WOMEN REACH 'PEAK EARNINGS' 4 YEARS EARLIER THAN MEN
Posted on 14th April 2021
Totaljobs has launched a new tool, the Peak Earnings Predictor. Built with Totaljobs' exclusive salary data, it enables people to benchmark their earnings and find out their potential peak salaries and at what age they could achieve them.
'Peak earnings' is the age when you earn the highest wage relative to hours worked. Most workers can expect to achieve their highest earnings in the middle of their careers, and this is influenced by a combination of factors including experience, location, education, industry, and the companies they have worked for.
Once peak has been reached, workers' salaries either stall or start decreasing slightly until they retire.
However, gender is the factor which has the biggest impact on both when and at what salary an individual peaks.
While workers in the UK can expect to achieve peak earnings at age 42 on average, Totaljobs has uncovered how existing gender pay disparities in the market see the average woman reaching her peak salary four years earlier than a man (age 40 vs 44). In fact, at their career peak, women are still earning, on average, £8,122 less than men.
Stuck at base camp?
At the beginning of their careers, earnings seemingly get off to a promising start for women. The Peak Earnings Predictor reveals that at age 21, a woman's peak salary can rise above that of a man by £631. However, according to the data, this is the first - and last - time women can expect this to happen. Men's average earnings consistently stay above that of women's, up to peak, and long past retirement age.
Previous research from Totaljobs carried out in the last 12 months has found that women's salary expectations are typically significantly lower than men's. On average, men ask for 29% more than women when they start a new job, resulting in a £7,430 gender salary expectation gap.
And it does not stop there. Contrary to popular opinion, women receive as many pay raises as men do - but they usually end up receiving £446 less on average. These factors are part of a cycle of actions and attitudes that contribute to the UK's existing gender pay gap issue known as the Gender Pay Trap.
Climbing to the top
Level of education has long had a defining impact on access to employment, but it also has a transformative effect on the peak salary an employee could expect to earn in their career.
For an individual who obtains a Doctorate, their salaries peak at 58 with a high reward of £81,066 on average. This would be a financial boost of £16,373 per annum which would be achieved 8 years earlier, compared to the average peak of someone holding a bachelor's degree.
Another step people can take to boost their salary is to switch industry. Totaljobs has found that the industry with the highest peak earnings potential is Finance, with the peak earnings high of £72,361 at the later age of 64.
Mind the Gap
London remains the place to go for the nation's highest salaries and the same is true of peak earnings, with employees able to achieve a career high of £63,508 at the age of 47.
In comparison to the West Midlands, where workers achieve the second-highest regional peak, Londoners still stand to earn £4,349 more and reach the top almost two decades (18 years) earlier.
In the North East, workers hit their peak just a year after Londoners (48), but their reward is only £39,617 - that's £23,891 less than workers in the capital.
Totaljobs' CEO, Jon Wilson commented:
An individual's 'peak' is heavily influenced by a combination of factors, such as gender, region, age, education, and experience.
Finding the balance between achieving the right salary at the right time for personal priorities can be a real challenge, and workers are often navigating salary negotiation without really knowing what is fair and what they're worth.
For more information visit totaljobs.com