7. Gender Pay Gap and Pension Fund for Women in South Africa

The fact that women have less retirement savings than men is rooted in a plethora of factors that need to be examined, central of which is the unequal gender pay inherent within the labor sector wherein women earn less than their male counterparts. Gender pay gap has been the focus of research on inequality in remuneration, and the adverse effects it has on economic empowerment and gender equality at large. In addition to this is the effect it has on retirement savings and the likelihood of women having pension fund to sustain them. There appears to be a relationship between gender pay gap and pension inequality between men and women. Hence, this chapter examines how gender pay gap affects women’s retirement savings in South Africa in order to understand the relationship that exists. Using a qualitative methodology and literature analysis, it argues that the pay gap between men and women permeates into retirement savings such that women are less likely to have sufficient pension fund, further consolidating the poverty of savings and widening the economic gap between men and women. It recommends that there is a need for the design of a pension fund targeted at women to enable them to make informed choices on retirement savings. It adds that for pension inequality to be addressed, gender pay gap must be mitigated to ensure income equality between men and women.