Women face £47,000 end of career pension shortfall, study warns

Analysis of 250,261 workplace personal pension plans held with Zurich between 2013 and 2016 shows that last year— on average—men under the age of 35 received £217 more in employer pension contributions than women of the same age

Zurich says that between 2013 and 2016, men received pension contributions of 7.8 per cent of their total salary each year from their employers compared with the 7 per cent received by women (Getty)

A major mismatch in the amount that men and women are receiving in employer pension contributions could result in women facing a shortfall of up to £47,000 by the end of their working lives.

A study published by life insurance company Zurich on Wednesday shows that employers are contributing less to women’s pension pots than to their male counterparts' a result of “the gender pay gap, career breaks for women and men working in larger businesses”.

Analysis of 250,261 workplace personal pension plans held with Zurich between 2013 and 2016 shows that last year— on average—men under the age of 35 received £217 more in employer pension contributions than women of the same age.

That difference grew to £594 for those aged between 34 and 44, £1,287 for those between 45 and 54 and £1,680 for those between 55 and 64.

The report also shows that between 2013 and 2016, men received pension contributions of 7.8 per cent of their total salary each year from their employers compared with the 7 per cent received by women.

“The impact of the gender pay gap on women’s pension pots is no secret, but this difference in the contributions that they receive from their employer presents a serious – and growing – problem,” says Rose St Louis, Zurich’s head of new retail distribution.

“The ‘triple effect’ of smaller salaries, career breaks for women and lower contribution rates needs to be addressed: we can’t ignore a £47,000 shortfall,” she adds.

On Tuesday, a cross-party committee slammed the Government for not doing enough to tackle the gaping divide between male and female pay.

The Women and Equalities Committee, which submitted a list of recommendations of improving the gender pay gap to the Government last year, argued that the Government was on track to miss its goal of eliminating pay divide within an generation and said that it was ignoring evidence.