Natalie Previtera

Australia’s progress toward financial gender equality has reached a new high, with the latest Financy Women’s Index (FWX) hitting 79.44 points in the September quarter.

The result, up from 79.32 points in June, was primarily driven by a sharp improvement in female underemployment and a narrowing of the gender gap in lifetime superannuation savings.

Key points

• Record high: The Financy Women’s Index (FWX) rose 0.12 points to a fresh high of 79.44 points out of 100 in the September quarter.
• Superannuation gender gap narrows: The Superannuation sub-index was a standout performer, gaining 0.6 points. The estimated timeframe to  achieve gender equality in superannuation has dropped significantly to 13.9 years (down from 17 years).
• Headwinds: Despite the record result, a crisis of confidence in the childcare sector and stalling board diversity suggest the victory is “fragile,” with early signs of women stepping back from full-time work.
• Boards stalled: Progress on ASX 200 Boards has flatlined. The sub-index remained stalled at 38.1%, marking a second consecutive quarter of zero growth and signalling “gender diversity complacency” at the top.
• Call to reform: The report calls for structural reforms to lock in these gains, including urgent action on childcare quality and investor pressure on stagnant boards.

The Underemployment sub-index delivered the quarter’s strongest performance, rising 0.8 points to 75.3 points. This shift suggests an easing of financial pressures on the homefront and that more women are securing their desired working hours, with the female underemployment rate falling 1.5 percentage points.

Superannuation gap closing

The outlook for women’s long-term financial security also brightened. The Superannuation sub-index rose 0.6 points to 79.2 points, aided by a revised dataset from the ATO and improved female wage growth.

Consequently, the estimated timeframe to close the gender gap in superannuation savings has fallen to 13.9 years, down from 17 years previously. It is now the second-shortest timeframe to equality of any index after ASX 200 Boards at 4.7 years. The median timeframe to economic equality is 21.2 years.

Natalie Previtera, CEO of NGS Super, celebrated the momentum but emphasised that these gains must be structurally protected rather than relied upon by women acting as the economy’s “shock absorbers.”

“While our progress is real and the momentum is visible, the opportunity now is to design an economy where resilience is structural, not gendered. Equality should not be something women must absorb their way into, but something Australia builds into its foundations.”

“The lesson from this quarter’s FWX is not that women are faltering. It is that women have carried the burden of resilience long enough and that, with intentional investment, the burden itself can finally lessen.

While the FWX headline numbers are positive, the report warns of “fragile progress.”

Beneath the record high, there are signs of a compositional shift in the workforce. Women’s full-time employment fell slightly (0.1%) in the quarter, as part-time employment rose, and participation rates retreated from recent highs, coinciding with a drop in childcare usage.

Rhiannon Yetsenga, Associate Director at Deloitte Access Economics and FWX Advisory Committee member, noted that trust in the childcare sector, which is grappling with abuse cases, is essential to maintaining workforce participation.

“When families can’t trust the childcare system, women step back from work and men stay out of the care workforce – reinforcing the idea that caregiving is ‘women’s work’,” said Yetsenga.

“Breaking that cycle starts with affordable, high-quality childcare, unlocking more equal participation and a more balanced gender workforce over time.”

Leonora Risse, Associate Professor in Economics at the University of Canberra, added that the decision to step back often carries an invisible cost.

“The current childcare crisis goes to the heart of women’s decisions to participate in the paid workforce in the sense that it’s most commonly women, not men, who get pulled out of the workforce when childcare is constrained or their family needs them,” said Dr Risse.

“Even if the numbers suggest that some women are pulling out of the workforce, what they don’t show is the extra emotional and mental strain, as well as the potential guilt, that many parents who are still in the workforce might be going through,” said Dr Risse.

Board diversity stalls

!n contrast to the gains in employment and superannuation, corporate leadership progress has flatlined. The ASX 200 Boards sub-index recorded zero growth for the second consecutive quarter, remaining at 38.1%.

With the timeframe to board equality stagnating at 4.7 years, Financy is calling on institutional investors to vote against the re-election of directors at ASX 200 companies that have missed the 40:40:20 standard for three consecutive periods.

Bianca Hartge-Hazelman, Founder of Financy, stated: “This record high is reflective of fragile progress. While we celebrate the gains in superannuation and hours worked, the cracks appearing in childcare confidence and the stagnation in board diversity serve as a stark reminder that our progress is not yet cemented in strong foundations.”

Key September Quarter Statistics:

• FWX Score: 79.44 points (Fresh High).
• Superannuation: +0.6 points (Gap closing).
• Underemployment: +0.8 points (Primary driver of growth).
• Employment: +0.1 points (Slight improvement).
• ASX 200 Boards: 38.1% (Stalled/Zero Growth).
• Gender Pay Gap: 11.5% (Record low national gap).

