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Wider reform needed to plug gender pension gap

by uma
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The World Economic Forum’s Global Gender Gap report looks at progress being made to close the gender gap in areas such as educational attainment, health and survival and political empowerment.

It says it will take 132 years to reach full gender parity globally. Regionally Europe could close the gap in 60 years.

Iceland leads the global ranking with the UK coming in at number 22.

Gender parity in the workforce stands at 62.9% globally, the lowest level registered since index was first compiled. The pandemic has had a big impact with many women leaving the workforce.

When it comes to wealth accumulation gender pay gaps and unequal career progression trajectories are key contributors.

For frontline operational roles, the overall gender wealth gap averages 11%; for professional and technical type roles, the gap nearly triples, averaging 31%; and for senior experts and leadership, it grows further to an average of 38%.

The World Economic Forum has released its Global Gender Gap Report 2022 Preface – Global Gender Gap Report 2022 | World Economic Forum (weforum.org)

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown:

“This report lays bare the enormous global challenges women face in the workforce and the knock-on effect for their overall wealth. Gender parity in the workforce stands at a real low as the pandemic forced many women out of the workforce as they were more likely to be made redundant.

Women were also more likely to take on the responsibilities of home schooling and looking after children and doing this alongside a job can be a nigh on impossible balancing act.

Even before the pandemic, it is clear that juggling these responsibilities impedes women’s progress in the workforce – they may be more likely to get senior positions now than in the past but time out of the workforce means it will take longer for them to get there and so they spend less time earning top salaries. This added to the much-discussed gender pay gap means women continue to face real obstacles when it comes to building wealth and has a huge impact on women’s retirement planning in particular.

Regular contributions over the long-term are the best way to build a resilient pension pot but this is not an option available to many women. Lower wages, part-time work, time out of the workforce and unequal career progression cause huge disruption to their long-term financial planning and this is why we see the gender pension gap continue. Solving this problem will take more than closing the gender pay gap, women need more support with childcare costs and flexible working to really make up ground.”

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