Over time and cohort/generation effects

I was very glad to hear recently from Anna Coote of nef that they will be publishing a fuller treatment of new approaches to working time.  Anna and I agree that it is vital to think of this in the context of working lives, ie over the full period of the decades that people work.  Her earlier work for nef focussed very much on a shorter working week, and explored the very broad range of benefits which would flow from a general shortening of the week:  a better spread of employment, better family arrangements and a more environmentally friendly consumption patterns, to  name but three rather large ones.  It’s good news that nef is extending their approach to working lives.

The link to the Paula Principle is thrown into sharp relief by a recent report from  the Age Immaterial initiative at the TUC, covering women over 50.   You can guess much of what follows, but it rarely gets attention – for the simple reason that older women are one of the least visible groups in the labour market.  The hourly pay gap between women and men over 50 is 18% for full-timers.  That’;s nearly twice that for the workforce overall – but it’s a heck of a lot less than 33% gap which exists between women part-timers aged over 50 (at £8.53)and the overall average wage (£12.76).

Since 3 in 5 women over 50 are in work – 1.5 million more than in 1992 –  this matters.   Let’s add in the generation effect:  many of these women will have missed out on the expansion of educational achievement by girls and young women which started in the 1980s and 1990s.  This is particularly true of those who are working past State Pension Age.   Partly as a result of their lack of qualifications, two thirds of them are in low-skilled jobs, whereas two thirds of men working past SPA are in higher skilled jobs.  The women’s pensions will be relatively very low.   In other words, the women are working because they have to, the men because they are in good jobs.   As the TUC wryly observes:  ” It is striking that the generation of women who fought for equal pay in the 60s and 70s have not themselves reaped the rewards.”

But their low incomes are only partly a function of their lack of qualifications.  Many of these women will have had career breaks which had strong and lasting effects on their income profile, more so even than today.  What we do not know is how far the generally better educated  younger women of today will manage to sustain their incomes into their 50s and 60s.  It seems reasonable to assume that they will.  But there is mounting evidence that gender pay gaps get wider over time.  This combines with the problems of adequate pension provisi0n and continually increasing longevity to suggest that we may still see very considerable, and growing, inequalities in what will often be a long later life.

Which is why we need a cumulative picture of pay and careers, over a working life and beyond.


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