Financial equality more than a generation away

AUSTRALIAN women are well over a generation away from achieving financial equality with the latest Financy Women’s Index showing that progress has slowed over the past financial year despite a record narrowing of the superannuation gender gap.

The Women’s Index rose 0.5 points to 123.9 points in the June quarter, from a revised 123.4 points in the March quarter of 2019.

While women’s economic progress has improved 5 points over the 2018-19 financial year, it’s less than the 7.5 point gain recorded in the 2017-18 financial year when the score rose to 118.9 points from 111.4 points.

“It’s disappointing to see that despite greater awareness around gender equality, progress slowed over the past financial year, reflecting the weakest start to a calendar year since 2017, when the Index was first launched,” Financy Women’s Index founder Bianca Hartge-Hazelman said.

Overall, when the annual pace of progress recorded by the Financy Women’s Index is compounded and compared to the revised (FWX) Progress Target of 172 points, it shows that on the basis of current trends, Australian women are 45 years from achieving economic equality.

The FWX Progress Target is an aspirational guide on economic equality and is calculated by benchmarking women against men from data collected in 2012, which is the baseline for this Report.

“It is pleasing to see progress being made on the Financy Women’s Index in the  June quarter, albeit slowly,” Deloitte partner Nicki Hutley said.

“However, as the mother of three girls, the thought that genuine economic equality is well over a generation away is disheartening. I would like to see further efforts on the part of policy makers and organisations to see greater strides made more rapidly,” she said.

Unlike previous quarters, the biggest factors that held back women’s economic progress in the June period included a moderation in female full-time employment growth and a lack of action by Corporate Australia to improve the representation of women on the boards of the top 200 listed companies.

Women occupied 29.7 percent of ASX 200 board positions in June, which is exactly where it was in December 2018.

“The numbers don’t lie,” OneVue Group CEO Connie Mckeage said. “We have seen one of the slowest quarters of progress and we have to ask ourselves why, despite efforts across the board, is this happening? 

"More importantly, do we need to start doing something differently?” Ms Mckeage said.

The factors which supported women’s economic progress in the June quarter include improved workforce participation, a record narrowing of the superannuation gender gap, improved underemployment, a fresh low in the gender pay gap, and higher tertiary enrolments.

The number of women employed full-time in the Australian workforce held relatively steady at a seasonally adjusted 3.27 million in June, while the female underemployment rate fell by 0.8 percentage points to 10.3 percent in January, from 11.1 percent a year ago.

The latest superannuation balance data by gender from the Australian Bureau of Statistics (ABS) shows that in the 2017-18 financial year, the gender gap has narrowed to 28 percent, from 34 percent in the 2015-16 financial year.

“It's great news that the super gender gap has fallen to its lowest point, but this is being driven largely by women's increased workforce participation,” AMP Financial Planning adviser Dianne Charman said.

“The super gap widens significantly by 45 years of age because of time spent out of the workforce raising children, so women still need to have a plan for making extra contributions later in their working life,” Ms Charman said.

The Financy Women’s Index for the June quarter also shows a small decline in the number of hours per week that women spend on unpaid work. However there has been little change in level of unpaid work undertaken by women over the past decade.

In 2017, the average woman in a coupled relationship performed a total of 59.5 hours per week in paid and unpaid work, which is 4 percent more than the 57.2 hours of the average man.

"While the difference is small, when we calculate the percentage that is unpaid, we find that women spend 62.6 percent of their time doing unpaid work, while men are doing 37.8 percent of unpaid work," the report said.

"Gender stereotypes persist in tertiary education enrolments and we continue to see subject selection in course areas such as Information Technology being male dominated and Health being female dominated.

"While more women are enrolling in tertiary studies than men, many face a gender pay gap once they enter the workforce. The average gender pay gap stands at $3,000 or 4.8% based on 2018 data," the report found.

AFA Inspire national chair Kate McCallum said, “I’m delighted that we are moving in the right direction, with a five point financial year gain in the Financy Index’s metric on women’s economic progress,

“I’m particularly delighted that women’s super balances are notching up.  However I’m also seriously worried that it seems that women’s progress in one area is matched by backward steps in others, like the stalling of full time employment," she said.

“It seems that when some people see improvements in one aspect of women’s equality, they extrapolate this to mean that women have equal opportunities in all areas. And then I’m worried because if they don’t believe that inequality persists, they don’t need to be concerned – or do anything – to bridge the gap.

“The good news is that we have metrics like the Financy Index to remind us that change is happening and to press for urgent action for the change we need,” Ms McCallum said.

Key results Financy Women’s Index June Quarter

• The Financy Women’s Index rose 0.5 points to 123.9 points in the June quarter, from a revised 123.4 points in the March quarter of 2019.
• A moderation in female full-time employment and little improvement in female board appointments affected the score.
• Record low in superannuation gender gap helped progress.
• Little change in amount of unpaid work for women in a decade.
• Australian women are 45 years from economic equality.

 

About the Financy Women’s Index:

The Financy Women’s Index powered by Data Digger is an initiative designed to encourage women to live fearlessly by empowering them with insights to help them realise their economic potential. The Index is reviewed by an Advisory Committee of high profile economists and business leaders as well as the Australian Bureau of Statistics.

It is based on monthly, quarterly, biannually, yearly and two-yearly data and methodology from the Australian Bureau of Statistics (ABS), the Australian Securities Exchange (ASX), the Household, Income and Labour Dynamics in Australia (HILDA) Survey, the Australian Government Department of Education and Training and the Australian Institute of Company Directors.

The Index is designed to highlight trends among working women; from the courses they study once they leave high school, their level of unpaid work relative to paid work, to what industries they work in, whether they want to work more hours but cannot, their earnings and savings in superannuation, through to those occupying top company board positions.

The Financy Women’s Index is an independent report, which is sponsored by platinum partner Australian listed fintech company OneVue, and bronze partners AMP Financial Planning and the Association of Financial Advisers (AFA). It is also a partner of the Economic Security 4 Women.

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