“We have not yet reached our goals of full gender equality and we are still tackling the gender-based wage gap, which is unacceptable in 2023.”
Tens of thousands of women in Iceland, including Prime Minister Katrín Jakobsdóttir, went on strike on Tuesday 24th October 2023 to protest the gender pay gap. The "kvennafrí", or women's day off, is Iceland’s first full-day women’s strike in 48 years.
“We have not yet reached our goals of full gender equality and we are still tackling the gender-based wage gap, which is unacceptable in 2023,” Jakobsdóttir told news website mbl.is. “We are still tackling gender-based violence, which has been a priority for my government to tackle.”
At least 25,000 women and non-binary people were at a rally in Reykjavík, with close to 40 organisations, including the Federation of the Public Workers Union, Iceland's largest association of public worker unions, joined the walkout.
Today, Iceland is the most gender-equal country in the world. However, it has 91.2 percent of its pay gap closed – not 100, which the strike is pushing for.
Closer to home, in the UK, it has been found that eight out of 10 companies pay men more than women. According to new research from the BBC, despite a continued push for equality, the wage difference is still 9.4%, the same level as in 2017/18, when companies were forced to publish figures.
Romi Savova, chief executive of pension provider PensionBee, said that the latest data was "bad news" and it was "pretty astounding" that the gender pay gap remained at the same level compared to five years ago.
Ms Savova told the BBC's Today programme that the "main culprit" for the difference was that major corporations were setting "unambitious targets" for getting women into senior positions.
"You can look around many rooms and still see that they are unequally filled and unequally represented," she said.
Banking and finance remain among the worst offenders, with women earning, on average, 22% less than their male colleagues, but it's not alone. The gender pay gap has continued to widen across many sectors, including education, where it has increased by 0.9 percentage points.
Large businesses that have some of the widest gaps in pay between men and women include EasyJet, Lloyds Bank division and Savills. At EasyJet, despite an improvement from last year, the average woman takes home just 53p for every £1 earned by men.
And this all comes after analysis back in February found that women work for free for nearly two months a year in comparison to men, according to the Trades Union Congress.
The organisation released the research on 23 February, also finding that the average gender pay gap for all employees stands at 14.9%, with the highest pay gap (20.8%) occurring for women between the ages of 50 and 59.
With International Women’s Day on the way and all of the related lip service and hypocrisy — perfectly highlighted by the viral Gender Pay Gap Bot Twitter account — fresh in our minds, how our gender affects our financial wellbeing is understandably front of mind for many of us. As the cost of living rises sharply, it’s vital that employers work to correct this inequality as quickly as possible, especially as the central pay gap issue is causing other gaps in women’s financial wellbeing and security. Here are a few of the ways that being paid less can ripple out into other areas of our financial lives — and what we can do to mitigate them:
Perhaps the most terrifying of all the gaps, the gender pension gap shows the compound effect of a woman earning consistently less over the course of her life, as well as taking time out for things like maternity leave and other caring responsibilities, or working part-time in order to accommodate childcare. According to Scottish Widows, the average 20 year old woman is on course to have £100,000 less in pension savings than the average man by the time she retires, while Now:Pensions’ comprehensive report into the same issue highlights how this gap is further exacerbated by other factors such as race, single parenthood and disability.
As part of this report, Now:Pensions have suggested some policy changes that would help to close the pension gap, including a family carer top-up for people taking time out of work or working part time to accommodate caring responsibilities, an increase in tax relief on pensions and the removal of the lower earnings limit on pensions, so that pension contributions are made on every pound earned. On an individual level, however, it’s vital that women are thinking about their pension and later-life financial security as early as possible, and contributing to a workplace or private pension as soon as they’re able to do so. Pensions should also be raised in any conversations about starting a family, as this is where women stand to lose out on huge chunks of pension savings.
Young people in general are finding it more and more difficult to keep their rent at a manageable level in proportion to their salaries, but this issue is even more pressing for young women. People spending more than 30% of their take-home pay on rent are considered ‘rent-burdened’, while those spending more than 50% are considered ‘severely rent-burdened’ and, according to SpareRoom, the proportion of women classified as ‘rent-burdened’ is a shocking 85% - 10% more than their male counterparts.
With rent taking up so much income per month, it’s often a struggle for women renting privately to put aside any money for savings, let alone to amass the huge deposit required to get a foot on the property ladder. This means that there is likely to also be a knock-on to home ownership for women, too.
With less disposable income to put aside for savings, women may not feel as able to invest their money for the long term. Investing in the stock market requires patience, and the ability to lock money away for an extended period of time in order to allow it to grow, but for many women, building an emergency fund or financial safety net in cash savings may be the priority.
However, in order for women to build wealth, it’s vital that we see investing as a legitimate option for us — because it is. A new generation of robo-advisers and investing platforms have made investing far more accessible, both in terms of the amount of capital you need to have (you can start from £1 on many platforms) and in terms of education and understanding how to invest. There is currently a £15bm gender investment gap in the UK, and if women are going to achieve economic parity, this needs to change! If you’re curious about investing, and have a little spare cash each month to put away, it’s worth researching different platforms. The earlier you invest - even just in tiny increments — the more time and opportunity your money has to grow.
At the root of many of the issues in women’s financial wellbeing is a gap in financial confidence. That’s not to say that this is women’s fault; it isn’t. Societal narratives around women and money have actively undermined our confidence for years — and just a few short decades ago, women weren’t even allowed to have their own bank account. Even now, according to Starling Bank’s Make Money Equal campaign, 73% of finance articles aimed at women are about spending less, whereas 90% of finance articles aimed at men are about growing wealth and investing. It’s hard to build confidence in a financial world where you are continuously patronised or dismissed.
Over the last few years, however, there has been a marked increase in women talking and writing about money, about investing, and about growing wealth. The louder that this noise gets, and the more women are supported in getting the education and confidence that they need to make positive decisions about their financial future, the better. There is nothing quite like feeling in control of your own financial future, even if there are a few gaps tha still need filling.
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