Policy experts have long acknowledged a gender gap in retirement security. Women tend to earn less than men, and they are more likely to take time off from work to
care for children or elderly parents. Even brief career interruptions diminish wage growth, retirement savings and Social Security benefits, which are determined by wage
history. Women also tend to outlive men, needing to stretch resources over more years. In particular, they face higher health care expenses in retirement. Now, the
pandemic recession is disproportionately damaging the careers of women—so much so that some experts call it a “shecession.”
One recent study found a disproportionate decline in employment for women of prime working age, 25 to 55, compared with men—and especially so for mothers. Even
a short-term interruption in wages can have a surprisingly large impact on retirement. Each year out of the work force translates into losses considerably larger than
the immediate salary over the arc of a career, according to research by the Center for American Progress. The losses compound over time in the form of missed wage growth,
retirement savings and Social Security benefits, as illustrated by a calculator developed by the center.
For example, a 35-year-old woman earning $80,000 a year who leaves the work force for five years can expect to lose $197,000 in retirement assets and benefits,
assuming she retires at age 67, according to the calculator.
Social Security plays a crucial role as a source of guaranteed lifetime income in retirement, and most proposals advanced by Democrats include changes aimed at improving the economic security
of women. A plan from President-elect Joseph R. Biden Jr. would tweak Social Security’s benefit formula to award work credit to people who cared for children or
other relatives. It would also expand benefits for widows in certain circumstances, and bump up benefits for seniors who had collected payments for 20 years. Finally,
it would adopt a new yardstick to determine Social Security’s annual cost-of-living adjustment.
But perhaps the most significant change, experts say, would be to bolster the nation’s system of child care. Mr. Biden has signaled that supporting caregivers
would be a priority for his administration, and he has proposed $775 billion in new spending over a 10-year period that includes paid family leave and changes to
Medicaid.
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