Bianca Hartge-Hazelman

Women’s progress to financial equality with men suffered a setback in the June quarter, as COVID shock factors put the brakes on the female-led recovery at the start of 2021, the latest Financy Women’s Index (FWX) June quarter report shows.

While the FWX rose by 0.9% to 72.2 points in the June quarter, the pace of progress is slower than the 1.06% recorded in the March quarter 2021.

The June quarter result was helped by a fresh record high in the number of women occupying ASX 200 board positions to 33.5% and a narrowing of the gender gap in the underemployment rate.

However digging deeper into the closing of the gender gap in the underemployment rate, it appears less affected by actual progress for women and instead reflects more women opting out of work.

“While the long-term trend for women’s economic progress is still one of improvement, as we continue to combat the pandemic, women remain particularly vulnerable to lockdowns and the disruptions from public health and social distancing orders,” said Financy CEO Bianca Hartge-Hazelman.

“The concern is that the longer the pandemic continues, unpaid work seems to rise and the harder it is for many women to participate in the workforce to their full potential,” said Ms Hartge-Hazelman.

Unlike any other economic crisis in Australia’s history, the fallout from the COVID-pandemic has exacerbated the financial inequalities faced by women and the most vulnerable.

In the March quarter of 2021, the Australian economy was picking up, helped by a female-led employment recovery in sectors most hit by the pandemic such as Retail Trade and Food and Accommodation Services.

However, the recovery started to come off the boil in June and the number of monthly hours worked by females fell by 2.3%, almost five times that seen among males and contrasting to a 4.6% gain for women in the March quarter.

The gender pay gap also widened to 14.2% from 13.4%, reflecting the biggest dollar difference ($261) between men and women’s full-time weekly wages since 2016.

“The pink recession, she-cession, pink-collar recession – whatever you want to call it, the impact of COVID-19 has not been gender-neutral,” said Deloitte Access Economics partner, Simone Cheung.

“We continue to see Australia’s key economic indicators bounce around as we cycle in and out of lockdowns and varying degrees of restrictions, and women have tended to be more impacted by the pandemic.

“Interestingly, this release of the Financy Women’s Index shows a big improvement in the gender underemployment gap. But digging a little deeper, there were less women in part-time work who preferred more hours. This means women are not only impacted by economic cycles, but they are also more likely to willingly opt out of the workforce or reduce work hours due to non-economic reasons,” said Ms Cheung.

“Why? Women are much more likely to stop looking for work due to childcare and other family considerations or caring responsibilities compared to men.”

While the FWX rose slightly in the June quarter, the coronavirus pandemic and associated lockdowns appear to be continuing to exacerbate existing financial inequalities between men and women in critical areas like pay and hours worked.

AMP Chief Economist Shane Oliver said that “even abstracting from the impact of the pandemic we have a long way to go before women attain financial equality with men.

“In some ways the pandemic – by accelerating progress towards more flexible working – may ultimately help progress towards financial equality for women. But at this stage we are still a long way from that,” said Dr Oliver.

In the 12-months to date, the FWX is down 1% from a record high of 72.9 points in June 2020. But when comparing the FWX score to December 2019, progress is up a much more positive 4%.

The Women’s Index June report supports the argument for immediate attention at a government and business level to address long-standing financial inequalities that directly impact the most vulnerable, particularly women, during times of crisis.

Caroline Stewart, CEO of Ecstra Foundation observed that “financial inequality remains a major obstacle to the progress of women, including women in caring roles.

“Ecstra strongly supports the publication of Financy Index, which highlights the challenges women face in relation to gender equality and financial security,” said Ms Stewart.

It will take at least 21 years for parity to be achieved in the gender pay gap, at least 31 in employment, 16 years in the underemployment rate and 7 years for 50/50 gender diversity to be achieved on ASX 200 boards.

Overall, the most significant obstacle relates to unpaid work. It will take 101 years before equality is achieved in this area and before we can say equality has been achieved across all areas of financial inequality measured in the FWX.

The post Women’s financial progress recovery fractured and slowing on COVID shock appeared first on AdviserVoice.

Bianca Hartge-Hazelman

Key points:

• The Financy Women’s Index rose 0.7 points to 71.6 points in the March quarter, shaking off the worst quarter in eight years for women’s financial progress in December 2020.
• Year-on-year the Women’s Index rose 1.8 points or 0.8%, which is the strongest start to a calendar year since 2018.
• The score was helped by a strong recovery to the COVID-19 setback in female employment and a further improvement in the number of women occupying directorships on ASX 200 companies.
• The timeframe to achieving total gender equality in Australia remains at 101 years based on the worst performing sub-index, unpaid work.
• The timeframe to achieving gender equality in employment (sub-index) fell to 30 years in the March quarter, down from 34 a year earlier – the slowest annual growth rate since 2018.

The financial progress of Australian women appears back on track thanks to a female-led job’s recovery from the Coronavirus pandemic but there is still a lot of catch-up to be done when it comes to achieving gender equality.

Unlike past economic downturns, Australian women are helping to drive the recovery with workforce participation at record highs and the fastest rate of improvement in over 40 years in the number of monthly hours worked by any gender in the March quarter.

The Financy Women’s Index rose by 0.7 points to a revised 71.6 points in the March quarter, and is up 1.8 points on March 2020 – the best start to a calendar year since 2018.

Women’s Index founder Bianca Hartge-Hazelman has welcomed the result with cautious optimism.

“It’s fantastic to see that female employment is bouncing back in many of the sectors hardest hit by the pandemic shutdowns,” she said.

“However when we look at what this means for gender equality in employment, the rebound shaved 4 years off the now 30 year timeframe for achieving that. While it’s a step in the right direction, it’s actually reflective of the slowest pace of annual progress since 2018.

