The Labour Market and Annual Survey of Hours and Earnings - Term Paper Example

The Labour Market (ASHE) Report Introduction The fall in gender pay gaps seen in most developed economies relates to the introduction of unfavourable legislation, increase in levels of education attainment among women, increase of women in modern professional jobs and with more options being made for both men and women internally and externally in the labour market (ASHE 2013, p. 5). Despite of these benefits, huge earning gaps have manifested in the UK and certain initiatives directed at the promotion of gender equality in this labour market does continue to be high on the policy aspect in such countries that can be considered to be developed. This report links to the Annual Survey of Hours and Earnings carried out by ONS. ASHE makes a provision of the information regarding to all the levels, trends and makeup of payments and paid hours for workers in all firms and positions of employment (Edwards 2003, p. 13). ASHE made a replacement of the New Earnings Survey from 2005. ASHE brought progress to the covering of worker’s imputation for product non-response and the weighing of earnings estimation. Summary of the Methods Used Aspect of coverage The ASHE makes a covering of employee tasks across the whole of Britain. The survey or research does cover workers from all firms and job groups, but does not make a covering of the self-employed or those serving the armed forces (Collins & Terry 2010, p. 19). The survey reference date is in May; hence the workers covered are only those who can be considered as active in that month, which can alter the numerals in some seasonal jobs. Design and sample frame The initial authentic sample can be obtained from the HMRC register in late February. However, the study reference table is dated in May. Consequently a second sample was taken from the HMRC register in May that can be utilized to know persons who have newly entered the workers list during those two periods duration. These persons can be divided between those in the May sample who have altered or shifted jobs since January, and those who never appeared on the January sample at all (Collins & Terry 2010, p. 22). The aspect of statistical disclosure Statistical disclosure does control method used in this survey. It can be applied to all outputs resulting from ASHE. This makes sure that information or data related to a person or private firms cannot be known easily in any publicized material (Perkins & White 2011, p. 14). The Code of practice for and certainly the Principle and Ethics on safeguarding confidentiality specifies the practices used in protecting information from being revealed to unknown parties. Data Presentation Pictorial chart Representing Workforce comprisal in the UK in2013 Source: Office of National Statistics Key points 1. The number of workers to nearest thousand, which can be adjusted with the seasons 2. The split occurs between whole and part time jobs based on respondents own categorization Table representing workforce comprisal in the UK in 2013                     Employees, thousands       Men % of total Women % of total All % of total     Whole-time 11,356 88.4 7,260 58.2 18,616 73.5     Part-time 1,489 11.6 5,214 41.8 6,704 26.5     All 12,845 100.0 12,475 100.0 25,320 100.0     Sourced from the labour force survey from national statistics (ASHE 2013, p. 18).     Key points to note         1. Number of workers to the nearest of thousand adjusted with season 2. The split between whole time and part time work based on respondents own categorization. Percentages will be rounded to one decimal point.       Average hourly payments exclusive of overtime The gender difference or what can be commonly referred to as the gender gap can be defined as the difference occurring between men’s and women’s payments as a percentage of the men’s payments. Scrutinizing the average hourly payments which are exclusive of overtime, there is a huge difference in the gap for whole time workers when related and a comparison made to part time workers (ASHE 2013, p. 19). Full time It can be observed that in April 2013, men’s average gross hourly payments increased by 2.5 per cent to 13.60 pounds, up from the year 2012. When comparing, women’s hourly payments rose by 1.9 per cent compared to the year 2012. The gender pay difference and gap for whole time workers, thus rose to 10 per cent from 9.5 per cent in 2012. Part time For part time workers, men’s average gross hourly payments had been 7.95 pounds in April 2013, rose up to 3 per cent in the year 2012. When comparing, women’s hourly payments were 8.40 pounds, a rise of 3.2 per cent from 8.14 pounds. The gender pay gap for part time workers was thus in the opposing direction to that of whole time workers, increasing to -5.71 per cent related to -5.51 per cent in 2012 (ASHE 2013, p. 21). All In April 2013, the gender earnings gap represented on average hourly earnings for all workers, both the whole time and the part time workers rose gradually to 19.7 per cent from 19.6 per cent in 2012 (ASHE 2013, p. 23). In April 2013 the gender pay gap based on average hourly earnings for all employees (full-time and part-time) increased slightly to 19.7% from 19.6% in 2012. A graph representing gender pay difference in average gross hourly payments, exclusive of overtime in the UK from April 2000 to 2013 Sourced from Annual survey of hours and Earnings office (ASHE 2013, p.28). Key points 1. Workers on adult rates earnings not affected by their absenteeism 2. Whole time defined as workers working more than 30 hours every week, which must be paid, or 25 and more for the teaching career. 