Timeframes to Equality:

• ASX 200 Boards: 4.7 years
• Superannuation: 13.9 years (Improved from 17)
• Underemployment: 20.9 years
• Gender Pay Gap: 21.2 years
• Employment: 24.9 years
• Unpaid Work: 42.4 years
• Education: 348.6 years

Bianca Hartge-Hazelman

Australia’s path to gender financial equality is experiencing significant challenges, as highlighted by the latest Financy Women’s Index (FWX).

Progress to gender financial equality in Australia has taken another backwards step with the FWX showing that women are a long way from parity with the combination of key indicators suffering their worst start to a calendar year since 2022.

Declines in the FWX Employment and Underemployment sub-indexes have been driven by weaker economic conditions that have disproportionately affected women.  The September quarter saw female monthly hours worked increase by only 0.8 per cent, compared to 1.3 per cent for men.

Dr. Shane Oliver, Chief Economist at AMP, noted: “The September quarter Financy Women’s Index highlights increasing evidence that females are seeing more sensitivity to swings in economic activity than men, possibly reflecting their part-time status in discretionary services sectors. This is a big turnaround from times past when it was men in manufacturing and construction who were most vulnerable. The key is to enable more women to work full-time and in more diverse parts of the economy, so they are not as vulnerable to the vagaries of the economic cycle.”

“Over the past decade, when gross domestic product (GDP) growth has been stronger, we have seen improved employment growth for both men and women,” said Bianca Hartge-Hazelman, CEO of Financy.

“This has also been correlated with progress in economic equality, as measured by the FWX.

“But whenever GDP has weakened, we have tended to see female employment behave more volatile than male and this has recently led to declines in the FWX. It’s also important to note that FWX has been relatively flat since 2020.”

Victoria’s Minister for Women and Jobs, Natalie Hutchins, said: “Interest rates, unstable political environments in countries like the United States, and global wars are increasing the cost of living, with women often paying the price.”

The Index shows Australia’s path to gender equality in the workforce faces significant hurdles, with a 26.8-year wait for equality in Employment and a 20.6-year wait in Underemployment. The best case scenario for equality is 5.1 years via ASX 200 Board Leadership, followed by a 17.7 year wait in Superannuation savings. The wait for pay parity, and indeed the median overall timeframe for gender equality to be achieved, is 22.1 years – a generation away.

“News of Donald Trump’s return to the US presidency has come as a shock to many with fears that it will lead to a setback in progress on gender equity and more broadly in relation to diversity, equity, and inclusion,” said Dr Oliver.

“While Americans who switched sides were motivated by ‘cost of living’ concerns rather than rejecting progress on issues like gender equity, it does run the risk that gender equity will be less of a focus for the next few years in the US. We need to guard against this happening in Australia as well, to the extent that US trends often show up in Australia with a lag. The good news is that through the last Trump administration, the FWX continued to trend up.”

“Whilst we have seen female wages grow slightly faster than male wages, and this helped deliver a record breaking improvement in the FWX Gender Pay Gap sub-index, the fact that women still earn 11.5 per cent on average less than men, makes it all the more difficult to keep up with ongoing cost of living pressures, particularly those that relate to housing, groceries and utilities,” said Hartge-Hazelman.

“Compounding this is the fact that women tend to occupy the most insecure forms of employment, such as part-time and casual roles, as these are often the job types that businesses pull back on when conditions get more difficult,” she said.

“The FWX report underscores the need for policymakers and businesses to prioritize gender equality, even amid economic challenges.

“Encouraging greater flexibility in full-time work and ensuring women’s jobs are not disproportionately affected by economic pressures are crucial steps forward,” said Hartge-Hazelman.

Natalie Previtera CEO of NGS Super added: “The cost-of-living crisis is a stark reminder of the importance of financial independence for women. As leaders, employers, and policymakers, we all have a role to play in creating workplaces where women can thrive, even in the face of economic challenges. By prioritising equity and inclusion, we can build a stronger, fairer Australia for everyone”.

The Financy Women’s Index TM (FWX) is a quarterly measurement of the economic progress of women and timeframes to gender equality in Australia. The FWX is produced by Financy, which is a data insights and tech company that provides the IMPACTER Diversity and Inclusion platform. The Women’s Index is supported by an Advisory Committee which includes Dr Shane Oliver, Simone Cheung, Roger Wilkins, Leonora Risse, Bruce Hockman, Rhiannon Yetsenga and Nicki Hutley. The Index is proudly sponsored by NGS Super, the Ecstra Foundation, Aspire Planning, Seven Consulting, HeirWealth and PritchittBland Communications.

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Bianca Hartge-Hazelman

Australia’s path to gender financial equality is experiencing significant challenges, as highlighted by the latest Financy Women’s Index (FWX).

Progress to gender financial equality in Australia has taken another backwards step with the FWX showing that women are a long way from parity with the combination of key indicators suffering their worst start to a calendar year since 2022.

