According to a report from the insurance company, Scottish Widows, young women face a pension shortfall of £100,000 and will have to work 37 years longer than men to bridge the gap.

While their ‘Women and Retirement 2020’ report revealed that saving towards pensions had hit a high among women (59%) compared to 60% of men who are “saving adequately” for their retirement, the same can’t be said for women in their twenties.

The gender pension gap has roots in long-term inequalities pitted against women, including the gender pay gap and the fact that many women take a break or leave the workforce altogether to care for their family.

COVID-19 has widened the gender pension gap for young women who have been exposed by their overrepresentation in some of the worst affected sectors. It found that more than a third (36%) of women under the age of 25 work in hospitality and retail, where almost half (49%) have been furloughed.

However, young women aren’t doing enough to save for their pension pot. Scottish Widows reported a lack of engagement with saving among women in their 20s, where only 46% of women said they were saving the recommended 12% of their income compared to 56% of men. They also found that the average young man put £1,100 more a year towards their pension than young women.

However, working part-time or on reduced hours, which has become a popular option for employers trying to bring staff back to work sustainably during COVID-19, “can mean lower contributions or missing out on auto-enrolment”, which means women are saving even less during this time.

To help plug this shortfall, the report has asked the government to raise the default contribution to pensions to encourage saving and allow employers to continue contributing a portion of salary at points when staff choose to opt-out. It also called for the minimum age for auto-enrolment to be lowered to 18.

While some might say that young women should save earlier to help bridge the gender pension gap, some might not have the salary to accommodate these allocations. Women are paid less on average than men means it might not be possible to save for pensions early on in their careers.

Jackie Leiper, a spokesperson for Scottish Widows ‘Women & Retirement Reports’, said: “Women were already facing systemic challenges when saving for retirement. We know that young women have been some of the hardest hit by the pandemic’s short-term financial impact, which has only exacerbated the challenge of reaching pensions parity. Simultaneously, caring responsibilities and high childcare costs are keeping women out of the workforce, lowering their contributions and denting their pension pots.

“Whilst we can’t change societal norms overnight, progress is still possible to help young women achieve a comfortable retirement. By taking control of their contributions and increasing them as early as possible, young women stand a fighting chance of improving their long-term savings outlook.”

To help bridge the gender pension gap, employers should help women remain in the workforce longer by providing flexible working conditions and shift patterns. With ONS data from 2019 revealing that 1.8 million women were not in paid employment due to family caring responsibilities, (compared with only 0.2 million men), providing flexible working conditions for mothers could do more to achieve pension parity and remedy gender pay inequity than simply telling young women to save.