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International Women’s Day | Women are bailed out until they die

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Girlfriends, mothers, grandmothers, students, sisters and entrepreneurs, will you celebrate International Women’s Day on March 8? Perhaps you’re not in the mood to celebrate after reading about how precarious your finances and retirement prospects are compared to those of men. It is true that it is depressing.

Still in mid-February, The Press published a text entitled Men’s wages have increased more than women’s1. We learned that in 2021, the average salary of men in Quebec increased by 2.7% to reach $ 30.16. While that of women only increased by 1.5% to reach $27.39.

This means that women, already paid less, are more burdened by price increases. Inflation, which stood at 3.8% in 2021, is 2.5 times higher than the increase in women’s wages.

According to the Statistical Institute of Quebec, the wage gap has widened because many jobs have been created in sectors where women are rarely present, especially construction, but also professional, scientific and technical (computing). After at least a decade during which the gap has narrowed, here is a heartbreaking turnaround.

Let’s hope that the year 2021 is only an anomaly, an exception due to its exceptional pandemic character. And not proof that a plateau has been reached.

It is clear that even if universities today are full of women, especially in medicine, financial equality is far from being achieved. And at all ages.

Take savings. Even among the youngest workers, those aged 25 to 44 who have always lived – it is said – in a Quebec with little discrimination, there are striking differences.

On average, 78% of them have started to put money aside for their retirement, according to a fresh survey by ÉducÉpargne in collaboration with Léger and Retraite Québec.

When we look more closely, we discover that 83% of men in this age group save, compared to 73% of women. A difference of 10 points!

How is this explained? The survey clearly shows that working full or part time has a major impact. Among part-time respondents, less than 6 in 10 (58%) are saving for retirement. And guess what? Women are 2.5 times more likely to work part-time.

Income level is another explanation. It is obviously a lot easier to save when your income is high.

And among the 1,000 survey respondents aged 25 to 44, what proportion earns more than $80,000 a year? Among men: 32%, among women: 17%, Léger told me.

***

I don’t know how concerned women in their 35s or 40s are, but this kind of gap in earnings and savings can have lifelong (and retirement) consequences.

Last year, human resources consulting firm Mercer released a report2 containing a number of sentences that I would describe as shocking:

“Women retire having saved 30% less than men. »

“Women have a lower annual income and a lower quality of life in retirement. »

“Women have to work at least two years longer than men to retire. »

Because of their longer life expectancy, “women need more, but retire with less”.

“Even if women are adopting the right savings behaviors, structural factors prevent the reduction of the savings gap,” such as career interruptions due to pregnancy and wage inequity.

Admit that it is maddening!

Some numbers

Average monthly QPP pension*

  • Men: $632.50
  • Women: $459.45

Average QPP retirement pension for women*

  • In 2021: 73% of that of men
  • In 2010: 65% of that of men
  • In 2000: 59% of that of men

Proportion of QPP beneficiaries who receive $700 or more*

  • Men: 45.9%
  • Women: 23.1%

Proportion of new beneficiaries with 100% of the maximum QPP pension**

  • Men who received the maximum pension: 4.8%
  • Women who received the maximum pension: 0.9%

* As of December 31, 2021
** In 2020 (most recent figures available)

Source: Quebec Pension Plan (QPP)

In search of solutions and glimmers of hope, I spoke with Stéphanie Mariamo, senior adviser of the Assets domain at Mercer Canada. In his opinion, companies can take steps to improve the financial situation of their employees.

For example, when a woman takes maternity leave or is absent to take care of a loved one, there is a way to reduce the extent of the “loss of savings” that is already affecting her Quebec Pension Plan, especially. “Companies must communicate well and encourage women to continue contributing to their pension plan,” suggests the expert. And it has to be “simple” for them to do so. The employer could also contribute for his employee even if the latter does not do so, for lack of sufficient income, suggests Stéphanie Mariamo.


LACHEVROTIERE PHOTO PROVIDED BY STÉPHANIE MARIAMO

Stéphanie Mariamo, Senior Asset Advisor at Mercer Canada

My grain of salt: in order to balance the financial impact of the arrival of a child in a couple, men should have the reflex to contribute to the retirement plan of their lover. And to compensate for the loss of a bonus, for example.

Another solution is education, continues Stéphanie Mariamo. Companies can give tools to their employees to develop their personal finance knowledge. When they offer training, for example, women are more likely to participate than men, we observe at Mercer.

By having more confidence in their means, they will plan their future better and dare to invest more, which is essential given their life expectancy.

Companies alone cannot fix everything, of course. So, men, fathers, husbands, colleagues and senior leaders, we find solutions and we put them in place for all these women you love so much?



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