The March quarter result has been driven by new data updates across the three sub-index areas: employment, underemployment and leadership. The Index also captures the latest available data updates on the gender gaps in pay, superannuation, unpaid work and fields of education linked to career earnings.

Employment data shows a record increase in female workforce participation, as well as improvement in the underemployment rate gender gap and a fresh high in women holding ASX 200 board directorships.

The combined result suggests that women are experiencing a somewhat faster employment recovery from the jobs fallout caused by the Coronavirus pandemic than men, helped by a significant rebound in the sectors hardest hit such as the female-dominated Retail Trade and Accommodation and Food Services.

Deloitte Access Economics partner, Simone Cheung, said that sectors with high female representation such as Health and Social Services have also grown significantly over the pandemic. On the other hand, male-dominated industries such as construction have seen a drop in employment.

“The question remains: is this women-led recovery in jobs a correction, or is it a sign of things to come? We will have to wait and see,” she said.

“What we do next will be critical, and will determine whether this momentum is maintained, or whether things reverts to the pre-COVID norm.”

The Index also found that younger women and those in the most common age group for entering parenthood are yet to see a full recovery in the full-time employment numbers. It is a trend we are also seeing among younger men.

AMP Capital chief economist, Shane Oliver said while “it’s excellent news to see the Financy Women’s Index resume its rising trend in the March quarter, in most areas we remain many years and in some cases decades away from achieving gender financial equality.”

The timeframe for achieving total gender equality stands at 101 years, based on the worst performing sub-index (unpaid work) of the Women’s Index.

In terms of other sub-indexes and achieving gender equality in those areas, the Women’s Index estimates it will now take 30 years to achieve equality employment, down from 34 years in March 2020.

The timeframe to achieving gender equality in underemployment remains around 17 years and it is likely to take 7 years of sustained progress for complete gender diversity to be achieved on ASX 200 boards.

The gender gap in unpaid work seemed to worsen through the pandemic; however the crisis has also showed a way forward to help address this problem in a way that is beneficial for both males and females and at the same time good for productivity.

“The pandemic has showed that it’s possible to work from home in a more flexible way without negatively impacting productivity,” Dr Oliver said.

“And more working from home should further help boost female workforce participation thereby reducing their unpaid work.  At the same time, more men working from home should allow them to more fairly share in household and parental chores.

“The key is to encourage and facilitate the work from home phenomenon so that its benefits can be nurtured rather than just go back to business as usual once the pandemic is behind us,” said Mr Oliver.

The post Women lead jobs recovery buy gender equality progress slows appeared first on AdviserVoice.

Bianca Hartge-Hazelman

Despite 2020 being a tough year, the financial progress of Australian women is trending in the right direction, but it will still take a century to achieve equality, as systemic issues hamper improvement in the unpaid work gender gap.

The Financy Women’s Index fell by 2.3 points (-3%) to 74 points in the December quarter, reflecting the worst performing quarter since March 2013, as women experienced a slower employment recovery than men.

The timeframe for achieving equality increased to 101 years, from a revised 100 years in the September quarter based on the worst performing sub-index (unpaid work) of the Women’s Index.

“At the current rate of progress, economic equality for women is still a long way away,” says Bianca Hartge-Hazelman, author of the Financy Women’s Index. “The Index shows that we are unlikely to see equality in Australia until the year 2122.

“Without significant change, it’s likely that women will continue to participate in paid work at a reduced capacity to men and this will affect women’s financial security and progress,” says Ms Hartge-Hazelman.

The Index also found that women are more likely than men to select educational pathways that are linked to lower paid industries which can have a profound impact on career earnings and gender pay gaps.

“The Index points to a need to reconsider the value of occupations that are traditionally female-dominated such as health, aged and child care,” notes Simone Cheung, Partner at Deloitte Access Economics.

Speaking on the widening of the gender gap in unpaid work, Roger Wilkins, co-author of the HILDA report, said it “seems likely” COVID would have increased the unpaid work disparity in 2020.

“The increase in child care provided at home brought about by closure of child care centres and learning from home is likely to have been disproportionately borne by women,” says Mr Wilkins.

In annual terms, women’s financial progress is headed in the right direction, and finished the year 1.3 points higher for 2020, compared to 72.7 points in December 2019. The Index peaked at 76.3 points in the September quarter.

A stronger year for the appointment of women to ASX200 board positions, up 6 percentage points to 32.6% and the best improvement in the gender pay gap (13.4%) since June 2018, helped drive the Index higher and cushion the December quarter employment growth shortfall.

The Women’s Index also shows it is expected to take 21 years to achieve equality in the national gender pay gap, 33 years in employment, 18 years in underemployment, 7 years for women on boards and 38 years to close the gender gap in superannuation savings.

“To speed up progress, we need cultural change to recognise the benefits of a more gender diverse workplace and greater female participation in it at all levels,” says Dr Shane Oliver, Chief Economist AMP Capital.

“This starts in the nation’s schools and runs all the way to board rooms and the nation’s parliaments. The pandemic has shown that the technology – to enable greater workplace diversity through workplace flexibility – is there to help make this happen,” says Mr Oliver.

Key results:

• The Financy Women’s Index has fallen 3% to 74 points in the December quarter as women’s financial progress collapsed on male employment recovery.
• The timeframe to financial gender equality rose to a revised 101 years, due to a widening of unpaid work gender gap and methodology update.
• Setbacks were seen in education, underemployment, employment and unpaid work as gender gaps widened in the December quarter.
• Improvements were seen in ASX 200 gender diversity on boards and narrowing of gender pay gap as men’s average wages declined.
• In annual terms, the Index is still headed in the right direction, up 2.3 points, but COVID-19 impacts and longstanding behaviors are making equality more difficult to achieve.

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