3. Figures show the difference between men/s and women hourly payments as a percentage of men’s payments. 4. Dashed lines signify discontinuities in the years 2004, 2006 and 2011 as estimated by ASHE. 5. Data in 2013 can be taken to be provisional Table representing average gross hourly payments exclusive of overtime with gender pay gaps in the UK in April 2012 and 2013     Men Women Pay gap %           April 2012 Full-time 13.27 12.01 9.5             Part-time 7.72 8.14 -5.5             All 12.50 10.05 19.6           April 2013 Full-time 13.60 12.24 10.0             Part-time 7.95 8.40 -5.7             All 12.86 10.33 19.7           Sourced from Annual Survey of Hours and Earnings office (ASHE 2013, p.34).         Key points 1. Workers on adult rates earnings not affected by their absenteeism 2. Whole time defined as workers working more than 30 hours every week which must be paid, or 25 and more for the teaching career. 3. Figures show the difference between men/s and women hourly payments as a percentage of men’s payments. 4. Dashed lines signify discontinuities in the years 2004, 2006 and 2011 as estimated by ASHE. 5. Data in 2013 can be taken to be provisional Payments can be rounded off to decimal points, whereas percentages can be rounded off to one decimal point.                   Mean hourly earnings (excluding overtime) Average hourly payments which are exclusive of overtime Although ONS’s headline estimation of gender earnings gap can be based solely on average hourly payments which is exclusive of overtime, average hourly payments differences can be a vital extra measure (White & Druker 2009, p.27). The average measure of payments tends to be greater than the mean because it can be skewed by the essentially small number of workers at the top end of the pattern or its trend with certain high payments. Full time Men’s average hourly payments which is exclusive of overtime was 16.91 in April 2013, rose up to 2.3 percent from 16.52 pounds in 2012. Women’s average hourly payments rose by 1.3 per cent to 14.25 pounds when related to 14.07 pounds in 2012 (White & Druker 2009, p. 31). This implies that the gender gap difference for whole time employees rose to 15.7 per cent from 14.8 per cent in 2012. Part time For part time workers, men’s average hourly payments exclusive of overtime was 11.73 pounds, rising from 11.58 pounds in 2012, compared with women’s payments of 11.12 pounds from 10.79 pounds. The gender earnings gap for part time workers therefore declined to 5.2 per cent from the initial level of 6.9 per cent in 2012 (White & Druker 2009, p. 43). It is worth to note that the earnings difference in average payments is in the opposing direction to that for average payments. The motive by ASHE 2013’s provisional outcomes for this is that there happens to be a huge number of men compared to women who work part time with greater payments, which skews the distribution and heightens the average mean in relation to the mean of the distribution. All The gender earnings gap based on the average for all workers did rise to 19.1 per cent in 2013 from 18.6 per cent in 2012 (ASHE 2013, p. 45). Table representing the average gross hourly payments exclusive of overtime with gender earnings gap in the UK in April 2012 and 2013.         £ per hour         Men Women Pay gap %     April 2012 Full-time 16.52 14.07 14.8       Part-time 11.58 10.79 6.9       All 16.20 13.19 18.6     April 2013 Full-time 16.91 14.25 15.7       Part-time 11.73 11.12 5.2       All 16.58 13.42 19.1     Sourced from ASHE in the office of national statistics (ASHE 2013, p. 49).   Key points 1. Workers on adult rates earnings not affected by their absenteeism 2. Whole time defined as workers working more than 30 hours every week, which must be paid, or 25 and more for the teaching career. 3. Figures show the difference between men/s and women hourly payments as a percentage of men’s payments. 