Declines in the FWX Employment and Underemployment sub-indexes have been driven by weaker economic conditions that have disproportionately affected women.  The September quarter saw female monthly hours worked increase by only 0.8 per cent, compared to 1.3 per cent for men.

Dr. Shane Oliver, Chief Economist at AMP, noted: “The September quarter Financy Women’s Index highlights increasing evidence that females are seeing more sensitivity to swings in economic activity than men, possibly reflecting their part-time status in discretionary services sectors. This is a big turnaround from times past when it was men in manufacturing and construction who were most vulnerable. The key is to enable more women to work full-time and in more diverse parts of the economy, so they are not as vulnerable to the vagaries of the economic cycle.”

“Over the past decade, when gross domestic product (GDP) growth has been stronger, we have seen improved employment growth for both men and women,” said Bianca Hartge-Hazelman, CEO of Financy.

“This has also been correlated with progress in economic equality, as measured by the FWX.

“But whenever GDP has weakened, we have tended to see female employment behave more volatile than male and this has recently led to declines in the FWX. It’s also important to note that FWX has been relatively flat since 2020.”

Victoria’s Minister for Women and Jobs, Natalie Hutchins, said: “Interest rates, unstable political environments in countries like the United States, and global wars are increasing the cost of living, with women often paying the price.”

The Index shows Australia’s path to gender equality in the workforce faces significant hurdles, with a 26.8-year wait for equality in Employment and a 20.6-year wait in Underemployment. The best case scenario for equality is 5.1 years via ASX 200 Board Leadership, followed by a 17.7 year wait in Superannuation savings. The wait for pay parity, and indeed the median overall timeframe for gender equality to be achieved, is 22.1 years – a generation away.

“News of Donald Trump’s return to the US presidency has come as a shock to many with fears that it will lead to a setback in progress on gender equity and more broadly in relation to diversity, equity, and inclusion,” said Dr Oliver.

“While Americans who switched sides were motivated by ‘cost of living’ concerns rather than rejecting progress on issues like gender equity, it does run the risk that gender equity will be less of a focus for the next few years in the US. We need to guard against this happening in Australia as well, to the extent that US trends often show up in Australia with a lag. The good news is that through the last Trump administration, the FWX continued to trend up.”

“Whilst we have seen female wages grow slightly faster than male wages, and this helped deliver a record breaking improvement in the FWX Gender Pay Gap sub-index, the fact that women still earn 11.5 per cent on average less than men, makes it all the more difficult to keep up with ongoing cost of living pressures, particularly those that relate to housing, groceries and utilities,” said Hartge-Hazelman.

“Compounding this is the fact that women tend to occupy the most insecure forms of employment, such as part-time and casual roles, as these are often the job types that businesses pull back on when conditions get more difficult,” she said.

“The FWX report underscores the need for policymakers and businesses to prioritize gender equality, even amid economic challenges.

“Encouraging greater flexibility in full-time work and ensuring women’s jobs are not disproportionately affected by economic pressures are crucial steps forward,” said Hartge-Hazelman.

Natalie Previtera CEO of NGS Super added: “The cost-of-living crisis is a stark reminder of the importance of financial independence for women. As leaders, employers, and policymakers, we all have a role to play in creating workplaces where women can thrive, even in the face of economic challenges. By prioritising equity and inclusion, we can build a stronger, fairer Australia for everyone”.

The Financy Women’s Index TM (FWX) is a quarterly measurement of the economic progress of women and timeframes to gender equality in Australia. The FWX is produced by Financy, which is a data insights and tech company that provides the IMPACTER Diversity and Inclusion platform. The Women’s Index is supported by an Advisory Committee which includes Dr Shane Oliver, Simone Cheung, Roger Wilkins, Leonora Risse, Bruce Hockman, Rhiannon Yetsenga and Nicki Hutley. The Index is proudly sponsored by NGS Super, the Ecstra Foundation, Aspire Planning, Seven Consulting, HeirWealth and PritchittBland Communications.

The post Australia women paying the price for economic weakness appeared first on AdviserVoice.

Bianca Hartge-Hazelman

Key points

• Progress to gender equality stalled in the June quarter of 2024 with the FWX slipping by 0.2 points to 77.5 points out of a score of 100.
• A record improvement for the Gender Pay Gap and a steady result for ASX 200 Board Leadership helped to offset much of the weakness in Employment and the Underemployment Rate.
• Overall, the Index is tracking 2 points higher for the year to date and shows a long-term trend in progress towards gender financial equality.
• As we look at the progress towards gender financial equality, it’s interesting to note that whilst gender norms remain challenging in the workforce, and indeed a major barrier to closing gender gaps, women’s sport provides us with good reason for optimism as evidenced most recently by the Paris Olympics.
• FWX Timeframes to gender equality include a best case 5.2 years for ASX 200 Board Leadership, 17.7 years in Superannuation, 20.2 years in Underemployment, 22.6 years in the Gender Pay Gap (as the median timeframe to gender equality) and 24.6 years in Employment, 45.5 years in Unpaid Work and, a very pessimistic, 389.2 years in Education.

