Nearly a quarter of women ‘have suffered income fall in past 12 months’

Nearly one in four women have suffered a fall in their income in the past 12 months, a survey has found.

These women, 23% of those surveyed, may have lost on average as much as £5,500 of their annual salary, or around a quarter of their income, according to the calculations.

The findings were released by Fidelity International, ahead of International Women’s Day on Monday.

Income falls are affecting the ability to save and invest.

Nearly three in 10 (28%) women said the amount they have saved in the past 12 months has reduced, 17% of women have invested less, and one in eight (13%) have decreased their pension contributions.

However, a fifth (20%) of women reported their ability to save and invest had increased during the coronavirus pandemic, largely due to social restrictions meaning fewer outgoings and more disposable income to put away for the future.

Women in their 40s are particularly feeling the financial squeeze, with nearly a fifth (18%) decreasing their pension savings over the past 12 months.

The income shortfalls could exacerbate gender pay, pension and investment gaps that existed before the coronavirus pandemic.

More than half (51%) of women said their career, mental health or physical wellbeing have suffered in the past year.

Two-fifths (40%) of women who have experienced a fall in their income have been forced to dip into their savings to cover daily outgoings, while more than one in 10 have borrowed on a credit card to make ends meet.

Maike Currie, investment director at Fidelity International said: “The last 12 months have undoubtedly challenged all of us. However, women have been – and continue to be – disproportionately affected by the pandemic.”

She continued: “Female-centric industries have borne the brunt of job losses, furlough and income reductions, and women continue to balance this with more unpaid work like childcare and elderly care.

“Financially, the impact is significant. Reduced earnings and the already significant financial gender gaps when it comes to income and long-term savings, makes this particularly concerning. While the end of lockdown restrictions may now be in sight, the repercussions of women’s experiences over the last 12 months may reverberate long into their futures.”

Ms Currie added: “When we started our women and money campaign back in 2018, our aim was to get more women engaged with investing and preparing financially for the future. While circumstances have changed in the pandemic, encouraging more women to invest just small amounts will be important to ensure that this  doesn’t result in a permanent step back.”

More than 1,000 women were surveyed across the UK.

Jane Goodland, corporate affairs director at Quilter said the Government should encourage firms to consider “what more can be done to ensure the workplace is one in which female talent can thrive”.

She continued: “The gender pay gap reporting regulations have been a good first step, but more now needs to be done to get women into senior level positions and ensure they are better protected when the next crisis comes around.

“Increasing financial confidence through education and engagement will go a long way to ensure women participate more in the personal finances of the nation.

“Data has shown women often make better investment decisions and will make more sensible financial decisions, but they are often held back by a lack of confidence.

“As we rebuild, we should have an even greater focus on making policy decisions that are better informed by the challenges and barriers that exist for half the population – we must learn the lessons from this crisis and find a way to build back to a more equal society.”

A Government Equality Hub spokesman said: “The contribution that women make to the economy is crucial. Which is why we’ve set out an unprecedented offer of support which includes help for the sectors they are more likely to be employed in, protection for female led start-ups and new childcare support.

‘We understand it’s been a very difficult time for parents with childcare responsibilities and that is why we have introduced flexible furlough agreements and have extended the furlough scheme through to September, supporting employees who are struggling to work due to childcare.

“We also recognise that it is vital that children can return to school to lift some of the weight off parents across the country, which is why we have prioritised opening schools as soon as it is safe to do so.

“As we seek to build back better following the pandemic everyone will play a crucial part and we will reflect that in our policy development.”