Meg Munn MP

WOMEN IN BUSINESS

It’s great to see so many of you here. It’s a testament to the progress we’ve made as a society in breaking down barriers, and opening up opportunities for women at work.

I’m pleased with the progress, but it’s not enough – not by a long chalk.

Today I’d want to talk about three of the big questions that we need to resolve in order to, not just crack, but break the glass ceiling.

Why are so few women self-employed?
Why are women still over-represented in low-paid jobs, and under-represented in sectors like science?
Why are women still paid less than men?

These are issues that matter not just for the individual, but for the country. Government, employers, and society at large, must tackle them. I want to outline some ideas about how we can.

Women comprise 52% of the UK population, and 46% of those active in the labour market. Anyone wanting to boost entrepreneurial activity would be plain silly to ignore us - but that’s what society has been doing. The potential for the development of women entrepreneurs is huge.

If we had the same rate of female owned start-ups as in the USA, we would have 750,000 more businesses. This would have a major impact on productivity, employment and prosperity. At the moment, women-owned businesses contribute about £70 billion to Gross Value Added; about 25% of the UK total, mainly from the growing service sector.

Nearly a million women are self-employed and this number has gone up by around 10% over the last four years. Despite this, only 26% of the total self-employed are women, and only 15% of all businesses are majority-owned by women. This differential between men and women-owned businesses has hardly changed in a decade. We have to do more: we aim to raise the female business-ownership level to 20% by March 2006. That’s an increase of five per cent.

There are many individual success stories some sitting in this room – I’d love to talk about all the ones I’ve read about and heard about but there isn’t time. Let me just tell you about two – one that I know personally and the other I have read about and want to get to know more about.

Diva is a local marketing and PR company owned and managed by women established in 1997. They have won many awards and continue to go from strength to strength, featuring in the top 10 of the inner city 100. Diva is a leading local SME.

Clean & Bright were set up in April 2003 in Longley. A feasibility study identified a niche in the cleaning market – organisations in the voluntary and community sector were keen to contract with a social economy enterprise. At the outset the company was Anita and a broom cupboard full of equipment but now she employs 20 people and has 15 secure contracts. The company tries to employ women and men returning to work – flexibility is a key feature allowing employees to combine personal commitments with work.

What do these two stories tell us? That women can and are taking the initiative and daring to succeed in the small business market.

Another of my Ministerial roles is to challenge occupational segregation –where women are over-represented in certain types of low-paid jobs, and under-represented in other sectors, such as science.

Tackling occupational segregation is crucial in raising UK productivity and reducing the gender pay gap. Sectors in which women are poorly represented - construction and plumbing for instance - tend to have large skill shortages. Occupational segregation is acting as a brake on UK economic growth and productivity.

Some of you may know that in October 2004, we launched a cross government plan: ‘Equality, Opportunity and Choice: Tackling Occupational Segregation’, highlighting government action to encourage both women and men into non-traditional areas of work.

The Trade and Industry Select Committee share our concern. Earlier this year the Committee published its report ‘Jobs for the Girls: The effect of occupational segregation on the gender pay gap’. The Government’s response includes details of what we’re doing to ensure that women are able to make informed choices about training and careers.

The Equal Opportunities Commission’s Investigation into Occupational Segregation is helping us determine the path we need to take. The Women and Work Commission will be issuing its report on the ‘gender pay gap’ shortly, and will be vital in helping decide how to tackle this longstanding problem. Only yesterday a report from academics at Sheffield Hallam University told us that millions of women are being employed below their potential and held back from senior level jobs.

We have already begun specific action to challenge under-representation in particular sectors. We’re providing £4m for the UK Resource Centre for Women (UKRC) in Science, Engineering and Technology. The Centre is working with employers and professional organisations to raise the profile of women through a range of initiatives. These include a resource centre website and helpline, providing a wealth of information and advice to girls and women considering science, engineering and technology careers.

The Centre is based in Bradford and I visited it earlier this week. I met women who had been supported by the Centre and learnt how they were able to use their knowledge and skills in science and technology in their work. There are not enough women who follow careers into science, engineering and technology - but more worrying, too many women who have these skills do not go on to use them.

