Research published in the British Journal of Industrial Relations has found that the UK’s gender pay gap has been underestimated for more than 20 years. The study suggests that since 2004, the Office for National Statistics (ONS) failed to properly account for receiving more data from larger employers when compiling its Annual Survey of Hours and Earnings (Ashe).
This led to the survey giving undue weight to larger businesses, where pay is generally higher and the difference between men’s and women’s pay is smaller. As a result, smaller private businesses were under-represented, particularly with regard to women’s pay and representation.
The paper says the ONS consistently underestimated the gender pay gap by a “small but noteworthy” margin of one percentage point. The Ashe survey is used by the Low Pay Commission to monitor the impact of the minimum wage and by the Office for the Pay Review Bodies to help determine public sector pay settlements, meaning the flawed data may have influenced key pay decisions.
Lead author Professor John Forth of Bayes Business School at City St George’s, University of London, said the survey’s data has “far-reaching consequences across our society”, informing everything from official pay recommendations for doctors and nurses to anti-poverty measures such as the national minimum wage. He stressed that it is “crucial” the data truly represents wages and earnings in modern Britain.
The ONS told the Financial Times that the survey’s sampling and weighting were under review and that it had improved its approach since 2024 to address some of the issues raised. It added that weighting schemes are one aspect of the methodology and are regularly scrutinised. Professor Forth welcomed the review, encouraging the ONS to make the data more representative of jobs in all types of organisations.
