Recent lockdowns have pulled the handbrake on women’s financial equality with men, new research has suggested.
The road map towards financial equality between men and women has been stalled by the return to lockdowns, according to the latest Financy Women’s Index (FWX) report.
The June quarter edition of Financy Women’s Index (FWX), which demonstrates women’s economic progress when compared to that of men, showed that women’s financial recovery has slowed as a result of COVID-19 lockdowns.
According to the report, while the FWX rose by 0.9 per cent from 71.6 points to 72.2 points, it did so at a much slower pace than the 1.06 per cent rise recorded in the March quarter.
Furthermore, the index was also found to be down by 1 per cent from the 72.8 points recorded in June 2020.
Key to the report’s findings was that the lockdowns critically have worsened existing inequalities, such as pay and hours worked.
Notably, more women were opting out of work as lockdowns returned, especially as they have subsequently dragged on in NSW and Victoria.
“While the long-term trend for women’s economic progress is still one of improvement, as we continue to combat the pandemic, women remain particularly vulnerable to lockdowns and the disruptions from public health and social distancing orders,” said Financy chief executive Bianca Hartge-Hazelman.
The study’s findings were not in isolation.
Ms Hartge-Hazelman’s statement mirrors recent comments from Westpac senior economist Justin Smirk, who said that while an increased number of people “drop out of the labour market” during any period of downturn, the inability of children to attend school in current lockdowns was forcing more women to give up their jobs.
“What we’re seeing is the kids are being locked down at home as well and people are bailing out of the workforce and staying home to help raise the kids – predominantly women,” Mr Smith said in Thursday market outlook.
Mr Smirk also noted that the industries most hit by lockdowns were the ones that have high rates of female participation.
“Also in this situation, we’re seeing a lot of the jobs being lost in hospitality and services, which are female rich,” he said.
This likely impacted the FWX report’s findings that the number of monthly hours worked by females fell by 2.3 per cent between the March and June quarter, almost five times that seen among males.
What was also of concern was that the gender pay gap had widened to 14.2 per cent from 13.4 per cent, the biggest dollar difference ($261) recorded in full-time weekly wages since 2016.
“The pink recession, she-cession, pink-collar recession – whatever you want to call it, the impact of COVID-19 has not been gender-neutral,” said Deloitte Access Economics partner Simone Cheung on the findings.
The report, however, did offer some optimism that there has been some improvement in the women’s financial progress.
While showing a reduced pace of progress in the March quarter, the FWC remains up by 4 per cent when compared to December 2019.
Furthermore, the June quarter demonstrated a record high in the number of women occupying ASX 200 board positions to 33.5 per cent and a narrowing of the gender gap in the underemployment rate.
Despite this, it was made clear that this was not good enough, and focus should be given to the areas of improvement needed.
“Even abstracting from the impact of the pandemic we have a long way to go before women attain financial equality with men,” said AMP chief economist Shane Oliver.
“In some ways the pandemic – by accelerating progress towards more flexible working – may ultimately help progress towards financial equality for women. But at this stage we are still a long way from that.”
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