Australia’s 13 per cent gender pay gap will equate to a $93,000 deficit in women’s superannuation balances compared to men at retirement, according to research.
Aware Super’s inaugural Hold the Door report, published in support of Equal Pay Day, outlined five unconscious biases affecting women and urged for community-wide action to combat the systemic gap in women’s retirement balances.
It followed the Workplace Gender Equality Agency (WGEA) Equal Pay Day campaign on 25 August 2023, which marked the 56 additional days from the end of the financial year that women must work to earn the same average pay as men.
The issues identified in the report included early education, career selection, pay equity, gender-blind promotion, and development opportunities.
The finance sector holds the second-largest gender pay gap at 19.2 per cent, with the health sector sitting on top with a 21 per cent pay gap.
Gender pay gaps projections are based on an average 32-year-old Australian woman earning $1,686 per week during a 40-hour working week.
Additionally, a woman could miss out on up to $9,000 of super in retirement if she takes time off to have one baby.
This number increases to $18,000 in missed super if she has two children and becomes $27,000 if she has three babies, taking six months off each time.
Aware Super’s modelling found that women working part-time for one year, two years, or six years will lose $17,500, $35,000, or $105,000 of income, respectively.
They would also miss out on $2,100, $4,200, and $12,600 of pre-tax super, respectively.
This equals $4,000, $7,000, or $21,000 of missed super at retirement for those same amounts of time.
Deanne Stewart, Aware Super chief executive and WGEA Pay Equity ambassador, recognised that the gendered gap in pay and retirement savings stemmed from how women are brought up.
“In 2023 we need to recognise that these persistent gaps based on gender aren’t about a silent conspiracy to underpay women so much as an insidious, unconscious bias in the way we build and maintain our education and employment systems,” she said.
“Unless we actively take steps to account for these unconscious biases, they are destined to continue, and further entrench the disadvantages experienced by Australian women at work, at home, and in retirement.”
Recently, the $160 billion fund was among a dozen funds that signed a letter to the federal government urging reform that could help end gendered inequalities in super.
With advocacy body Women in Super and ESSSuper, AustralianSuper, Rest Super, CareSuper, Cbus Super, HESTA, Hostplus, NGS Super, Spirit Super, TelstraSuper, and UniSuper, it called for changes to the low-income superannuation tax offset (LISTO) that disproportionately affects women.
The letter also asked to increase the cap on how much LISTO is paid from $500 to $640 and extend compulsory super to the paid parental leave scheme that had gone unaddressed in the 2022–23 budget.
