Today's working-age women are in danger of retiring with £47,000 less in their pension than their male counterparts, a report by Zurich has found.
The report, which covered 250,000 pension plans in the UK, found that since 2013 women had received on average 1 per cent less of their salary in workplace pension contributions.
If left unaddressed, the report argued this could lead to a nearly £50,000 pension gap opening up between men and women at retirement.
The report, called Zurich Workplace Savings Barometer, said the gender imbalance was due to lower pay for women, resulting in smaller workplace pension contributions, less time spent in the workplace due to career breaks, and the fact that men were more likely to work in larger businesses which often offer better employer pension contributions.
Between 2013 and 2016, the average man under 35 saw his employer contribute 7.8 per cent of his salary to a workplace pension. For women, the figure was 7 per cent.
As a result, in 2016 the average man under 35 received £217 more in employer pension contributions than the average woman in the same age group.
Over a working life, this difference added up to £46,689, taking wage growth into account.
Rose St Louis of Zurich Insurance said the difference in the contributions women receive from their employers presented "a serious and growing problem".
"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.
"Workplace engagement and guidance has a central role to play in helping women make the most of their saving potential while they are working full time," she said.
Zurich's report added to growing concerns that the auto-enrolment system is failing large segments of society.
Citizens Advice also released a report that revealed more than 100,000 people working in multiple jobs were missing out on auto-enrolment, despite earning the required amount to qualify.
That was because auto-enrolment only kicks in when you earn more than £10,000 a year from a single employer.
However, the research found 106,000 of people working in multiple jobs were earning in total more than £10,000. But because this was not earned with any one employer, they were not receiving any pension contributions.
Of the 106,000, the vast majority (70,000) were women.
The government has already stated it will focus on bringing more people into the auto-enrolment system. It has indicated it will examine the earnings threshold, as well as looking at ways to bring the self-employed into the regime.
james.fernyhough@ft.com
