Wage growth for American women is outpacing that of men, according to the Atlanta Federal Reserve Wage Tracker. In February 2022, women’s wages were up 4.4% from February 2021. By comparison, American men’s wages were up 4.1% for the same time period, and this was the sixth month in a row that women’s wage growth outpaced that of men, says the Wall Street Journal.
This is a stark contrast to the early days of the COVID-19 pandemic when many women experienced barriers to remaining in or growing in their careers. In some cases, this was because they were more likely to perform unpaid caregiving roles. Women globally perform 76.2% of total hours of unpaid care work, more than three times that of men, according to the International Labour Organization. But, women in the US also bore the brunt of pandemic-induced layoffs in 2020, losing 5 million jobs, nearly 1 million more job losses than men, according to a National Women’s Law Center report.
In January 2021, almost a year into the pandemic, more than half of women said the pandemic was hurting their careers, according to a UBS Investor Watch Pulse survey. Four in 10 said that pay raises and promotions had been put on hold or that they were working less than they had before the pandemic because of childcare responsibilities. Additionally, in 2020 women who were full-time, year-round employees made 83 cents for every dollar men made, based on median earning data from the Census Current Population Survey. That means women are paid about 17% less than men.
But now the tides are shifting. Women are gaining employment and earning more money in the current US labor boom, according to the Wall Street Journal. They made up a large portion of lower-wage service-sector jobs in personal care, food preparation, and healthcare support industries that suffered in the pandemic. As those businesses reopen and grow with loosening COVID restrictions, many have increased salaries in order to attract employees.
Women in the corporate world also received pay increases. About 31% of women who changed jobs during the pandemic got a compensation package—including salary and bonus—that was more than 30% higher than in their previous role, says The Journal. That slightly exceeds the 28% of men who reported such a pay increase.
As women increase their wealth, financial participation becomes more important. Half of married women still defer long-term financial decisions to their spouse or partner, according to the report Own Your Worth 2021: Building bridges, breaking barriers. Currently, only about 20% of couples make long-term financial decisions together. But, nearly 100% of women and men believe women should be more involved in those decisions, such as investing, financial planning, and estate planning. In addition, women and men overwhelmingly believe that, unless women are equally involved in these decisions, there will never be true gender equality.
How can women increase their financial participation
According to the report, married couples should set aside designated time to go through financial matters on a regular basis. This includes reviewing key financial documents and future financial plans.
Additionally, when women are a part of conversations with financial advisors, it ensures they have a clear picture of investment holdings. Personalized and relevant investment advice delivered systematically is key, according to the CIO report Women and investing: Reimagining wealth advice. CIO believes the advisory process should be based on a purpose-driven framework. One example is the UBS Wealth Way approach, which helps investors develop an investment strategy optimized for their goals and objectives. Using such a framework, women can define investment strategies that help them clearly understand where their money is and why, and as a result invest with confidence.
For more on the topic of gender equality through the lens of women’s financial inclusion, see the report Own your worth 2021: Building bridges, breaking barriers.
And for more on how the wealth management industry serves women and the trends that impact women and their wealth, see the UBS Chief Investment Office report Women and investing: Reimagining wealth advice.
Main contributor: Kerry Breen
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