Auto-enrolment hasn't solved retirement gender inequality

New government figures highlight that women are still facing disadvantage in retirement. Although there was positive news that almost "40% of the annual rise in female employment was in managers, senior officials or professional occupations", it is still the case that many women choose to work part time to fit around other responsibilities.

This is acknowledged by the government, which states that working part time suits many women because "they want to fit work around caring responsibilities". Only 12.4% of women working part time would prefer to be in full-time employment.

The problem is that such employment is likely to leave women at a severe disadvantage in retirement, which, as we explained in our Challenges facing women in retirement mini-series, is a growing issue that needs to be tackled.

Auto-enrolment has been hailed as a saviour of the pensions crisis that Britain faces, and while it is helping millions of people who otherwise wouldn't have any pensions provision, anyone earning below £10,000 a year needs to ask to be enrolled. Of employees earning £7 an hour or less, 63% are women, and it is women who make up the majority of part-time employees too.

This highlights the disadvantage women have in the workplace, and they are more likely to be excluded from auto-enrolment because of low earnings. Even those that want to join may feel they are unable to because they do not have enough disposable income to save any into a retirement fund.

It is no wonder that 76% of women do not think they will be financially comfortable in retirement. Auto-enrolment has been a welcome introduction and will help secure a more comfortable retirement for millions of people, but the most in need are still lacking the protection.

Professional financial advice should be sought to understand all the options available, which can be scenario-dependent. For instance, widows may be able to claim 100% of their husband's pension, and there are backdated pension rights under certain conditions.

Are you in part-time work and concerned about your pension? Let us know on Twitter or Facebook.

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The details provided in this article are for general information only and are in no way deemed to be financial advice. All of the material is correct as of the publication date, but could be out-of-date by the time you read the article. For our latest information and news, please see our articles section: https://www.portafina.co.uk/whats-new

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