There are signs that the Coronavirus pandemic is creating a structural shift in gender equality as pressure eases on some of the key barriers to women’s financial progress in 2021, the latest Financy Women’s Index shows.
The FWX finished 1.6% higher at 72.3 points in the December quarter, compared to 71.2 points in December 2020, aided by a closing of the gender gaps in employment, ASX 200 board positions and unpaid work.
It will now take 59 years to achieve financial gender equality in Australia, down from a revised 76 years in 2020, based on the worst performing area of progress – unpaid work.
Data suggests that more flexible work arrangements and better division of unpaid labour has enabled women to spend less time on unpaid work overall, whilst men are spending slightly more of their overall time in this area.
The significant reduction in the timeframes to equality has come as a surprise given there’s been so much commentary that the unpaid workloads of women had probably increased as a result of home-schooling and working from home during the lockdowns.
But in fact, women appear to have been working more than ever in paid employment, although for less financial reward than men.
While it is encouraging to see a greater balance in paid and unpaid work between women and men, if this is to be a long-term a structural shift then it is vital that we also see female workforce earnings keep up, especially in those hard-hit services areas like Health.
This quarter, the Financy Women’s Index sheds some light on one of the big questions to have emerged during COVID-19 – who bore the brunt of the unpaid work?
“The unpaid work index remains one the most important indicators of women’s progress, with the division of domestic tasks so closely tied to gender norms,” said Rhiannon Yetsenga, economist at Deloitte Access Economics.
“The pandemic and associated lockdowns have shown a path towards greater gender equality through more flexible working, but further cultural and structural change is required if we want to enable progress beyond the modest improvements seen this quarter,” said Ms Yetsenga.
Despite the annual FWX improvement, a disappointing December quarter weighed on the result, with a 2.2% drop driven by a widening in the gender pay gap (14.2%).
This was the only area of the Index which failed to improve over the year.
It acted as a drag on the annual rate of progress towards women’s economic equality, bringing it to about half of that recorded for the 2020 calendar year (1.6% versus 3%.)
“It’s frustrating to learn that, despite living in a wealthy, well-educated society in the 21st century, the Financy Women’s Index estimates it will take close to 22 years to close the gender pay gap,” said Effie Zahos, independent director InvestSMART.
“Right now, Australia is facing a skills shortage, and there may never be a better time for women to exercise their workplace clout and be paid what they are worth,” said Ms Zahos.
Among the other key findings on women’s economic progress:
- the gender gap in underemployment is now the smallest it has ever been, reflecting that strong labour market conditions combined with greater work flexibility during the pandemic has improved employment opportunities for Australian women.
- there was also an improvement in the number of monthly hours worked by women (6% gain versus a 5% gain for men in the December quarter).
- the number of women on ASX 200 boards increased over the latest quarter to 34.5%, as of January 31, according to the Australian Institute of Company Directors.
Nicki Hutley independent economist said she is “optimistic” that changes in the unpaid work balance will stick after the pandemic passes.
“There is still a lot of work to do and it’s concerning that some areas have worsened, especially the gap in graduate salaries. A gap right from the start tends to expand over the years and sets up a lifetime of inequality,” she said.
The remaining sub-indices of the Women’s Index such as Superannuation and Education will be updated in the March quarter of 2022.
Dr Shane Oliver, chief economist AMP said Australia needs to work harder on to getting gender equality right.
“The pandemic and associated lockdowns have shown a path towards greater gender equality through more flexible working – the key is for business, governments and workers to grasp the opportunity and push forward long after we leave the pandemic behind,” said Dr Oliver.
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