Women’s pay is limited by the degrees they choose, says IFS

WOMEN earn less than men in their twenties because they are choosing the wrong subjects at university, the Institute for Fiscal Studies (IFS) has found.

The gender pay gap emerges almost immediately after graduation, with male graduates earning on average five per cent more than female ones at the age of 25, according to a new analysis.

“Most of the initial gap can be explained by university subject choices, with women less likely to study subjects that lead to high-paying jobs,” researchers at the IFS explained.

“Women make up just a third of graduates in economics, the subject with the highest financial returns, and twothirds of graduates in creative arts, the subject with the lowest returns.”

Today is the deadline for big companies to report their gender pay gaps.

The gap between men and women’s earnings increases sharply after women have their first child and women are more likely to choose a job closer to home or opt for a part-time role.

But the IFS research shows that even before women have had their first child, they are already paid less than men with similar qualifications.

Women are more likely to graduate from university with a first class or an upper second class degree than men. But at age 25 women earn on average five per cent less than men and by age 30 – before most graduates start having children – the gender pay gap increases to 25 per cent.

Xiaowei Xu of the IFS said: “More needs to be done to inform young people about the financial consequences of degree choices, and to overcome gender stereotypes, so that women are not locked out of high-paying careers by choices at a young age.”