Gender gap means women effectively go 4.5 months of the year without a pension

New TUC analysis has found that women are nearly five times more likely to be out of paid work because of caring commitments – one of the biggest causes of the income gap in retirement as it limits their ability to build up a workplace pension.

The gender pension gap means that retired women effectively go for four and a half months each year without getting a pension.

Prospect Union has calculated that the income gap between men and women in retirement is now 37.9%, more than two and a half times the gender pay gap (14.3%) for women in work (which itself remains too high). The huge pension income gap between men and women means that the average retired woman now effectively goes four and a half months of the year (139 days) without getting a pension.

The TUC has branded 12th August as Gender Pensions Gap Day – the day women pensioners effectively stop getting paid a pension because of the gender pensions income gap. The gender pay and pension gaps are closely linked, says the TUC.

There are many common drivers of both – such as women having to work part-time, lack of access to flexible working, and low pay disproportionately impacting women. However, while tackling the gender pay gap would go some way to addressing the gender pensions gap, it would not close it completely. Closing the care gap is key to closing the pensions gap. Introducing day-one rights to parental leave and flexible working will also ensure that employers are enabling families to share caring responsibilities.

The TUC says that the amount of time women spend out of paid work because of caring responsibilities is one of the most significant contributing factors to the gender pension gap. The data shows that nearly 1.5 million women who are not in paid work are undertaking unpaid caring responsibilities with women are nearly 5 times more likely than men to be out of work because of caring responsibilities. Black and ethnic minority (BME) women are 6.5 times more likely than men to be out of work for this reason. Whilst women in their 20s and 30s are most likely to be undertaking unpaid care

The research shows that women aged 25 to 34 are most likely to be undertaking unpaid care while not in paid work compared to men of the same age wth around one in 11 (8.7%) women aged 25 to 29 – more than 190,000 women – is undertaking caring responsibilities while not in paid work – compared to less than one in 100 men the same age.
And around one in 13 (7.9%) women aged 30 to 34 are caring while out of work, compared to less than one in 100 men the same age.
But at every age – from the very start right through to the end of their careers – women are more likely than men to be out of work because of caring commitments.

TUC General Secretary Paul Nowak said “Far too many women are consigned to poverty in retirement. Everyone should have the chance to build up a pension, regardless of how much they earn.

“Ministers must set out a plan for closing the gender pensions gap – and fix our pensions system so that all women can benefit from a decent income in retirement. Women leaving paid work and taking on caring responsibilities is a key driver of the gender pensions gap – and the gender pay gap more generally. Women kept out of work for caring responsibilities should build up extra state pension to recognise the value of that work. Many women in work don’t get any sort of workplace pension at all because they don’t earn enough – often because of working part-time around caring commitments.

“We also need to tackle the care gap and give greater support to those with caring responsibilities.The new government’s plans to introduce day one rights to flexible working and parental rights will go some way to helping families share caring responsibilities.Women are often the ones expected to plug the gaps when our social care and childcare systems are not sufficient. Commitments to introducing a fair pay agreement in social care and reforming the childcare and early years sector will also help to tackle drivers of the pensions gap.”