The class pay gap means that professionals from working-class backgrounds in the UK will not be paid for their work between today and the end of this year.
The Social Mobility Foundation commissioned a study that found working-class professionals earn an average of PS6,287 (or 12%) less than their more-privileged counterparts.
Class Pay Gap Day, the day when professionals from working class backgrounds stop receiving pay, falls on November 17 this year. The equivalent of eight days of work without pay is still worked by millions of people who come from working class backgrounds.
The Social Mobility Foundation urges the government to implement mandatory reporting of class pay gaps in order to unlock growth and remove barriers to entry into the workforce.
The draft Equality (Race and Disability) Bill announced earlier this year will require mandatory ethnicity and disabilities pay gap reporting.
According to the proposal of the Social Mobility Foundation, large employers will also be required by law to collect and report information on the socioeconomic backgrounds of their employees.
The Social Mobility Foundation 2024 Employer Index includes 26 organisations that have already measured their class pay gap, including Co-op as the first retailer and PwC.
In a study conducted in partnership with Co-op by the Social Mobility Foundation, it was found that women with working-class roots who are professional professionals face a double disadvantage. There is a Class Pay Gap of PS6,855 between women from working-class and professional-managerial origins in the same occupation.
The class gap in pay is more pronounced within the private sector which employs 82% currently of the UK’s workforce.
Professionals from working-class backgrounds in these roles are paid PS7,774 less annually than those from professional-managerial origins.
Three out of four respondents to a separate survey conducted by the Social Mobility Foundation believe that employers should be required to report their pay gaps.
Four out of ten young people with lower socioeconomic backgrounds reported feeling discriminated because of their class and background. Nearly half said that the pay gap had discouraged them from applying for jobs in “elite” professions like law and finance.
Sarah Atkinson is the CEO of Social Mobility Foundation. She said, “In 2024, it will still pay to be privileged. Even when people with working-class backgrounds enter professional occupations, their salaries are around PS6,000 lower than those of their more privileged peers. It’s not just unfair, but it’s also bad for business to fail to properly reward workers. Employers run the risk of missing out on talented people with different perspectives, which can lead to poorer decisions and lower productivity.
We’ve seen how gender pay gap reporting had a positive impact. We need to show the same level of commitment in addressing class barriers at work.
Claire Costello is the chief people and inclusion officer for Co-op. She said, “At Co-op we know that socioeconomic backgrounds still have a huge impact on pay, career progression and yet, it’s an issue that is often overlooked.” We are proud to have been the first retailer this year to release our socioeconomic gap. It gave us a clear picture of how we stood as a company and what we needed to improve on.
“It is the right thing to ensure that everyone succeeds, regardless of their background. It’s what we do for our community and our members.” We applaud the government for taking steps to activate the socioeconomic duty of the Equality Act. However, we urge them and other businesses to go even further by reporting socioeconomic pay gaps. “This is how we can create real and lasting change.”
The Social Mobility Foundation releases the Social Mobility Employer Index every year. This benchmarking tool ranks employers in Britain based on how they are promoting social mobility at work. PwC, a professional services firm, topped the rankings for the second consecutive year in 2024. It shared the top spot with the law firm Browne Jacobson.
Marco Amitrano is a senior partner at PwC UK. He said, “We know talent is everywhere but opportunity isn’t.” Many people are at an unfair disadvantage due to where they were born, where they attended school or what they did as a profession. It’s wrong, and we as the UK’s leading employer have a duty to act.
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PwC is proud to publish and measure the socioeconomic background wage gap. Data helps us focus our interventions, and holds us accountable. There is no quick fix. Supporting talent from all backgrounds and communities is key to driving economic growth. “At PwC, inclusion and responsible inclusive development are part of our daily conversation and ambition.”