4. Dashed lines signify discontinuities in the years 2004, 2006 and 2011 as estimated by ASHE. 5. Data in 2013 can be taken to be provisional Payments can be rounded off to decimal points, whereas percentages can be rounded off to one decimal point. The aspect of age The table above shows median gender earnings gap by age group based on the whole time hourly payments exclusive of overtime. The gender earnings gap is certainly small in age groups up to and inclusive of the 30 to 39 age group without including the 16 to 17 age group, but is nonetheless huge thereafter. This is likely to be linked with the aspect that many women have children and the time used out of the labour market, fused with the career options they make owing to this, can affect their amount of payments thereafter (Williams & Adam 2010, p.53). Interpretation and critical analysis Relevant theories to explain above data presentation on gender difference gap The Neoclassical Earnings Determination Theory Labour’s price is dependent on its scarce nature and wages can be determined by personal productiveness, in the labour market, wages will be an optimal price determined by the automatic forces of demand and supply. When supply collides with demands, workers will have to offer their working services at that price and employees will have to accept that at the specific value of marginal productivity of labour (Corby et al 2009, p. 67). In the long run, wages will depend on the forces of supply and demand despite of the short run changes. Labour can be taken and looked at as a product, whose price can be established by the labour market externally. The labour market carries out the regulation of the employment relationship (self-regulation) where employees make a rational choice. Both employees and employers have perfect information to maximise utilising their interests, with supply and demand across the labour market tending to be stable over time. Employers paying above market wages will be forced to reduce labour costs (wages or employment). In a free market wages are determined by the interaction of supply and demand for labour. Hence, gender gap earning differences is hence critical in relation to this theory. This theory serves as a basis to explain why such differences in earnings emanate from (James 1998, p. 45). Human Capital Theory Human capital theory: ‘Individuals accumulate human capital by investing time and money in education, training, experiences and other qualities, to increase their productive capacity and thus worth to an employer. People have the choice of interesting in themselves by securing an appropriate education, training and work experience. A relatively low supply of people investing in skills and knowledge can secure higher wages because the relatively low rate of competition for the relevant jobs. Hence, this explains the aspect of gender gap in the earnings, and more specifically to women who are mostly affected (Daniel 1976, p. 92). The gender earnings gap interpretation The payments of relative to men differ and change in accordance to whether a worker works whole time or part time. ASHE estimations portray that average gross hourly payment which is exclusive of overtime of part time workers had been 35 per cent less than the payments of whole time workers in April 2013. At the same period, the Labour Force surveys which in short form can be abbreviated as LFS made an indication that the Britain’s workforce comprised of nearly 12.85 million men and 12.51 million women. This entails 52 per cent of men in the workforce and 48 per cent of women in the workforce (Carter 2006, p. 98). The LFS also identifies that there is a crucial difference or gap in the segment of male and female workers who work the whole time and part time. For male workers, 87 percent worked whole time and 13 per cent worked part time in the year 2013. Moreover the comparable data for female workers was 57 per cent and 43 per cent respectively (Collins 1991, p. 52). This emphasizes the argument that more women work part time compared to men and even they are more prone to be awarded lower average hourly wage rates in their earnings. Conclusion Therefore, based on the discussed findings based on relevant applicable theories to gender gap difference regarding to earnings, it can be seen that the government needs to do something. This will affect and have disastrous implications to policy makers and to the employment relationship. If the UK does not revise such policies accordingly, then the country will ultimately start to experience economic implications (Marchington & Wilkinson 2005, p. 112). Women are the backbone of any society and so should be treated with dignity and utmost respect. References ASHE. 2013. Annual Survey of Hours and Earnings Office for National Statistics. Feb Publications. Carter, S. 2006. Employment Rights at Work: Survey of Employees 2005, Employment Relations Research Series No. 51, London: Department of Trade and Industry. Collins, H. 1991. Confederation of British Industry Room for Improvement: Absence and Labour Turnover 2004, London: Confederation of British Industry. Regulating Contracts. Oxford: Oxford University Press Colling and Terry. 2010. Pay and Working Time, London: Acas. Corby, W., Deakin, S., & Hudson, M.P. 2009. Pay Equity, Gender and Age, London: Department of Trade and Industry. Daniel, W.W. 1976. Wage Determination in Industry, London: PEP. Edwards, G. 2003. Management of Pay. London: Sage. James, W. 1998. Fairness at Work, Cm 3968, London: HMSO. Marchington and Willkinson. 2005. ‘Equity and Fairness in Reward Management’. Human Relations. Perkins and White. 2011. “Conceptual and Theoretical Framework.” White and Druker. 2009. “Determining Pay” Williams and Adam-Smith. 2010. The Changing Contours of British Industrial Relations: A Survey of Manufacturing Industry, Oxford: Basil Blackwell. Read More