wages rose just 29% to GBP21,330. The result is that buying a home has become increasingly unaffordable for many people.

To make matters worse, saving for a mortgage has become harder as the amount of deposit needed to get a mortgage has risen by 386%. In 2001 the deposit for a typical 90% mortgage was GBP12,177, corresponding to about nine months’ salary. By 2011, after the financial crisis, banks were generally less willing to lend 90% of the price and the the deposit needed for a typical 75% mortgage had ballooned to GBP59,129, almost three years’ salary.

At the same time the cost of renting has increased, a letting group said today. LSL Property Services plc, which owns a letting agent network that includes national chains Your Move and Reeds Rains, reported that the average rent paid by private tenants in England and Wales had reached a new record high of GBP725 a month in July.

Average rents rose by 1% compared to June and were 2.9% higher than a year ago, fuelled by strong demand for rented accommodation due to the growing number of people unable to get a mortgage.

Housing charity Shelter has called for government action to increase house building in order to address the housing crisis, after official figures released yesterday revealed a 24% decrease in the number of new homes started. Only 21,540 new homes were started by builders in the three months to June 2012, down 24% from the same period a year ago and a 10% decrease from the first three months of the year.

Shelter’s chief executive Campbell Robb said: “With a flatlining construction sector, building significant numbers of new, genuinely affordable homes would create jobs and stimulate the economy. More importantly, it would send a clear message to the millions of people priced out of homeownership or struggling with high housing costs that the government is on their side.”