We often hear about the gender pay gap but recently there has been an increasing amount of focus on the gender pension gap.
New data’s revealed that more than half of women (53%) expect to work beyond retirement age. This is because they don’t feel their pensions are sufficient enough to enable financial independence in retirement. The data, collated by Working Wise, surveyed 1,356 women aged 45 and over.
Career breaks and part-time working
Of these respondents, it was revealed that 83% worked part-time for at least a year and 27% worked part-time for over a decade during their careers.
In fact, 71% said that the reduction in their pension payments was down to having a career break or working part-time, while 64% claimed they’d stopped paying into their pension entirely due to breaks or a reduction in working hours.
It seems that caring responsibilities still mainly fall to women with 63% stating that this had affected their career progression and opportunities in the workplace and it’s clear the gap begins to widen significantly at the point where women taken on such responsibilities.
Of the 6.2 million families with dependant children in the UK, over 7 in 10 have both parents working, highlighting a need for greater fairness when it comes to pay and pensions for working mothers.
However, it’s not just childcare duties and raising a family that were found to affect women’s pensions. The menopause also played a role too, with 28% of respondents saying this had had an effect on the amount they have contributed to their pension.
Another third stated that they had reduced their hours at work due to ill health.
Closing the gap
There is plenty that employers can do to play their part in bridging the gender pension gap. With the gap not due to reportedly close until 2050 and currently hovering at around 38%, there is no better time to start.
Flexible working is playing an ever-increasingly important role in ensuring that women don’t leave the workplace entirely in favour of career breaks.
Recent data shows that over half of women experiencing a lack of flexibility at work has pushed them to leave or consider leaving their role.
Leaders may be able to prevent this by putting in flexi-working strategies in place to support women with caring responsibilities, experiencing menopause or undergoing any long-term health issues.
Another large barrier to levelling the gap is that of financial awareness. Working Wise’s survey revealed that 58% of respondents don’t actually understand their pension.
This highlights a need for greater financial education around the subject of pensions, particularly the impact of reducing or stopping contributions on retirement.
Only 12% of women said that their employer had shared plans on how it proposed to reduce its gender pension and pay gaps, with just 19% offering financial education to employees.
What can you do?
As an employer, it’s never too late to implement positive change. Offering comprehensive workshops and courses to help promote financial wellbeing among your team may reduce stress, boost employee engagement and even lower staff turnover.
It’s clear from recent data that women are missing out when it comes to understanding the value of contributing to their pension.
Brunsdon Financial offer a range of sessions and courses designed to help boost the financial wellness of you and your team.