Massive decrease in gender pay gap seen in the UK: PwC
The overall UK gender pay gap has seen one of the largest decreases since the introduction of pay gap reporting, signalling the sustained efforts by organisations driving change, according to PwC analysis.
However, even with this year’s large decrease, data shows the longer-term overall pace of change remains slow, and it will take at least another 40 years for the pay gap to close completely.
The 2025 Gender Pay Gap Report, published by PwC, shows a decrease of 0.6% in the mean hourly pay gap, narrowing from 11.8% to 11.2%, and a decrease of 0.5% for the median hourly pay gap, from 9.1% to 8.6%.
This compares to a decrease of 0.4% in 2024, and is one of the most significant year-on-year improvements to date – the largest being a 0.7% drop in 2022/23. This year saw over 10,700 organisations submitting gender pay gap data, the highest number since reporting became mandatory for companies with over 250 employees.
Policy changes, such as the introduction of the Equality (Race and Discrimination) Bill, which proposes to extend gender pay gap reporting to include mandatory ethnicity and disability reporting in the UK, along with additional pay gap reporting and pay transparency obligations introduced across the EU, are continuing to help shine a spotlight on pay fairness.
These measures continue to hold organisations to account on pay gap reporting and contribute to an increasingly complicated regulatory landscape.
“The dial is finally shifting. Whilst we’re seeing incremental change, this year’s data shows that when employers take deliberate action over the long term, progress follows, although it will still take a long time for the pay gap to close,” said Andrew Curcio, Global Co-Leader for Reward & Benefits at PwC.
From reviewing pay structures, improving gender balance of senior roles, and transparent and inclusive promotion and recruitment processes, the organisations making the biggest strides are those embedding equity and consistency into their day-to-day decisions, not just their annual reports, he said.
“Employers are operating in a new world with increasing levels of compliance and regulation, so it is more important than ever to sustain momentum – and shift the conversation from compliance to commitment.
“Employers are increasingly recognising that pay gap reporting is not just a regulatory requirement—it’s a strategic imperative tied to talent, reputation, engagement, productivity and performance.”
A clear difference in sectors
Sectors with typically a higher proportion of women working in them, such as hospitality, public administration and health, report the lowest pay gaps. These sectors also tend to rely on hourly wage structures rather than salaried roles, resulting in less variation in pay and smaller gaps.
By comparison, despite seeing the largest decreases in mean pay gaps compared to last year across the financial services sectors, they continue to report the biggest gender pay gaps. Whilst continually showing progress in reducing their pay gaps, the large pay gaps are reflective of ongoing issues with gender equality within the sector.
The analysis shows that the average mean hourly pay gap decreased for organisations of all sizes, with the largest decrease of 1.1% for organisations with between 5,000 to 19,999 employees.
Each year, the largest employers (with 20,000 employees and more) have the lowest mean hourly pay gaps in contrast to the smallest organisations, which typically have higher levels of volatility in their pay gaps.
