To support women’s long-term financial security, superannuation cannot be overlooked
A generous parental leave policy and equal pay is a cost of entry in competing for and retaining talent. The real problem is in reducing the longer term financial disadvantages women having families face, writes Eithne McSwiney, managing director, GHO Sydney.
In 2006 I was interviewing for a senior role at a global agency. Before I walked into the office I took my engagement ring off. Why? The assumption at the time was that if you were about to be married, the odds were pretty high that pregnancy and children would follow swiftly after. The fear for many women was the loaded question: Who would want to hire someone that was going to take two years off work over the next four?
Actually I would, and do. Senior women with children are an untapped resource, and as most mums already know, we can be incredibly efficient. And whilst our industry is starting to see an increase in the number of women in leadership roles, as well as more female business owners, we still have to fix the inequality in which women are dealt with when it comes to their long-term financial security.
Of all the issues raised and the new policies announced through International Women’s Day, I didn’t see a lot of progress in fixing the gap in financial security that women experience throughout their career. The biggest problem we face in the creative industry is not just a pay gap but a gap in workforce participation and the consequential inequality women are dealt with regarding their savings. When women return to work after starting a family, we also often lose them to go ‘client side’ which is perceived to be a better option financially.
Large corporates with many times the scale of most creative businesses afford generous leave policies, and they are also the ones that have pushed forward with providing super when people are on parental leave. However, it’s time to step out from behind the defence of “we don’t have the financial resources to compete with the large multi-nationals” and change our view of what makes a profitable enterprise.
Political parties of all colours have this week been abandoning the idea of adding the Super Guarantee payments to parental leave and once again it has been left to the private sector to bridge the gap. Creative agencies typically don’t have the scale to match a large bank or retail company’s leave policies so it’s understandable that women are opting for roles that are not their first choice and leaving behind promising careers in our industry.
The statistics on the gap between male and female savings in super across age groups are confronting. More confronting is the consequence of this, which is the number of women over 50 facing homelessness (up 31% over the past 5 years), which is rising alongside a widening of the gap in savings between men and women.
These are of course the broad stats that every business should be working to resolve, but how can agencies, indeed even smaller independent ones, who actually employ large numbers of women early in their careers, genuinely help mums further their professional lives in the creative industry and feel fully supported by the business in their desire to have a family?
Firstly, there are those obvious steps like a paternity leave policy that supports primary and secondary carers around the early months of having a baby. There was a strong mix of small and large agencies announcing improvements to their leave policy on International Women’s Day which is good to see. But in my view, it’s only cost of entry stuff.
Another mandatory is the “re-entry” programs that recognise the real personal challenges new parents face beyond managing their demanding personal schedules after having a child. There is some good work being done here.
However, solutions to ensuring your savings are not penalised for having a child are moving at a snail’s pace. And this is urgent as loss of savings between the age of 25 to 35 are magnified when you get past 50.
Worse still if you chose to return to work 3 or 4 days a week you are being paid 20 to 40% less in super guarantee payments.
As they say, a principle isn’t a principle until it costs you money. Like a few others, we’ve introduced super contributions on top of leave payments, but we’ve also started to pay our returning mums’ the payment equivalent to full-time work if they choose to work less days a week. Indeed, for primary carers who feel they need to return to work full time, we recognise that their household and childminding costs will be putting a dent in savings, so we pay them 20% more in super each year up until their child gets to school.
We haven’t fully cracked it yet and feel we need to keep working on it. However, it is my hope that the industry discussion moves to policies that have a direct bearing on the magnitude of the financial challenges women face, which is clearly not just a short-term challenge.
Eithne McSwiney
Eithne McSwiney, managing director, GHO Sydney
