Inequalities and the persistent gender gap in access to income security in old age
7. Inequalities and the persistent gender gap in access to income security in old age
Income security in old age and access to pension benefits are closely associated with the inequalities that exist in the labour market and in employment. Such inequalities become evident from examination of a disaggregation of coverage rates by gender, the focus of this section (see figures 9 and 10).
It is widely known that women tend to face a higher risk of poverty than men do, and there are many underlying reasons why this also applies to women in old age. First, there is the fact that women live longer, resulting in predominance at the oldest ages of women with poor levels of support and livelihood (UNFPA and HelpAge International, 2012; UNRISD, 2010). Not many pension systems succeed in meeting the needs of men and women equitably: contributory pension coverage of women tends to be significantly lower than men’s, and the amounts received by women on average tend to be lower (Razavi et al., 2012).
A gender-biased design of pension schemes (e.g. lower pensionable age for women, or the application of sex-specific mortality tables to calculate benefit levels which result in women receiving lower pensions than men with the same contribution record and retirement age) can lead to inequalities; yet in many cases a more significant driver of gender inequality is found in the discrimination against women in the labour market, coupled with a pension scheme design which does not compensate for differences deriving from labour market conditions and sometimes even magnifies them (Behrendt and Woodall, 2015). In this context, many women struggle to accrue pension rights that are equal to their male counterparts. Women’s wage employment, particularly in formal labour markets, has historically been lower than men’s and continues to be so in many parts of the world (ILO, 2012). Likewise, women systematically earn less than men (ILO, 2014b), which lowers their contributions to pension schemes. As women tend to take on a greater share of family responsibilities, they are more likely to shorten or interrupt their employment careers and face a higher risk of working in precarious and informal employment, which also affects their ability to build up pension entitlements. These factors lead to relatively low pension benefits where these are calculated on an earnings-related basis, unless effective measures are put in place to compensate for gender inequalities.
Figure 9.
Old-age pensions, effective coverage: Percentage of the labour force contributing
to a pension scheme, by sex, latest available year
Figure 10. SDG indicator 1.3.1 on effective coverage for older persons: Percentage of the population
above statutory pensionable age receiving an old-age pension, by sex, latest available year
Sources: ILO World Social Protection Database, based on SSI; OECD SOCR; ILOSTAT; national sources. See also Annex II, table B.6. Link: http://www.social-protection.org/gimi/gess/RessourceDownload.action?ressource.ressourceId=54662
Non-contributory pensions can play a key role in ensuring women’s access to at least
a basic pension, yet benefit levels are often low, insufficient to fully meet their needs; nor do they fully compensate for the lack of contributory coverage. Greater efforts are necessary, also to ensure increased participation by women in contributory schemes (ILO, 2016).
It should also be noted that in many parts of the world women are disproportionately represented among the rural population, where paid work, even if available, is likely to be relatively poorly paid, informal and insecure – reflecting, in part at least, the movement of men to cities in search of better-paid work at the more formalized end of the labour market spectrum. At the same time, the growing importance of non-contributory pensions in the provision of old-age income, especially in low- and lower-middle income countries, is clearly helping to bridge the coverage gap between men and women to some extent. For instance, in Thailand, 84.6 per cent of women above retirement age are receiving the non‑ contributory pension, but only 77.9 per cent of men (figure 10). Likewise, Azerbaijan provides a pension for 95 per cent of its female citizens through its universal social protection system that, among others, consists of a contribution-based labour pension and social allowances (transfers).
On the other hand, Costa Rica indicates a relatively low coverage of its female On the other hand, Costa Rica indicates a relatively low coverage of its female
Gender equality considerations are gaining some ground in the public debate on pensions. Proactive policy measures have been implemented in some countries to reduce the effect of differentiated career patterns on old-age income security. The most obvious discriminatory elements and parameters of national pension schemes, such as the differential pension ages which were common until recently, are rapidly being eliminated, albeit in the context of general increases in pension ages for both women and men.
Other steps in the same direction include crediting pension accounts during maternity, paternity and parental leave, and a better recognition of care work undertaken by both women and men. Measures to facilitate a more equal sharing of care responsibilities between women and men contribute to addressing some of the inequalities in the labour market and in social protection more broadly, and may be reflected in a reduction of gender inequalities in labour markets and pension systems in the long run.
As with so many other aspects of social protection, those relating to the promotion of equitable treatment of women and men must – if they are to be addressed effectively and in
a spirit of social justice – be dealt with on a basis which fully integrates labour market and social protection policy-making.