Why is the gender pay gap still an area of huge concern in the UK? A press release by Key highlights how women who may want to retire in 2021 receive 25% less than their male counterparts.
Men may receive 29% more than women
The gender gap becomes very wide if you calculate the retirement that men and women receive over several years. Research suggests that the amount of money that men receive over 20 years after retirement is significantly higher than that of women.
Men may even receive as much as £93,000 more than women who have retired. Although there still is a long way to go, there seems to be an improvement to the previous year. Men who retired in 2020 could expect 29% more income (£22,876), compared to their female colleagues (£17,762), than those who retired in 2021, according to the study.
Will Hale, CEO at equity release specialists, Key said: “With women typically earning less over the course of their careers, more likely to work part-time or need to juggle their career and caring responsibilities, the gender pay gap quickly becomes the gender pension’s gap at retirement. It is disheartening that in 2021, women still expect 25% less than their male counterparts and nearly a third expect their income to fall below Joseph Rowntree Foundation’s (JRF) Minimum Income Standard.
How can the situation improve?
What will make the amount that men and women have available during their retirement more equal? How can the gap close? What are the reasons for the gender gap?
“There is no quick fix to this situation, but it does illustrate how important it is to consider all your assets at retirement”, Will Hale says. “In 2021, more women (15%) than men (10%) said they intend to release equity from their home to support their retirement income needs. Given the significant shortfall that many men and women will face, this figure should be higher – especially as modern equity release products boast flexible features which makes managing this borrowing in line with changing circumstances far easier than ever before.”
One of the reasons for the divide between retirement income is that more men hold senior positions, which offer better retirement packages. Others include the unequal pay for the same role or that woman who care for children while their partner works may only be able to work part-time jobs.
There are many strategies that businesses are able to implement to ensure gender pay gap isn’t an issue in their company.
Poppy Watt