Women Would Have To Work 8 Extra Years to Make Up For Gender Pension Gap
Credits: Jason Goodman
Women Would Have To Work 8 Extra Years to Make Up For Gender Pension Gap
Text: Izzy Copestake
Women live longer, but have much smaller pensions sustaining them.
A new report by Irish Life has highlighted a gender wealth gap between men and women saving for pensions in Ireland. The company surveyed 130,000 contributors to pension schemes, and found a 22 per cent gender pay gap between men and women. The report states “it seems the gender pay gap is aging into a gender pension gap.” The report concluded that women, on average, would have to work eight years longer than men to bridge this gap, despite the fact that men and women start saving at similar ages and put aside a similar proportion of their salary towards retirement. In addition to this disparity, women, on average take 6 years out of the workforce to care for children or other dependent relatives.
From 2018 to 2019, women drew down average pension pots of €69,000, whereas for men this figure was €125,000. The report didn’t predict things getting better soon, stating that in the future, women could see “pension pots of circa €120,000 less than men.” These figures become even more problematic when the average life expectancy of men and women is taken into consideration. Women, on average, live 5 years longer than men. Thus, these substantially smaller pensions will have to sustain them for longer than their male counterparts.
The report also found that women were twice as likely to be earning less than €30,000 annually, whereas men were nearly twice as likely as women to earn in excess of €100,000 annually.
“While the gender pay gap gets plenty of attention across the globe, the gender pensions gap is less known despite it being much larger,” said the managing director of employer solutions at Irish Life, Oisin O’Shaughnessy.
In terms of resolving the issue, O’Shaughnessy said, “The answer to achieving gender pension parity simply cannot be women staying on and working for eight more years while the men around them retire.” Instead, the report called for an end to rules that prevent people from contributing to the pension pot of a partner during periods of unpaid leave, in a tex efficient way, as well as a reform of pension scheme rules which disadvantage women in part-time roles, and an end to mandatory retirement ages.
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