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

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Bianca Hartge-Hazelman

Key results

• The Financy Women’s Index (FWX) finished 2021 up 1.6% to 72.3 points with women’s financial progress and time to economic equality better than expected.
• The key drivers of the FWX in 2021 included the closing of the gender gaps in employment, ASX 200 board positions and
  unpaid work.
• However there was a 2.2% drop in the Index during the December quarter, weighed down by a worsening gender pay gap.
• The timeframe to economic gender equality now stands at 59 years, down from a revised 76 years based on the worst performing area – unpaid work.

There are signs that the Coronavirus pandemic is creating a structural shift in gender equality as pressure eases on some of the key barriers to women’s financial progress in 2021, the Financy Women’s Index shows.

Bianca Hartge-Hazelman, author of the Financy Women’s Index, said that 2022 presents a once-in-a-lifetime opportunity for Australia to consolidate the gains of 2021 towards economic equality for women.

The FWX finished 1.6% higher at 72.3 points compared to 71.2 points in December 2020, aided by a closing of the gender gaps in employment, ASX 200 board positions and unpaid work.

It will now take 59 years to achieve financial gender equality in Australia, down from a revised 76 years in 2020, based on the worst performing area of progress – unpaid work.

Data suggests that more flexible work arrangements and better division of unpaid labour has enabled women to spend less time on unpaid work overall, whilst men are spending slightly more of their overall time in this area.

“The significant reduction in the timeframes to equality has surprised the FWX Advisory Board because we expected that the unpaid workloads of women had probably increased as a result of home-schooling and working from home during the lockdowns,” said Ms Hartge-Hazelman.

“But in fact, women appear to have been working more than ever in paid employment, although for less financial reward than men.

“While it is encouraging to see a greater balance in paid and unpaid work between women and men, if this is to be a long-term a structural shift then it is vital that we also see female workforce earnings keep up, especially in those hard-hit services areas like Health,” said Mrs Hartge-Hazelman.

This quarter, the Financy Women’s Index sheds some light on one of the big questions to have emerged during COVID-19 – who bore the brunt of the unpaid work?

“The unpaid work index remains one the most important indicators of women’s progress, with the division of domestic tasks so closely tied to gender norms,” said Rhiannon Yetsenga, economist at Deloitte Access Economics.

“The pandemic and associated lockdowns have shown a path towards greater gender equality through more flexible working, but further cultural and structural change is required if we want to enable progress beyond the modest improvements seen this quarter,” said Ms Yetsenga.

Despite the annual FWX improvement, a disappointing December quarter weighed on the result, with a 2.2% drop driven by a widening in the gender pay gap (14.2%).

This was the only area of the Index which failed to improve over the year.

It acted as a drag on the annual rate of progress towards women’s economic equality, bringing it to about half of that recorded for the 2020 calendar year (1.6% versus 3%.)

“It’s frustrating to learn that, despite living in a wealthy, well-educated society in the 21st century, the Financy Women’s Index estimates it will take close to 22 years to close the gender pay gap,” said Effie Zahos, independent director InvestSMART.

“Right now, Australia is facing a skills shortage, and there may never be a better time for women to exercise their workplace clout and be paid what they are worth,” said Ms Zahos.

Among the other key findings on women’s economic progress:

• the gender gap in underemployment is now the smallest it has ever been, reflecting that strong labour market conditions combined with greater work flexibility during the pandemic has improved employment opportunities for Australian women.
• there was also an improvement in the number of monthly hours worked by women (6% gain versus a 5% gain for men in the December quarter).
• the number of women on ASX 200 boards increased over the latest quarter to 34.5%, as of January 31, according to the Australian Institute of Company Directors.

Nicki Hutley independent economist said she is “optimistic” that changes in the unpaid work balance will stick after the pandemic passes.

“There is still a lot of work to do and it’s concerning that some areas have worsened, especially the gap in graduate salaries. A gap right from the start tends to expand over the years and sets up a lifetime of inequality,” she said.

The remaining sub-indices of the Women’s Index such as Superannuation and Education will be updated in the March quarter of 2022.

Dr Shane Oliver, chief economist AMP said Australia needs to work harder on to getting gender equality right.

“The pandemic and associated lockdowns have shown a path towards greater gender equality through more flexible working – the key is for business, governments and workers to grasp the opportunity and push forward long after we leave the pandemic behind,” said Dr Oliver.

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