Across the European tech sector, a noticeable difference exists in pay between men and women, showing a median gender pay gap of 26%. This translates to women earning, on average, 26% less than their male colleagues.
Digging deeper into the numbers, it’s clear that the gender wage disparity varies by country. Some areas face a bigger disparity, while others show indications of recovery. Based on the Ravio compensation report, the UK has the highest rate of 29%, Germany follows with 25%, the Netherlands has 23%, and France has an 18% gender pay gap.
Why does the gender pay gap exist in the tech sector?
According to research from Figures and 50inTech, for every woman occupying a high-level position, there are six men in comparable positions. That is an enormous rationale for the pay disparity in and of itself.
One main reason for this pay disparity is that many European women may be ignorant of their own worth. The same research showed that 60% of employees at technology startups are unaware of their market value. Presently, this ignorance is more prevalent among women.
When women in the tech sector do not understand their worth, it becomes easy to get an unequal remuneration package, notwithstanding their ambiguity about their worth.
Over 32% of persons in mid-level employment say their pay is at least 20% below what it should be. It is rather problematic for technology businesses since it signals that future leaders and talented staff may be lost to other industries.
Salary negotiation is a challenging task that frequently confronts women. Approximately 36% consider it to be extremely distressing. A mere 7% of applicants will submit a job application if the salary is not disclosed in advance. 83 percent of those surveyed believe including salary information in employment proposals should be a top priority. Transparency is not the only consideration; boosting women’s confidence when discussing money during job interviews is also crucial.
Will the EU pay transparency directive impact the pay gap?
Beyond the gender pay gap, the Ravio report took a closer look at workforce composition within European tech companies and revealed a distinct gender distribution. On average, these companies maintain a workforce mix of 60% men and 40% women.
As one moves up the corporate hierarchy, the proportion of women decreases, highlighting the persistent gender disparity in leadership roles.
The upcoming implementation of the EU Pay Transparency Directive by 2026 marks a significant shift in the approach to gender pay equality. Surprisingly, 69% of surveyed people leaders do not consider it a pressing concern. For 45% of respondents, the perceived distant implementation date is a key factor, while 20% are already proactively addressing pay transparency and gender pay gap issues.
For companies expressing concern, the primary cause centres around making pay levels and career progression frameworks transparent and accessible to employees. In anticipation of the directive’s implementation, organisations are placing emphasis on improving communication, transparency, and compensation frameworks.
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