At retirement, Mexican women earn almost 40% less wealth than men

All over the world, there are gender gaps employment, wages and health, among other areas. This means that at the end of a working life, women accumulate 74% of the wealth reached by men. But in Mexico, women workers reach 63% of resources that they achieve.

The above, according to the Global Report on Gender Equity in Wealth 2022. The research of the WTW consultancy incorporates a measurement for different regions and countries, referred to in the Equity Index (WEI). Similarly, it identifies the way in which leaders and companies can lead “real and lasting change” to improve the wealth of women at the end of their careers.

The report confirms, as national and international organizations have done, that historical inequalities affect “disproportionately women throughout their careers. And it is becoming increasingly clear that this trend has far-reaching implications for individuals, organizations and society as a whole.”

In Latin America, despite the improvements, “partly due to government regulations that try to enshrine the equality of labor and social rights”, presents low indices of gender equality in the generation of wealth.

Argentina it is where female workers generate the least wealth for themselves at the end of their career. In this country, women reach 61% of the capital that men obtain. In second place is Mexico, with 63 percent. They are followed by Brazil, with 68% and Colombia, with 69 percent.

Chile, where women obtain the equivalent of 76% of the assets and economic resources accumulated by men, is the only country in Latin America that is above the world average (74%). However, there is still an inequality between women and men workers.

Some of the causes behind this reality

to build the Equity IndexWTW specialists took into account the factors that contribute to the gender gap in wealth. They concluded that a lower accumulation of goods and economic resources is due to a combination of:

» Gender pay gap

In Mexico, while just over 704,700 women earn between three and five minimum wages, more than 1 million 567,000 men are in that salary range, according to the National Occupation and Employment Survey (ENOE).

And if we raise the figure to more than five minimum wages, we see that 248,000 women and 546,000 men are in that category. In other words, there are fewer female workers receiving the highest salaries. This “contributes to reducing savings and generate less wealth for the same job roles as men,” the report says.

In addition, 40% of women with a paid occupation in Mexico do not have access to social security through its use, according to the ENOE. In other words, of more than 22 million women workers, only 9 million are more likely to retire one day with a monthly pension.

» Fewer promotional opportunities

Job recognition that slopes much less than for men “leads to slower wage growth and less wealth accumulation” for female workers. In the case of Mexico, “women represent 12% of all relevant managers” in companies, according to the Mexican Institute of Competitiveness (Imco).

» Career gaps

Female workers “are more likely to temporarily or permanently leave the labor force to meet caregiving responsibilities.” Many women take several years to return to employment after becoming mothers.

Other moms come back for a while, but if they don’t find help or don’t have the financial resources to apply for it, they leave the working market again.

According to the National Institute of Statistics (Inegi), 74% of the time dedicated to unpaid household and care work is provided by women. Men contribute 26 percent.

These loads, which some women combine with great wear and tear with their paid work, “influence career and salary and also directly affect wealth.” By perpetuating Gender roles and the sexual division of labor, women assume the commitment of the rest of society.

WTW added other apparently more personal circumstances that, however, directly influence the employment and wealth of women, such as divorce or widowhood. And, although it does not include being a single mother from the beginning, this situation is also consistent with the results mentioned in the report: when your household is supported only by a salary, “it limits income and the accumulation of wealth.”

Another factor that is rarely thought of, but which is also highly relevant, is “the greater aversion to risk when investing”.

Specific actions to close the gaps

“It is imperative that activities around diversity, equity and gender inclusion expand to consider economic wealth at the end of the working career of women,” the report says.

One of the actions that companies and their leaders must undertake is to improve the women’s salary, but it is not the only measure nor the panacea. “It’s a fundamental factor underlying the gender wealth gap,” but it won’t eliminate it entirely, he says.

One way to close the gender pay gap is “by evaluating programs and Human Resources processes”. The problem, he explains, may lie in the offer of the position and in the hiring processes.

Then, career equality can be supported by “career trajectory mapping, salary transparency and the skills architecture focused on the development of women in managerial and leadership roles”.

Another important measure is to ensure the continuation of pension contributions for women, designing “retirement programs taking gender diversity into account” and the possible pauses of mothers, for example.

No action is separate. For example, the latter is accompanied by the improvement of the care benefits “with a focus on wealth outcomes by designing leave programs” that recognize the uniqueness of men, women, and non-binary people. As well as allowing flexibility in the workplace.