Australia’s progress toward gender financial equality slows in the June quarter

Australia needs to do more to challenge outdated gender norms, which continue to contribute to a “two steps forward, one step back” rate of progress on gender financial equality, according to the latest Financy Women’s Index (FWX).

The FWX, which tracks timeframes to economic equality every quarter, slipped to 77.5 points in the June quarter of 2024, down by 0.2 points from a revised 77.7 points in March. Despite the decline, the Index has improved over the past 12 months, gaining 2.36 points from 74.8 points in June 2023.

Financy founder and CEO Bianca Hartge-Hazelman notes that despite the gains women are making in the labour market participation and on the sporting field as evidenced by the Paris Olympics, persistent gender norms are still holding back female progress relative to men.

“Similar to what we saw during the Coronavirus pandemic, women are once again bearing the brunt of economic uncertainty largely because they still tend to occupy more flexible and insecure forms of employment, such as part-time and casual roles,” Ms. Hartge-Hazelman says.

“As business conditions weaken, these roles are more likely to be adjusted, with hours reduced to the detriment of the female workforce.”

Natalie Previtera CEO of NGS Super, notes that there is no way to achieve equality without women continuing to take up the mantle of visible leadership – on the field, in the boardroom, in financial and executive roles.

“It’s important to have a voice and lead the charge from the front. As we’ve seen with the Matildas and our female Olympians, women’s success in their chosen field has the power to inspire a nation.”

Dr Shane Oliver, Chief Economist at AMP says the areas desperately requiring improvement include the lower paying career choices young women make when they start their tertiary education relative to men and the ongoing discrepancy in unpaid work around the home.

“Both require attitudinal change,” he says. “Ideally this should start with what we tell our young girls (that they can do whatever they want, and certain jobs pay a lot more than others) and young boys (that girls are their equal, they should expect to share the load around the home and their gender equity benefits all of us).”

The headline FWX score for the June quarter was buoyed by a record-breaking improvement in the national gender pay gap, which fell to 11.5% in May as reported in August. This improvement, reflecting increased wages for early childhood educators and aged care workers, helped lift the FWX Gender Pay Gap sub-index to 88.5 points, up from 88 points in March.

However, this progress was overshadowed by setbacks in employment outcomes for women relative to men, particularly in monthly hours worked and underemployment. The FWX Employment sub-index, which reflects the gender gap in monthly hours worked, fell to 75.4 points, down from 75.6 in March, as female hours declined by 0.3%, compared to a 0.1% decline for men.

The FWX Underemployment sub-index also worsened in the June quarter, dropping to 71.2 points from 72.2 in March. The female underemployment rate increased by one percentage point to 7.71%, while the male rate improved, dropping by 6 percentage points to 5.22%.

Looking ahead: timeframes to Ggender equality

Australia’s path to gender equality remains long, with the FWX highlighting varying timeframes across key indicators.

• ASX 200 Board leadership: Gender equality is expected by 2030, with a current wait time of 5.2 years, down from 5.7 years 12 months ago.
• Gender pay gap: Equality is expected by 2047 with a 22.6 years wait to close this gap, an improvement from 24.3 years in June 2023.
• Superannuation: Equality is expected by 2042 with a wait of 17.7-years. New data is awaited to update these figures.
• Underemployment rate: Equality is expected by 2024 with a 20.2-year wait.
• Employment: Equality is expected by 2049 with a 24.6-year wait.
• Unpaid Work: Equality is expected by 2070 with a 45.5 year wait.
• Education: Equality is expected by 2414 with little progress being made and a troubling wait of 389.2 years^[1].

“As a general reflection, it’s incredibly frustrating that we see these great moments, such as in sport, at the same time we see the repetition of entrenched norms that see women bear the burden of tougher economic times,” says Nicki Hutley, consulting economist.

“But one must continue to hope that the big moments will change the norms, so the everyday standards improve.”

While Australia has made significant strides in closing the gender pay gap, more work is needed to address the persistent gender norms that continue to hold back progress in other areas. As economic conditions remain uncertain, it is crucial that policymakers and businesses prioritize gender equality in all aspects of the labour market to ensure sustained progress.

Ms. Hartge-Hazelman remains cautiously optimistic, citing the success of Australian women in the Paris Olympics as a positive sign.

“These wins are impressive, and they help to shift the narrative and gender norms over the longer term, which we believe should, in turn, drive greater progress across all of our indicators,” she says.

Read the report.

——–

Notes:
[1] Source: Financy Sept 2024

Bianca Hartge-Hazelman

The Financy Women’s Index (FWX) rose to 78.1 points in the September quarter, reflecting further, albeit small, advancement towards economic equality in Australia.

