Women, work and retirement

Women, work and retirement Prof Susan Dann National Seniors Productive Ageing Centre

Overview • Mature aged work and phased retirement study • Women and retirement in Australia • Past policies and future trends

Study Objectives • To identify how to increase the participation of mature aged workers in the labour market • To identify barriers to participation • To identify costs and benefits involved in engaging mature aged workers from both an individual and organisational perspective

Sample • 3,000 members of National Seniors aged 50 and over • Member response rate of 30.8% giving 413 male and 493 female respondents • 41.5% were not retired, the remainder were in various stages of retirement (eg retired but doing volunteer or part time work) with only 13% fully retired

Issues Covered • Objective data collected on demographics, income, employment status etc • Attitudes to work and retirement including • Job satisfaction • Work centrality • Retirement satisfaction • Mature age worker stereotypes • Planning activities pre-retirement

Key Finding • Inverse relationship between economic well being and participation

Gender Issues • In most analyses conducted there were relatively few significant differences between the men and women except for issues related to financial well being • Given the importance of economic well being as an indicator of work patterns and retirement satisfaction this is critical

Results • Pre-retirement income • Men most likely to be in the $40-55,000 group • Women most likely to be in the $25-40,000 • 25% of women earned less than $25,000 while just under 10% of men did • 20% of men but only 5% of women earned more than $70,000

Results • Retirement income • Men concentrated in the $25-40,000 group (37%) with 6% on less than $10,000 • Women concentrated in the $10-25,000 group (34%) with 20% on less than $10,000 • Women were more likely than men to source their main retirement income from the pension • Women more likely than men to work in retirement • Men had a greater income from investments

Results (attitudes) • Women less satisfied with pre-retirement income and significantly more concerned with economic well being • Women were not only more likely to work but were more likely to work for financial reasons and also work longer hours • Women reported higher levels of work centrality, organisational commitment and job satisfaction

Results (planning) • Overall planning for retirement was poor • Men and women displayed the same patterns of planning, with a strong focus on financial planning But • Women’s involvement in planning occurred at much lower levels with the exception of stress management

Women in Retirement • Experience of women in the survey broadly reflects the experience of women in Australia • Women in retirement currently have significantly more financial problems than men

Women in Australia • retire earlier and live longer than men • are more likely to be fully dependent on an aged pension • have lower access to paid employment after ‘retirement’ age which, although the gap is systematically being narrowed, is still lower for women than for men; • have significantly lower levels of superannuation than men • have significantly lower levels of savings and • are more likely to live alone due to rising divorce rates combined with longevity and the likelihood that they will outlive their spouses

Overview of Retirement Income in Australia Three pillars • a taxpayer funded means-tested aged pension for people who are unable to fully support themselves in retirement; • a minimum level of compulsory employer superannuation contributions made in respect of those in the workforce (introduced in 1992); and • voluntary private superannuation and other savings.

Past Policies, Future Trends • The ability of people to support themselves in retirement therefore is strongly linked to life time earnings • Women have not earned as much as men due to a variety of factors two of the most important of which are interrupted career patterns and the persistence of the gender wage gap

Past Policies, Future Trends • Interrupted careers • Becoming less of a problem for those entering the work force now but the legacy of lack of child care and community expectations will be felt for those entering retirement for the next twenty years • Social pressure on women as carers not only for children but parents and partners – problem is less but has not disappeared

Past Policies, Future Trends • Gender wage gap • Principles of equal pay have been accepted since the 1970s however women still earn less than men on average • Full time wage $1,057 for men and $899 for women (15% gap) or $158 per week • Total weekly earnings $929 men and $616 for women (34% gap) or $313 per week • Gap varies across industries

Planning and Future Retirees • Women are disadvantaged through lower life time earnings • Cannot invest as much or as effectively • However this is compounded by the low levels of investment and retirement planning traditionally and currently being undertaken by women • Need better incentives to improve planning

Conclusion • Women in retirement now and coming into retirement are clearly disadvantaged by a combination of factors, many of which originate from past policies • Problems are likely to persist unless women place greater emphasis on forward planning and investment • Needs to be a change in attitude and behaviour towards retirement planning

Women, work and retirement