Even though the stock market has soared since the beginning of the coronavirus outbreak in the U.S. in March, many workers are still uncertain they'll be able to save enough for retirement. And that's especially true among women and younger workers.
Women and Gen Z (defined here as ages 18 to 22) are far less certain they'll be able to save enough for retirement than their older, male counterparts, according to the 2020 Wells Fargo Retirement survey conducted by the Harris Poll in August of over 4,500 U.S. workers.
"More than 30% of Boomers, Generation X and millennials really were unsure if they were going to be able to save enough for retirement directly as a result of the pandemic, with those further from retirement expressing even more concern," says Nate Miles, head of retirement for Wells Fargo Asset Management.
In fact, 52% of Gen Z workers say that because of the pandemic, they don't know if they'll be able to save enough for retirement. The pandemic has also caused about half of Gen Zers to worry about the quality of life they'll be able to afford in retirement.
When it comes to women, only about 51% say they're confident that they're saving enough to be able to retire comfortably — compared to 68% of men. And 49% of women can't estimate how much they'll need in retirement versus just a third of men, the Wells Fargo survey finds.
Yet the lack of confidence is not surprising given that a greater proportion of women and younger Americans have been laid off, furloughed or experienced reduced work hours during the pandemic.
Even before the pandemic, Gen Z had a higher-than-average unemployment rate: 8.4% in April, May and June 2019. But it jumped to 24.4% this past spring when the pandemic hit, according to research from the Economic Policy Institute. Meanwhile, the unemployment rate for workers ages 25 and up was only 2.8% pre-pandemic and rose to 11.3% during April, May and June of this year.
For women, the pandemic and ensuing recession hit industries where female employment is more concentrated — restaurants, retail, hospitality, and health care, according to a working paper from the National Bureau of Economic Research.
The pandemic also shut down schools and day cares, causing many families to have to juggle work responsibilities with child care, a balancing act that, again, typically hit women's careers and jobs harder than it impacted men. Plus, fewer women occupy jobs that allow them to work remotely: 22% of women compared to 28% of men.
That's already translated into more job losses among women. Between August and September, 800,000 of the 1.1 million job losses among those over the age of 20 were experienced by women, according to the National Women's Law Center.
Income loss, of course, directly affects retirement savings. The median retirement savings among men is $120,000, according to Wells Fargo. Meanwhile women have just $60,000 in median retirement savings. Yet those levels drop significantly among those who say they've been impacted by the Covid pandemic. Men impacted have just $60,000 in savings, while impacted women have just $21,000.
"Unfortunately, while everyone is dealing with this pandemic, people are really dealing with it in various ways," Miles says.