Does Government Business Correlate To Gender Disparity?

Crane and construction site

Does Government Business Correlate To Gender Disparity?

June 2, 2021
Procurement

As part of our Procuring Inequality report, we’ve analysed whether winning government business equates to a gender pay disparity. By linking gender disparity data on who won contracts with the category and value of those contracts, we are able to show for the first time whether there is a positive or negative correlation between the value of the contracts a company wins and the extent of that companies gender pay gap, effectively establishing whether it pays to be prejudiced.

In the Business Services category, there is a very strong negative correlation between a high gender pay gap and the value of contracts earned. Here we can see that as gender pay gaps increase, the value of the contracts that are being won decreases. In Construction Work the opposite is true, companies with the highest pay gaps are effectively being rewarded with higher value contracts.

This does not mean that the gender pay gap is influencing the outcomes of tenders. If a construction company chose to increase their gender pay gap it is unlikely that they would win more public sector contracts, instead the pay gap is associated with larger companies within the market and that these companies are winning larger contracts. However, our analysis does show that the issue of gender pay disparity is not impacting suppliers’ ability to win business, and that government is effectively providing tacit approval of pay disparity with the contract awards that they make in this category.

Different categories are showing differing trends with the majority of categories generating rewards for the disparity. The Government has frequently taken a category-led approach to purchasing, and this analysis demonstrates that a category-led approach to tackling pay disparity may be the most fruitful approach, should governments seek to change pay disparity in their supply base.

Talk to us about our work in government procurement data, or our research projects.

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