It’s time to bridge the super gender gap - Industry Super Australia

MEN HAVE $282 billion more in their super funds and on average retire with $90,000 more in their account than women, new analysis by Industry Super Australia (ISA) has revealed.

ISA research shows that the gender pay gap persists and even widens when it comes to retirement savings.

On International Women’s Day ISA and Women In Super (WIS) are calling on the Federal government to make some simple changes that could help bridge the super gender gap, including paying super on Commonwealth paid parental leave, abolishing the $450 threshold and sticking to the legislated super rate increase.  

Analysis of tax file and ABS data reveals that on average women retire with 40 percent less super than men. But as the ISA table (below) shows women have less super at every stage in life.

A recent retirement survey, commissioned by ISA, found that on average women spend 12 years less in the full-time workforce than men, this time away from work is having a dramatic impact on their super balance.

The super balance gender gap begins to expand when a woman hits her 30s, the average super balance gap doubles from 15 percent at 30 to 30 percent once a woman reaches her 40s.

Men also receive $11 billion more in employer contributions each year than women. One in three women retire with no super balance at all, according to a 2016 Senate report.

Contributing to the gender super gap is:

• That women are still more likely to leave the paid workforce to do unpaid caring work for children or other family members,

• Wages in female dominated sectors such as nursing and teaching are lower than in male dominated sectors such as mining,

• Generally lower wages for women than their male counterparts when doing the same work,

• Women are more likely to have multiple jobs – often part-time – giving them more than one low-balance account.     

ISA and WIS has also called on the government to abolish the $450 super contributions threshold – where super is only paid if an employee earns more than $450 a month. The threshold impacts low-income and casual workers – a group that is over-represented by women.

Paying super on Commonwealth paid parental leave will help parents balance keep accumulating while taking time off from paid work and sticking to the legislated increase of the super guarantee rate to 12 percent will give women the opportunity to put more money away during their working life. 

ISA chief executive Bernie Dean said, “It is time we bridged the gender gap in super. We can help do this by abolishing the $450 threshold, paying super on paid parental leave and sticking to the legislated increase in the super rate.

“Until we fix inequities in the super system we will continue to see women retiring with balances that are persistently lower than men.”

Women in Super chief executive Sandra Buckley said, “Women should not be asked to trade off rent allowance or wage increases for super. Every Australian is entitled to a dignified retirement.

"For too long the structural inequities of the current super system have failed to take account of the women’s working patterns and lower lifetime income,"she said.

” A growing number of women older than 55 face the dilemma of a poverty-stricken retirement, as a result of caring for others.

“We have a unique opportunity now to act to change the structural inequities or we will be condemning future generations of women to the same appalling outcome.”

 

Table: The gender super gap at different life stages

Age group	Male median super balance	Female median super balance	Gender super gap
20 to 24	$6,523	$6,083	6.7%
25 to 29	$21,843	$19,861	9.1%
30 to 34	$45,800	$38,886	15.1%
35 to 39	$75,102	$56,610	24.6%
40 to 44	$102,810	$70,994	30.9%
45 to 49	$128,343	$83,245	35.2%
50 to 54	$153,133	$93,919	38.7%
55 to 59	$186,584	$111,125	40.4%
60 to 64	$188,024	$133,197	29.2%
All	$63,123	$45,443	28.0%

ends