Abstract
This study investigates the importance of mid-career income for the gender pension gap and psychological scarring effects of low income earlier in life. More specifically we analyse whether women's typically less stable mid-life careers also affect outcomes in late careers and in retirement. Swedish income register data from 1990, 2009, and 2015 was linked to the “HEalth, Ageing, and Retirement Transitions in Sweden” survey. The gender pension gap of 966 retirees and worries about pension income of 2,723 older workers between the age of 60 and 66 years were investigated. Blinder-Oaxaca decompositions were applied to analyse the gender pension gap and linear regressions were used for the analysis of financial worries. Results show that gender differences in mid-career income play a stronger role for the gender pension gap than late career income. Mid-career income is furthermore related to higher worries about pension income and accounts for observed gender differences. Our findings demonstrate that gender gaps in mid-career income can be regarded as an open wound with visible negative effects in older ages. The reformed pension system in Sweden may potentially contribute to an even greater gender gap in pensions.
Highlights
Life course research frequently finds evidence on scarring effects from early career experiences and exposures for later life outcomes (Lucas et al, 2004; Brandt and Hank, 2014; Hetschko et al, 2014; Strandh et al, 2015; Heisig and Radl, 2017)
This study will focus on gender gaps in mid-career income and how they may contribute to gender gaps in pensions as well as gender differences in the subjective expectations of financial difficulties after retirement
Do these midlife gender gaps contribute to scars in late life pension income? do they leave a feeling of financial insecurity and stress in late life and can be seen as an open wound?
Summary
Life course research frequently finds evidence on scarring effects from early career experiences and exposures for later life outcomes (Lucas et al, 2004; Brandt and Hank, 2014; Hetschko et al, 2014; Strandh et al, 2015; Heisig and Radl, 2017). If income inequalities tend to produce worries about retirement income, there may be significant differences between men and women in Sweden Another potentially relevant aspect relates to financial literacy. Whether detecting a significant impact of income in 1990 on the gender gap in pensions or not, women may still be prone to be more worried about their later pension income, potentially due to lower early career income and midlife experiences of precarious work. The HEARTS study (Lindwall et al, 2017) contributed with the psychological scarring aspect of the gender pension gap, i.e., worries about future pension income among older workers, who approach retirement age. We included income in 1990 to study whether this has an effect that goes beyond current earnings and household income
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