The result is the best gain in two years and cements a correction in women’s financial progress following a decline associated with the Coronavirus pandemic.

The Index rose 2 per cent (1.5 points) to 78.1 points in the September quarter from 76.6 points out of 100 in the June quarter, helped by an improvement in female underemployment and a shift among women studying educational fields linked to higher expected career earnings.

Bianca Hartge-Hazelman, founder of Financy says the Women’s Index is now 1.9 points higher for 2023, which is good news despite the challenges of a slowing economic environment.

“During the peak of the pandemic, the underlying data captured in the Index was volatile and if we compare where we are today to September 2020, the Index is less than 1 point (0.84) higher – a poor result.

“That said, if we look at economic equality prior to the pandemic in December 2019, the Index is nearly 5 points higher today than it was then.  This suggests a correction in the Index to a more reliable pattern of progress, but the economic environment remains concerning for both female and male employment.”

A slowing economy is behind a bit of a switch from full-time to part-time employment growth by employers. This has been particularly noticeable in female underemployment.

The female underemployment rate improved (7.36 per cent) in the September quarter as more women worked part-time. The male underemployment rate (5.59 per cent) worsened – this helped to narrow the FWX Underemployment sub-index. The number of monthly hours worked by women in the September quarter dipped only just (-0. l per cent) compared to a bigger fall of -1.3 per cent for men.

In Education, Information Technology remains the highest paying educational area for women and has seen female enrolment growth continue to outpace male. Despite this, female enrolments stand at 21,006, about a third less than the 73,716 for male.

Management and Commerce, ranks as the third top paying area for women and female enrolment growth is also higher than it is for male.

Overall, the combination of sustained gains across all FWX indicators comes at a time of increased focus on gender equity policy and research.

“Domestically, we’ve seen the Women’s Economic Equality Taskforce Final report handed to the Australian government and, offshore, the awarding of the Nobel Prize in economics to Professor Claudia Goldin for her research that has raised the profile of the gender pay gap and what is behind it – so it’s been a busy period of gender equity headlines and impact,” says Hartge-Hazelman

“What’s needed now is for the tide to turn from all this awareness raising on economic inequality to an environment of collective action by government, companies, and individuals to accelerate progress to equality,” she says.

“The Financy Women’s Index shows we clearly still have a long way to go to achieve gender financial equality,” said Dr Shane Oliver chief economist AMP.

“This is particularly so in areas like the expected earnings flowing from the education choices women make and in unpaid work.

“But the good news is that the Index has improved significantly this year with strong progress in women’s board representation,” he says.

Dr Tracey West, financial education manager at Ecstra Foundation says that critical to closing the financial knowledge deficit and empowering women to make informed financial decisions is boosting financial education in schools.

“The call to action from the Women’s Economic Equality Taskforce Final report, which was released in October, to recommend immediate action on financial literacy in the classroom recognises the important role schools play in developing this critical life skill,” she says.

Natalie Previtera CEO of NGS Super added that it’s important we continue to think about gender financial equality beyond women’s years in the workforce.

“We know that women are more likely to experience poverty in retirement than men. An ASFA report found that the average superannuation balance for women aged 60-64 is $70,691 less than that of men,” she says.

Chart 1: Changes in years to financial gender equality

Source: Financy Women’s Index September 2023

Note: Due to significant changes and volatility in the underlying datasets used to calculate the timeframe to equality (Census, uCube and VOCSTATS) we are reassessing our current methodology (which uses a line of best fit approach) and will be updating this figure in the December quarter 2023 report, due for release in March 2024.

Chart 2: Changes in FWX quarterly performance

Source: Financy Women’s Index September 2023

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Bianca Hartge-Hazelman

The Financy Women’s Index (FWX) rose to 78.1 points in the September quarter, reflecting further, albeit small, advancement towards economic equality in Australia.

The result is the best gain in two years and cements a correction in women’s financial progress following a decline associated with the Coronavirus pandemic.

The Index rose 2 per cent (1.5 points) to 78.1 points in the September quarter from 76.6 points out of 100 in the June quarter, helped by an improvement in female underemployment and a shift among women studying educational fields linked to higher expected career earnings.

Bianca Hartge-Hazelman, founder of Financy says the Women’s Index is now 1.9 points higher for 2023, which is good news despite the challenges of a slowing economic environment.

“During the peak of the pandemic, the underlying data captured in the Index was volatile and if we compare where we are today to September 2020, the Index is less than 1 point (0.84) higher – a poor result.

“That said, if we look at economic equality prior to the pandemic in December 2019, the Index is nearly 5 points higher today than it was then.  This suggests a correction in the Index to a more reliable pattern of progress, but the economic environment remains concerning for both female and male employment.”

