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One high-paid occupation where the gender wage gap has disappeared: Vice Chancellors of the UK’s universities

The gender wage gap tends to be larger among high earners, and is particularly acute among academics. But for one occupation, this trend no longer holds – the gender gap among Vice Chancellors running UK universities has disappeared. This column finds no evidence that the quality of women entering the profession has risen. Instead, hiring practices have changed. A university’s success is increasingly reliant on attracting and retaining top talent, and the visibility of Vice Chancellors’ pay makes unequal treatment in the top jobs transparent, resulting in substantial disadvantages for institutions that discriminate.

Across much of the developed industrialised world, the gender wage gap – the gap between men’s and women’s wages – has fallen in recent decades (Kunze 2018). But women continue to earn less than men, even though they outperform men in education, and even though gaps in labour market experience are closing with the rise in women’s potential earnings and changes in fertility behaviours (Bryson et al. 2020). The gender wage gap is most persistent at the top end of the wage distribution among men and women in high-paying occupations (Blau and Kahn 2017). These are occupations in which long work hours are expected and jobs are designed in ways that make it difficult to combine family with continued career progression – features that often work to the disadvantage of women relative to their male counterparts (Goldin 2014, Bertrand et al. 2010, Kunze and Miller 2017, Bütikofer et al. 2018).

The gender wage gap is particularly acute among academics in higher education. Even within disciplines, women earn less than men, particularly at the associate professor and professor level (Bedard et al. 2021, LSE 2021, Mumford and Sechel 2020). Discrimination appears to play a part, whether in having papers accepted to conferences (Hospido and Sanz 2021) or with student ratings (MacNell et al. 2015).

Some 20 years ago, the same might have been said of the highest paying occupation in academia, namely Vice Chancellors (known as University Presidents in the US), who run UK universities. With newly assembled data on 346 Vice Chancellors (VCs) in 115 higher education institutions in the UK, we show that female VCs earned roughly four-fifths of what their male counterparts earned in 2000. Two decades later, the gap had disappeared.

Figure 1 Real earnings (2015 prices) over time among male and female Vice Chancellors

Real earnings (2015 prices) over time among male and female Vice Chancellors

In our newly published paper (Bachan and Bryson 2022), we explore why. What changed?

First, we show that two things did not change. We found no evidence to suggest that the unobserved quality of women entering the profession had risen relative to that of men. Nor was it the case that women were more likely to enter universities that tended to pay higher wages. However, hiring practices had changed. We find that women were breaking through the ‘glass ceiling’. Although it remained a male-dominated profession, the percentage of universities run by women more than doubled, to 24%. Furthermore, women had broken into the ‘top’ institutions in the sector. For instance, the University of Oxford had a female VC (Louise Richardson) for the last four years of our data (2016–2019) after 16 years in which the university was run by a succession of three male VCs.

The closing of the gender wage gap among VCs was accounted for by changes in the observed attributes of male and female VCs and the universities they lead – in particular, the financial performance of universities employing female VCs.

We also find that the ‘new starter’ wage penalty women faced in the early 2000s disappeared in the second decade of the 21st century. Similarly, in the first decade women received a lower wage when replacing an outgoing male VC, whereas no differential was apparent between incoming male VCs and the women they replaced. This differential was no longer apparent after 2010. These findings are consistent with a reduction in discriminatory wage-setting for VCs in UK universities.

Are there lessons to be learned from the recruitment and rewarding of VCs that might be applicable more broadly in UK universities where gender wage gaps persist among top academic professionals? At first blush, one might not think so. VCs are different than many of their university colleagues. Their mean age is 58 (ranging from 43 to 76 in our data), so most of the women among them have already jumped through the barriers to promotion linked to childcaring responsibilities earlier in their careers. They no longer face the challenges of balancing work and family life that their younger colleagues face.

But there are clear indications of change in the way universities recruit and reward men and women at the top. Whilst there is some segmentation in the market – 64 of our 115 universities failed to employ a female VC over the 20 years of our study – women are penetrating the profession, including the higher paying institutions. Furthermore, both starter wages and returns to tenure are similar for male and female VCs today, and the unexplained gap in earnings is not significant.

There are two potential reasons for the shift in practice. First, the VC role has changed substantially in the last 20 years. Today, it is akin to the CEO role in private corporations. The success or failure of universities is increasingly reliant on attracting and retaining top talent, which implies substantial penalties for institutions who discriminate, either consciously or otherwise, in the appointment and rewarding of VCs.

Second, the visibility of VCs and their pay means any unequal treatment of men and women in top jobs is immediately apparent. As others have noted (Bennedsen et al. 2020), transparency can help address gender wage gaps, in part through the reputational damage it can do to an institution. Perhaps greater pay transparency further down the pay hierarchy will help close the gender wage gap that persists among highly qualified professional academics in higher education.

Authors' notes: Alex Bryson thanks the Economic and Social Research Council for funding (grant number ES/S012583/1). Our data are available to other researchers. Please contact Ray Bachan ([email protected]).

References

Bachan, R and A Bryson (forthcoming), ”The Gender Wage Gap Among University Vice Chancellors in the UK”, Labour Economics.

Bennedsen, M, E Simintzi, M Tsoutsoura and D Wolfenzon (2020), “Pay Transparency and its Effect on the Gender Pay Gap”, VoxEU.org, 07 May.

Bertrand, M, C Goldin and L F Katz (2010), “Dynamics of the gender gap for young professionals in the financial and corporate sectors”, American Economic Journal: Applied Economics 2(3): 228–255.

Blau, F D and L M Kahn (2017), “The gender wage gap: extent, trends and explanations”, Journal of Economic Literature 55(3): 789–865.

Bryson, A, H Joshi, B Wielgoszewska and D Wilkinson (2020), ”A short history of the gender wage gap in Britain”, Oxford Review of Economic Policy 36(4): 836–854

Bütikofer, A, S Jensen and K G Salvanes (2018), “The Role of Parenthood on the Gender Gap Among Top Earners”, VoxEU.org, 29 November.

Goldin, C (2014), “A grand gender convergence: its last chapter”, American Economic Review 104(4): 1091–1119.

Hospido, L and C Sanz (2021), “Gender Gaps in the Evaluation of Research: Evidence from Submissions to Economics Conferences”, Oxford Bulletin of Economics and Statistics 83(3): 590–618.

Kunze, A (2018), “The gender wage gap in developed countries”, in The Oxford Handbook of Women and the Economy, Oxford University Press.

Kunze, A and A R Miller (2017), “Women helping women? Evidence from private sector data on workplace hierarchies”, The Review of Economics and Statistics 99(5): 769–775.

London School of Economics (2016), “The Gender and Ethnicity Earnings Gap at LSE”, LSE Equity Diversity and Inclusion Task Force, September.

MacNell, L, A Driscoll and A N Hunt (2015), “What’s in a Name: Exposing Gender Bias in Student Ratings of Teaching”, Journal of Collective Bargaining in the Academy, Article 52.

Mumford, K and C Sechel (2020), “Pay and job rank among academic economists in the UK: is gender relevant?”, British Journal of Industrial Relations 58(1): 82–113.

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