Covid has hit women investors hard – but there are positives
“How did your pandemic go? As we gradually come out of blockages, this is a question we will likely hear much more often. The answer will undoubtedly vary from “hard” to “hell”.
No one has been spared the impact of Covid-19, whether physical, mental or financial. For me, it wasn’t that bad. Do not mistake yourself. Being locked up with a four and two year old, 24 hours a day, was relentless. But I succeeded because, unlike many others, I had a lot of support.
My husband, put on leave, shared the housework and childcare while my employer adopted new ways of working (even delivering my old office chair to my front door) and showed tolerance when I or a coworker had to soothe a screaming toddler or deal with an angry teenager.
The real godsend was my 24-year-old daughter-in-law, who arrived from Australia two years ago on a much anticipated gap year. She has helped with everything from watering the new vegetable garden to home schooling – though her dreams of travel, music festivals and making new friends were sadly extinguished.
The pandemic has come at a price for everyone, including young people and ethnic minority groups. But it is now well established that women have paid a particularly high price. Many have lost or quit their jobs, Covid-19 crystallizing the so-called ‘maternity penalty’, the opportunity cost a baby has on your paycheck and prospects. He also highlighted the “good daughter” penalty – the fact that daughters are still much more likely than sons to care for a sick or elderly parent.
The past 15 months have seen women give up their jobs, work less or lose productivity. Meanwhile, research shows that men have been promoted three times as much as women.
Women tend to dominate employment in the service sector. This industry is generally less volatile during recessions or downturns, but Covid-19 has become ‘typical’ in reverse, which brings me back to my daughter-in-law. As a trained hairdresser, she found a job at a local hairdressing salon soon after arriving in the UK. Hair salons tend to be recession-proof – even though the economy is faltering, people still need haircuts. But this time, no one had their hair cut. My daughter-in-law, along with many other women in the area, was put on leave.
Women are more likely to work in industries that require face-to-face interaction – think retail, hospitality, travel, airlines, personal care, and education. From receptionists to flight attendants, it’s a job that can’t be done from home. Now consider the fact that the UK is a service-based economy, with 80 percent of its output coming from this sector.
It is not just a British problem. Economic and national turmoil from the pandemic could wipe out 25 years of growing gender equality, UN data shows. And in the latest Global Women and Money Report, Fidelity International looked at the experiences and perspectives of women internationally, in six markets in the UK, Europe and Asia. He found that 31 percent of women had seen their ability to save decline in the past 12 months, compared to 26 percent of men.
The fallout will reverberate long into the future. On the contrary, the pandemic has taught us to anticipate uncertainty, and our personal finances are a good place to start. But it also taught us that uncertainty cannot jeopardize equality.
Industry and government must work together to close the gender pay, pension and investment gaps, now more than ever. Women need to embrace investing and move away from the misplaced “security” of simply saving as inflation rises.
The Fidelity Report also asked the question “Are you an investor?” and found that only a third (33%) of women consider themselves as such. The sense that investing was man’s land was true in every market bar surveyed in China, where 60 percent of women consider themselves to be investors – slightly more than the 58 percent of men.
Among the factors behind this is the tendency in China of families to educate girls about gender equality, the rise of women in the labor market and the increase in the educational level of women. . One of the benefits of China’s controversial one-child policy was that it opened up great educational opportunities for girls. Parents invest in the education of their only child, regardless of gender.
Beyond the lessons of opportunity, education and equality, there is an investment to remember in all of this – and it lies in the “S” of ESG. The social aspect of environmental, social and governance investment is the most difficult to define and quantify, but in a post-Covid world it is increasingly important.
Companies are under increasing pressure to take greater responsibility not only for the well-being of their workforce, but for the community as a whole and for individuals in their often complex supply chains. The issues range from how companies approach layoffs (think JD Wetherspoon and British Airways) to race and inclusion (Black Lives Matter) and gender parity in the workforce, reduction of the pay gap by promoting more women to higher levels.
Along with better run businesses and more sustainable investments, there is another ray of hope for women despite the devastating consequences of the virus. The pandemic has made remote working normal. The concept is now well and truly tested on the road. This is good news for women, who tend to choose jobs that suit their children, or older parents, with more manageable hours and shorter commutes. Doing this as part of a new world order should mean that women no longer face these societal sanctions.
The other good news is that after months of home teaching her four-year-old sister, my daughter-in-law has found her true calling. She is returning to Australia and will study to become a teacher.