A slowing economy is behind a bit of a switch from full-time to part-time employment growth by employers. This has been particularly noticeable in female underemployment.

The female underemployment rate improved (7.36 per cent) in the September quarter as more women worked part-time. The male underemployment rate (5.59 per cent) worsened – this helped to narrow the FWX Underemployment sub-index. The number of monthly hours worked by women in the September quarter dipped only just (-0. l per cent) compared to a bigger fall of -1.3 per cent for men.

In Education, Information Technology remains the highest paying educational area for women and has seen female enrolment growth continue to outpace male. Despite this, female enrolments stand at 21,006, about a third less than the 73,716 for male.

Management and Commerce, ranks as the third top paying area for women and female enrolment growth is also higher than it is for male.

Overall, the combination of sustained gains across all FWX indicators comes at a time of increased focus on gender equity policy and research.

“Domestically, we’ve seen the Women’s Economic Equality Taskforce Final report handed to the Australian government and, offshore, the awarding of the Nobel Prize in economics to Professor Claudia Goldin for her research that has raised the profile of the gender pay gap and what is behind it – so it’s been a busy period of gender equity headlines and impact,” says Hartge-Hazelman

“What’s needed now is for the tide to turn from all this awareness raising on economic inequality to an environment of collective action by government, companies, and individuals to accelerate progress to equality,” she says.

“The Financy Women’s Index shows we clearly still have a long way to go to achieve gender financial equality,” said Dr Shane Oliver chief economist AMP.

“This is particularly so in areas like the expected earnings flowing from the education choices women make and in unpaid work.

“But the good news is that the Index has improved significantly this year with strong progress in women’s board representation,” he says.

Dr Tracey West, financial education manager at Ecstra Foundation says that critical to closing the financial knowledge deficit and empowering women to make informed financial decisions is boosting financial education in schools.

“The call to action from the Women’s Economic Equality Taskforce Final report, which was released in October, to recommend immediate action on financial literacy in the classroom recognises the important role schools play in developing this critical life skill,” she says.

Natalie Previtera CEO of NGS Super added that it’s important we continue to think about gender financial equality beyond women’s years in the workforce.

“We know that women are more likely to experience poverty in retirement than men. An ASFA report found that the average superannuation balance for women aged 60-64 is $70,691 less than that of men,” she says.

Chart 1: Changes in years to financial gender equality

Source: Financy Women’s Index September 2023

Note: Due to significant changes and volatility in the underlying datasets used to calculate the timeframe to equality (Census, uCube and VOCSTATS) we are reassessing our current methodology (which uses a line of best fit approach) and will be updating this figure in the December quarter 2023 report, due for release in March 2024.

Chart 2: Changes in FWX quarterly performance

Source: Financy Women’s Index September 2023

The post Economic equality improves the most in two years  amid correction from Coronavirus pandemic appeared first on AdviserVoice.

Bianca Hartge-Hazelman

Key points:

• Women’s Index rose 0.2 points in the June qtr to 76.5 points with a recovery in gender financial equality progress helped by improvements in the gender gap and ASX 200 Board Leadership
• 5.7 year wait for equality in Board Leadership – women account for 36.4%
  of ASX 200 board directors.
• 24.3 year wait for the Gender Pay Gap to close – the gap has improved
  to 13% in June qtr but positive momentum still not by enough
  to change timeframes to equality.
• Australia is seeing a changing of social attitudes helped by the gender-lens impacts of the Barbie movie and Matildas World Cup success.
• Despite positive influences, primary care responsibilities are still
  holding women back from working to their desired potential in a
  higher cost of living environment.

Progress to gender financial equality is back on the front foot after two successive quarters in decline, helped by record advancements in the gender pay gap and number of women appointed to ASX 200 board positions, according to the Financy Women’s Index (FWX).

Bianca Hartge-Hazelman, founder of Financy, says the result signals a return of overall momentum in progress among the 7 indicators measured in the Women’s Index and comes as Australia undergoes a broader cultural shift helped by the influence of what can only be described as the Barbie and Matildas effect.

“It’s exciting to see the gender pay gap shrink to a record low at a time when there has never been greater media focus on the pay gap, particularly in light of the Barbie movie phenomenon and the FIFA Women’s World Cup,” she said.

The FWX rose by 0.2 points to 76.5 points in the June quarter of 2023, up from a revised 76.2 points in March. The Index is also 0.4 points higher for the year to date.

The most impressive gain was in the number of women appointed to ASX 200 directorships, which rose to 36.4% during the quarter compared to 36% in March. This helped the FWX Board Leadership sub-index gain by 3.4 points and was the most impressive improvement among all the FWX sub-indexes.

The gender pay gap also fell to a historic low of 13% during the quarter – as reflected in May 2023 data as average weekly wages for women rose by 2% compared to 1.6% for men, helping to narrow the disparity. This helped the gender pay gap sub-index add 1.1 points and is an improvement on the 13.3% pay gap reported at the start of this year.

