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Gender pay gap impacting attraction and retention of talent

As gender pay gap progress continues to be slow, organisations are feeling the effects on their ability to attract and retain key talent, according to a report from Hays

Over a quarter (27%) of employers said they are aware of a gender pay gap in their organisation and that this negatively affecting staff attraction and retention.

The Hays Salary & Recruiting Trends 2020 guide found that, among employers who are aware of a gender pay gap, 59% said it is negatively affecting their ability to attract talent, and 61% said it is negatively impacting staff retention.

Employers in London were more likely to be aware of a gender pay gap in their organisation than those in other regions of the UK, with over a third (35%) saying they were aware of this.

Employers also cited facing challenges finding the right talent, with almost two-thirds (65%) saying they expect to encounter a shortage of suitable applicants when recruiting in 2020.

The research also looked at employees' views on the gender pay gap.

It found that almost one in five (19%) employees said they are aware of a gender pay gap within their organisation. Of these employees aware of a gap, 80% said it was an issue for them and almost a fifth (18%) said it is enough of an issue that they will leave their organisation or are considering leaving as a result.

Additionally, nearly three-quarters of employees (74%) said it was important that their organisation is transparent about how pay levels are set, yet two-fifths (41%) of employers say their organisation isn’t consistent with all employees about how salary rises are awarded.

Women are more likely than men to say they are aware of a gender pay gap at their organisation (22% compared to 16%). Of those who are aware of a gap, 87% of women consider it an issue compared to 70% of men.

The full time gender pay gap rose three percentage points to 8.9% in April 2019, according to the Office for National Statistics.

Simon Winfield, managing director of Hays UK & Ireland, said that employers can no longer afford to ignore the impact of the gender pay gap on their organisations: “Transparency around pay is clearly becoming important for professionals, many of whom also perceive there to be gender pay gaps, which is negatively impacting on the attraction and retention of staff.”

He added that employers should be transparent in their approach, and regularly assess how pay is awarded.

“Transparency can help to narrow pay gaps between genders, so put into action practical steps, such as having clear promotion and pay structures, as well as setting and publishing pay levels," he said.

“Assessing the pay needs of your team on an ongoing basis and being transparent about how pay levels and rises are set can help address salary requirements before it’s too late. Pay shouldn’t be the taboo subject it once was.”

The survey was conducted in Summer 2019 and received 31,598 responses. 11,047 of the respondents were employers and 20,551 were employees.