Financy has just released its latest Women’s Index Report, which shows that although the gender gap is closing, history is still holding women back and that more could be done to close the gender superannuation gap.
The main points that were found in the March quarter report is that the Financy Women’s Index decreased from 73.8% to 72.2%, which is the weakest start to a calendar year in a decade.
The report estimates that it will take 28 years to achieve full equality in employment, which is an improvement from the previous period of 29 years.
It will take 22 years until wage gender equality is achieved, with the national gender pay gap sitting at 13.9%. It has fluctuated throughout the pandemic with market conditions being volatile.
Financy found that it will take 19 years until gender equality in superannuation balances is achieved, down from 31 years, due to an improvement in women’s median lifetime balances.
The latest superannuation figures released by the Australian Bureau of Statistics show that the median lifetime balances of women as of June 30, 2020, were $50,000 compared with $67,000 for men.
The superannuation gender gap is attributed to various factors including the fact that women earn less than men and have a lower workforce participation rate due to family and other unpaid commitments. Women are more likely to be underemployed than men and have the capacity to take on additional work.
The biggest superannuation gains were between November 2019 to November 2020 when the gender pay gap decreased from 13.9% to 13.4% however in the March quarter it was back at 13.8%.
Partner Deloitte Private National SMSF Leader Liz Westover said in the report: “The good news is the superannuation gender gap is narrowing. The reality is there is still so much more that needs to be done to actually close it.
“Clearly, the rise in the mandatory super guarantee (SG) rate to 12% is critical to improving retirement savings for everyone and importantly the women who are most at risk of poorer retirement outcomes.”
She said that the removal of the $450 per month earning threshold for the superannuation guarantee to be paid from July 1, 2022, is a step in the right direction however superannuation contributions should be made on paid parental leave across the board.
She also said that we need to improve financial literacy for women and remove barriers for additional contributions, with a suggestion that incentives are not linked to employment.
Wisr Chief Strategy Officer, Dr Lili Sussman said: “Business too, has a big part in changing the societal, economic and financial expectations of both women and men – taking bigger steps toward gender equality and making sure it’s measured and robust inside our organisations.
Ms Sussman believes we all have a role to play in improving gender equality and says that we are heading in the right direction but there is more we could do for ourselves and those around us by supporting women to stay in the workforce rather than “phasing them out of the workforce” and by talking about unconscious bias.
Canstar Editor-at-Large, InvestSMART independent director, Effie Zahos says that we must sto penalising Australian families, in particular, women for having children and says that even just making small contributions to your super can make a huge difference. Just adding an extra $1 a day from the age of 35 could add an extra $148,389 by the age of 67.
In previous reporting periods it would have taken 100 years to achieve gender equality in Australia however it is now only 59 years and Australia ranks 50th in the world according to the World Economic Forum’s Global Gender Gap Index 2021 rankings.