With Equal Pay Day on August 25^th this week, the gender pay gap data shows that full-time working women earn $252 less than men each week and that Australian women will have to work an extra 56 days to make up for the difference, according to the Workplace Gender Equality Agency.

Despite improved wages growth for women, female dominated industries like Health Care and Social Assistance are underperforming male dominated sectors like Construction on average wages growth (3.4% v 3.8% respectively).

Employment was the only FWX indicator where progress declined as the growth rate in monthly hours worked by men grew by 1.5% in June compared to only 0.7% for women.

Women also struggled to find work in part-time employment more so than men, with the biggest job cuts in male dominated areas including Construction (-43%) and Electricity, Gas, Water and Waste Services (-37%) and Transport, Postal and Warehousing -(25%).

“While the FWX is showing more positive signs this quarter and as we come off the highs of Barbie and the Matildas, the real test will be how women fare as the cost-of-living crisis deepens and economic growth slows,” said Simone Cheung partner Deloitte Access Economics.

“The question of whether the modest improvements in the FWX are enough of a buffer for women as we enter a period of growing economic uncertainty remains to be seen,” she said.

Will the Barbie and Matildas effect help gender financial equality?

The Barbie and Matildas effect could help support a resurgence in FWX progress towards gender equality, building on this latest June quarter result.

Hartge-Hazelman said that “in many ways the events that are unfolding at the moment are similar to the 2017/2018 #MeToo and Times Up movements in terms of their ability to challenge and change social attitudes. However the big difference is that the Barbie and Matildas effect has been indicative of positive cultural sentiment through entertainment.”

In the two years post #MeToo and Times Up, the FWX experienced its fastest pace of progress in 2019 and 2020, up 3%, then 4%, before the impact of the Coronavirus pandemic disrupted momentum in 2021 (1%) and 2022 (-1%). The number of women occupying ASX 200 board positions also improved by 14% to 29.7% from 26% in the year to December 2018 – the biggest improvement since 2012.

“Barbie has raised awareness around gender equality to a whole new level but in a very positive way and the Matilda’s showed women’s’ sport can be just as popular as men’s sport,” said Dr Shane Oliver chief economist AMP Capital.

“We just have to keep building on these favourable events to make sure that they are turned into lasting change in reducing gender financial inequality,” he said.

Natalie Previtera, CEO of NGS Super added that CEOs and industry leaders can help accelerate the cultural shift by taking greater action.

“Industry leaders have a unique vantage point to be potential agents of transformation and change. We just need to be willing to do it.

“Because companies shape practices and norms that can have broader societal effects. For example, gender balance on Boards and in management, offering flexible work options, as well as access to training and development and the amount of parental leave available to employees are just some of the practices that can make a difference,” said Previtera.

The outlook for gender equality timeframes in Australia

Progress is slowly happening with incremental reductions in the time it will take to achieve gender equality in each of the 7 FWX indicators.

Chart: Changes in years to financial gender equality

Source: Financy Women’s Index March 2023

Changes in timeframes to gender equality

Board Leadership continues to be the best performing area of the FWX, and we are increasingly confident of seeing equality on ASX 200 boards by 2030. Years to equality fell to 5.7 in June, from 5.8 in the March quarter.

The Gender Pay Gap years to equality is 24.3 years. This is a slightly worse result than the 24.2 years in the June quarter 2023. But the recent improvement in the gender pay gap to 13% in June provides hope that this should start to come down if that change continues.

Employment improved its time to equality helped by a legacy of more positive momentum in the annual growth rate. Time to equality fell to 26.8 years in June, from 27.1 years in December.

The time to equality in Underemployment worsened in the June quarter as the annual rate of progress in this area declined further despite the recent narrowing of the gender gap. The years to equality rose to 21.2 years, from 19.8 years in March.

Unchanged in timeframes to gender equality

Education (and Expected Earnings) has an alarming time frame to equality of 139 years.

The fields of study selected by women are less linked to higher potential earnings and the pace of change in this area is extremely slow moving. Underlying data released annually.

Unpaid Work has a time to equality of 44 years in 2021, as reported in 2022, down from 59 years in 2020. Whilst 44 years is still a long time to wait for equality in housework and childcare, the improvement is due to men increasing unpaid work hours. Underlying data released annually.

Superannuation experienced a reduced time frame in the gender gap of median lifetime balance to 19 years, based on the latest available 2019 data, compared to 33 years based on the previous data which captures the 2017 financial year. Underlying data released every two years.

