Women graduates expect 8% less than men when it comes to their first paycheck, signalling that the gender pay gap begins before women employees have even started their first job.
In a survey by hiring company Bright Network, female graduates said their expected salary for a first job was almost £2,500 less, on average, than what male graduates asked for.
The disparity is just under the median gender pay gap in 2023 of 9.1%. It suggests that low self-confidence is holding young women back at the start of their career; an issue which serves to worsen the difference in earnings between male and female employees later on.
Gender Pay Gap
As new graduates start looking for their first job this summer, the Bright Network data shows that they could face a gender pay gap for their entire career.
In the survey of 14,000 Bright Network members, female students said their expected base salary for their first role was £29,158, compared to £31,627 for male students.
This tracks with government data, which shows the average gender pay gap for employees aged 22-29 is 3.0%, despite new starters likely having the same level of experience.
The gender pay gap does not refer to female employees being paid less than men, as this would be considered illegal under the UK’s Equality Act 2010.
However, due to various causes, women can expect to earn less over their entire career than men, thanks to the Motherhood Penalty and, as the Bright Network research suggests, lower self-confidence when it comes to negotiating salary.
Thankfully, things may improve when women have been at a company. Contrary to popular belief, research shows that women do ask for a pay review or increase as much as men. However, they are less likely to have one approved than their male colleagues.
Class Pay Gap
The research also finds that half of students surveyed believe their background hinders them in job and study applications, with 4% citing socioeconomic background as the main barrier.
Less-known than the gender pay gap is the class pay gap, the phenomenon where working class people receive lower salaries and fewer opportunities than more privileged peers.
One report estimates that those from higher professional backgrounds earn 18% more than those from a lower working class background, even with the same level of education.
The issue appears to have leaked into interview rooms. Bright Network found that state-educated respondents expect an average starting salary of £28,218. This is compared to private school-educated graduates, who want to earn £30,617 straight out of university.
Slower pay growth curbs graduate optimism
Recruiters had previously reported feeling “put off” by younger workers expecting a higher rate of pay and flexible working. Their list of demands appears to be diminishing, however.
The Bright Network data shows there has been a drop in uni leavers’ expected salaries. Graduates expected to earn £29,920 per year in 2023; £145 less than the 2024 figure.
This could be a reflection of today’s challenging jobs market. Last year, record pay rises dominated the news headlines as employers fought to keep top talent from switching jobs.
Today, the situation has cooled. In mid-July, official figures showed that wages grew at an annual pace of 5.7% in the three months to May, the slowest pay growth rate in two years.
Degrees no longer a good-wage guarantee
The £29,675 figure comes despite the National Living Wage rising substantially at the start of April. Under the new rates, minimum wage workers aged over 21 earn £11.44 per hour.
That equates to £23,795 per year if working a full-time role with a 40 hour working week. It means that the majority of graduates believe they will earn just under £6,000 more than a (typically unskilled) minimum wage worker, once they have completed their degree.
Historically, attending university has been seen as an entry ticket into a higher paying job role after graduation; a myth that has persisted due to outdated recruitment practices.
However, increasing scepticism towards the value of completing an undergraduate degree is perhaps what has contributed to graduates expecting a lower starting salary year-on-year.
78% of students said they had considered leaving university during their studies, according to a survey of 1,000 students by Generation Logistics. Of these, 22% said they did so to avoid career regret, as they decided university was not the right path for their ambitions.
