ECNETNews Report
As we mark the International Day of Older Persons on October 1, it’s essential to reflect on the support extended to the elderly, particularly older women. Recent insights gathered by global institutions indicate significant disparities in women’s economic opportunities, raising critical questions about whether we are fully supporting this demographic or inadvertently neglecting them.
Challenging One-Size-Fits-All Pension Models
The unique challenges faced by women, including caregiving roles and career interruptions, highlight the inadequacies of traditional pension schemes. These systems, rooted in an industrial-era framework, overlook women’s lower labor force participation and the ongoing gender pay gap, resulting in financial disadvantages during retirement. The need for reforming pension systems to account for women’s diverse experiences is becoming increasingly urgent.
Caregiving’s Impact on Retirement Income
New findings show that in many countries, time taken off work for caregiving purposes is not factored into pension calculations. Without compensating mechanisms, many women suffer significant losses in retirement income, with studies indicating an average drop in replacement rates of three to seven percentage points.
Retirement Age Disparities
Variations in retirement ages can also complicate women’s financial stability post-retirement. In some regions, women are required to retire earlier than men, leading to reduced lifetime earnings. The retirement age gap varies significantly around the world, illustrating the complex landscape women navigate in retirement planning.
Enhancing Women’s Retirement Benefits
Encouragingly, some nations are implementing measures to improve women’s retirement benefits. Strategies such as tax incentives for voluntary savings and subsidies for early pension enrollment are gaining traction. Countries like the United Kingdom and Chile are leading the way with innovative approaches to mitigate the pension gender gap.
Recent Advances in Gender Pension Equity
In recent years, countries have made noteworthy strides in tackling the gender pension gap, especially in the MENA region. Bahrain, for example, has aligned retirement ages and accounted for childcare interruptions in pension calculations, setting a precedent for others. Similarly, Sierra Leone achieved a noteworthy milestone by recognizing childcare periods in its 2024 pension policy.
Call for Gender-Sensitive Policies
While progress has been made, the ongoing global challenges threaten to undermine these advancements. With women disproportionately employed in sectors hit hard by economic disruptions, there is an urgent call for gender-sensitive policy interventions to ensure sustainable safety nets for older women and address the unique factors impacting their ability to save for retirement.
Creating Equitable Pension Systems
Addressing pension inequalities necessitates a nuanced understanding of each country’s specific contexts, including fiscal capacities and labor market dynamics. Leveraging data-driven insights can guide the development of pension systems that not only empower women but benefit society as a whole.