At the centre I also met employers, some from the construction industry. Too few women go into construction and too often those that do face prejudice and discrimination. One employer told me that in his experience women in construction jobs were often more capable than men but were assumed to be less so.

I was delighted that London won the Olympics for 2012. There will be many job opportunities in construction associated with the development of the Olympics and we must work to ensure that women have opportunities as the sector further expands.

I know that Sheffield Hallam University are closely involved with the UK Resource Centre, running courses locally. I encourage those of you involved in this sector to have a look at the UKRC’s website.

Fortunately, we have important allies in the business world taking occupational segregation seriously. For example, cosmetics company L’Oreal have joined the UKRC in launching in July a programme to help female scientists returning to work after a career break. Three cash bursaries of £10,000, jointly funded by the partners, will be granted each year to women scientists.

Similarly, ABB – a global electrical engineering company – actively supports programmes encouraging women to enter careers in science. Farsighted companies know that in an expanding economy with some growing skills shortages, they have to encourage and support women to ensure they will get a skilled, professional workforce.

Sector Skills Councils and Learning and Skills Councils - whose role is to address industry specific training needs and broaden post-16 learning opportunities - are looking at ways to tackle occupational segregation. Their research and initiatives could provide valuable lessons to share across a range of sectors.

The Government will continue to lead in tackling occupational segregation. By 2008, we aim to ensure that women make up 40 per cent of the representation on science, engineering and technology related boards and councils.

We also aim to reverse the serious under-representation of women in the information, technology, electronics and communications (ITEC) sector. The UK must at least match the best of our competitors. As a first step, by 2006 we plan to increase the proportion of women in the UK ITEC workforce from the 2002 figure of 23%.

A final word on occupational segregation: why concentrate on women?

Yes, girls are outperforming boys in education.

Yes, women now outnumber men in the most junior ranks of traditionally male professions, such as law and medicine.

However, a significant gap exists between the numbers of men and women who reach senior positions. Also, women’s employment opportunities continue to be constrained by subject choices made at school. There remain significant job areas which appear to be ‘no go’ areas for women.

Finally, I’d like to talk about another area where we simply must see change - the gender pay gap.

This gender pay gap is a problem. We can take some encouragement from the continued fall in the full-time median gender pay gap from 17.4% in 1998 to 14.4% in 2004 - which shows that year on year the majority of women are experiencing rising pay relative to men.

There is evidence that policies introduced to improve the chances of women participating in the labour market are working. We’ve have tried to break down barriers that women face when trying to balance work with caring responsibilities – for example, by providing better access to childcare, and introducing flexible working laws.

The Government believes that women have the right to expect a fair deal in the labour market. That is why the Prime Minister announced the creation of the Women and Work Commission in July last year to examine the persistent problem of the gender pay gap. The Women and Work Commission, chaired by Baroness Prosser, will report in later this year with recommendations to tackle this problem.

With equal pay reviews, the Government is leading by example. All 88 Government Departments and agencies have now completed pay reviews and submitted action plans. We want 45% of large organisations to have undertaken pay reviews by April 2008.

To make this easier for organisations we are supporting a team of Equal Pay Panel of Experts, led by the Trades Union Congress. The experts will offer free advice to organisations looking to undertake an equal pay review.

An example from the commercial world is Serco, a large UK service company. It has recently engaged with the Panel of Experts. As a result, it has decided to roll out equal pay audits initially across its health and science divisions, with the aim to extend this work across the whole of the business.

Finally, the DTI is carrying out a Discrimination Law Review, which will examine the current anti-discrimination legislative framework, including the Equal Pay Act 1970.

The Government doesn’t underestimate the difficulty of the task, but equally we won’t dodge it.

The three areas I have spoken about today are complex, and we are on a road of improvement rather than the end. But the positive impact on society, and not just in the economic sphere, means we have to continue. It’s not just the big picture, the individual stories from women who have turned their business ideas into reality in a variety of areas remain with me. For all of us, women and men, having the opportunity, encouragement, and support to try and fulfil our potential, well it might sound trite in our cynical age – but it’s important to me.