The Blog - Wind energy market analysis

Posted 08/03/2018

Ilaria Valtimora

    

How can renewable energy businesses close the gender pay gap?

For International Women's Day, Illaria Valtimora looks at the uncomfortable truths surrounding gender discrimination in renewable energy.

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Here’s a fact you might not like: the energy sector as a whole has traditionally had a systemic gender bias when it comes to hiring, and it is even more evident if we look at gender pay gaps. In the week of International Women’s Day, we can’t forget this.

We can argue that gender discrimination in renewables is less significant than in the wider energy industry. The International Renewable Energy Agency showed that women represent on average 35% of the workforce in 90 renewables firms that it surveyed last year. This is higher than the whole energy sector.

But we shouldn’t be satisfied with this, as more gender equality doesn’t always mean more pay equality. To gain more insights, we looked at the gender pay gap for firms active in renewable energy, which has been published by the UK government.

This year, all UK public and private sector organisations with 250 employees or more will have to report the difference between what they pay men and women. Over 1,300 firms have filed figures so far, and this is due to hit 9,000 by August. The data so far shows that around 75% of the companies in all sectors pay men more than women, and those working in renewables are no different.

Here are some examples: EDF Energy pays men 31.9% on average more than women; Innogy Renewables 22%; and SSE 22%. Consulting firms active in the sector don’t do much better: for example, Amec Foster Wheeler Environment & Infrastructure UK pays men 22% more than women; and Wood Group 16.6%. 

We'll come on to the reasons for this, but it's worth noting here that the data is simply showing overall pay gaps within companies and not that women are paid less than men for the same job.

And those splits are not unique to the UK.

For example, while the Trump administration recently suspended a rule in the US that would require firms to report gender pay gaps to the government, in the US women earn on average 20% less than men. For black and Hispanic women, the gap is even wider. Suspending a rule on reporting doesn't change the facts.

And there are well-established reasons why pay gaps exist.

The reasons may vary from company to company, but partly it is to do with the different roles held by men and women. Renewable energy firms may hire more women than those in the wider energy sector, but men are still more likely to take top roles, and hence earn more. High-paid jobs such as management roles or highly technical roles are also more likely to be held by men.

Another factor that affects the pay gap is when women become mothers. To analyse that we looked at the pay gap for part-time jobs. The Office for National Statistics’ figures for April 2017 show that, for part-time workers, the pay gap favours women, who now earn 5.1% more than men. This is not specifically related to the renewables, but still highlights some interesting trends.

The Institute for Fiscal Studies published a report last month that showed that part-time workers’ wages keep pace with average earnings growth in the economy, but they don’t move up pay scales. As women usually decide to work part-time for family and childcare reasons, the greater prevalence of part-time workers among mothers plays a large role in the overall gender pay gap.

The IFS showed that women on average spent seven more years in part-time work than men, which prevents many from keeping up with their career paths after their children are born. This means the gender pay gap usually opens up for mothers because of the difference in working patterns compared to their male colleagues 

What can be done? Well, flexible working can help, including in senior roles. Women with children are just as capable of doing their jobs and flexible working practices for women and men can help, to ensure that more women are supported.

It is incumbent on firms in every industry, including renewables, to see what they can do to take steps towards gender equality. And all year, not just the nice talk around International Women’s Day.

Interested in learning about the North American wind market? Download our free ebook, 5 Lessons in the North American Wind Business, by clicking below. 

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