Bianca Hartge-Hazelman

Key points

• 76.1 points – The Financy Women’s Index (FWX) slipped 0.1 point in the March quarter 2023 amid cost of living pressures and marking yet another setback in progress to gender financial equality.
• 5.8-year wait for equality in Board leadership – Improvement in the March quarter, with women now accounting for 36 per cent of ASX 200 board directors.
• 20-year wait for equality in underemployment – Timeframes increased with fewer Australian women working to their desired potential in March quarter 2023.
• 24-year wait for the gender pay gap to close – Unchanged since December 2022 quarter.
• May Budget welcomed on women but still missed opportunities: superannuation on paid parental leave and time targets on gender equality.

Progress towards financial gender equality has faltered for the second quarter in a row as the gender gap in the underemployment rate widened, the Financy Women’s Index (FWX) for the March quarter 2023 shows.

The FWX fell to 76.1 points in March, down from 76.2 points out of 100 in December as an increasing female underemployment rate, relative to male, took the shine off quarterly improvements in female monthly hours worked and greater gender diversity on ASX 200 Boards.

Bianca Hartge-Hazelman, founder of Financy, says that as interest rates have been climbing, so too has the female underemployment rate.

“The growing underemployment comes despite an all-time high in the number of monthly hours worked by women, helped by growth in female-dominated services industries such as Retail Trade, Education and Training and Other Services,” she says.

“We appear to be seeing a growing desire, or perhaps financial need, among women to work more hours but they are not able to fully achieve their employment requirements.

“Given that the gender gap in underemployment rate has widened in an environment of higher interest rates for the past two quarters, the risk is that this is not an aberration and that this may continue, resulting in higher female unemployment and a greater financial strain on women, particularly those on low incomes or single parent families.

“This would be a blow to the financial progress of Australian women and cement the view that they are the shock absorbers of high cost of living pressures, more than men. This could weigh on the annual pace of progress towards gender equality beyond the next June quarter,” said Hartge-Hazelman.

Will the May Budget help gender financial equality?

Dr Shane Oliver, chief economist AMP Capital, said he would have liked to have seen more in the Federal Budget to improve gender equality in a fundamental way.

“Paying super on paid parental leave or – even better – measures to encourage more women into courses that lead to higher pay, would be considered fundamental,” he said.

Natalie Previtera, Acting CEO, NGS Super noted that while Australia has made some big strides on the journey towards financial equity for women, there is a long way to go.

“Super on paid parental leave, access to affordable childcare, more flexible working arrangements for all genders, a greater emphasis on workplace cultures that supports both parents taking on caring responsibilities as well as greater transparency in wages, are some of the barriers we still need to crack,” said Ms Previtera.

Professor Roger Wilkins, Deputy Director of the HILDA Survey, said: “Overall I think Labor is doing quite a bit and has flagged further measures going forward, such as improving the child support system and working to reduce domestic violence.

“That said, I’m not convinced the announced changes to Parental Leave Payment (and removal of Dad and Partner Pay) are positive for women. I think they will end up (unintentionally) reinforcing the notion that parenting is women’s work. To break the cycle, we probably need parenting benefits that only fathers can access – which superficially seems counterintuitive,” he said.

The outlook for gender equality timeframes in Australia

Progress is slowly happening, with the biggest challenges in those areas affected by persistent gender norms such as Education and Unpaid work.

Chart: Changes in years to financial gender equality

Source: Financy Women’s Index March 2023

Ms Hartge-Hazelman says that Education (and Expected Earnings) has a worrying time frame to equality, of 139 years.

“Why? The fields of study selected by women are less linked to higher potential earnings and the pace of change in this area is extremely slow moving,” she says.

“139 years to achieve timeframe to equality in the education fields women chose is alarming,” said Annick Donat, CEO of Clime Investment Management.

“Many of these qualifications shape the future of human lives for generations such as nursing, teaching, childcare, and yet they hold less financial ‘value’.  How we measure value needs a new perspective,” said Ms Donat.

Looking at the other areas measured by the Index, the median timeframe to equality is represented by the Gender Pay Gap, at 24 years.

This is a slightly worse result than the 22 years in the December 2021 quarter. However, the recent improvement in the gender pay gap to 13.3 per cent from 14.1 per cent in the December quarter provides hope that this should start to come down if that change continues.

Unpaid Work has a time frame to equality of 44 years in 2021, as reported in 2022, down from 59 years in 2020. The improvement is due to men increasing their unpaid work hours, but for women there’s been no change.

The time to equality in Underemployment also worsened in the March quarter as the underlying gender gap widened. It rose to 20 years, up from 18.5 in December 2022.

Superannuation experienced a reduced time frame in the gender gap of median lifetime balance, down to 19 years, from 33 years based on the latest reportable data which captures the 2019 financial year.

Employment improved the time to equality, helped by those improved monthly hours worked by women. Time to equality fell to 27.5 years in March, from 28 years last quarter.

Board Leadership is the best performing area and equality is expected on ASX 200 boards by 2030. The number of women appointed to ASX 200 directorships rose to 36 per cent in the March period compared to 35.5 per cent in December 2022.