Women and debt

Back to all Motions

2019 National Women's Conference
16 October 2018

Conference notes that in terms of issues surrounding gender equality, debt is rarely cited as a contributing factor in women’s overall financial status. However, the reality is that, in the UK, research proves that debt impacts women more than men.

Of the 8.8 million people struggling with debt in the UK, 64% are women (Money Advice Service).

In 2011, two thirds of declared insolvencies in the UK were women (Payplan).

According to the Insolvency Service 2017,

“The insolvency rate for females was higher than the male rate for the fourth successive year, and the gap has continued to widen. Insolvency rates were highest in the 35-44 age groups for males and 26-34 for females”

Low paid women are feeling the cost of living crisis sharply; nearly 1 in 2 say they feel worse off now than five years ago, leading to an increase in loans taken out by women (Fawcett).

Debt is a bigger problem for women for the following reasons:

A)Women earn less than men and according to the Fawcett Society, a women’s equality charity, women in Britain earn 13.9% less than men. This is as a result of various factors which includes:

• outright discrimination (where women are paid less than men for exactly the same work)

• unequal caring responsibilities (women are more likely to care for children and elderly/sick relatives than men – leading to unequal earning potential).

B. Women are more likely to be in lower paid jobs or unemployed. Part-time work is often to be found in lower skilled or public sector professions (which pay less) – 80% of those working in the care or leisure sector are women.

The Fawcett Society also found of those earning less than the living wage – two thirds are women.

Women are also more likely to work in the public sector and recent austerity cuts have therefore impacted women’s earnings further.

Female unemployment has risen to a 25-year high in recent years, while the number of unemployed men is falling.

Low or zero income makes women more susceptible to debt problems in order to meet the cost of household finances.

C. Childcare costs mean women are less likely to return to work after maternity leave.

• More than twice as many mothers than fathers have found that returning to work after having a child isn’t financially worthwhile, according to the National Childbirth Trust (NCT).

• This is particularly true for single mothers; each year a mother is absent from the workplace, her future wages will fall by 4% (Fawcett Society).

• Childcare, low wages and unemployment inevitably leads to more women relying on borrowing to pay the bills.

D. Women struggle more and take longer to pay off debt. Both men and women struggle with debt problems across the UK. However, women take longer to pay off debts and have less income to fall back on in the event of debt crisis.

On top of credit cards and overdrafts, debts such as student loans also hang around longer for women, depleting their income in the long run. Women graduates face 16 years of student debt while men would have paid them off within 11 years, according to the British Household Panel Survey.

A combination of motherhood and lower future earnings means that not only are women in more debt than men, they will carry debt for longer.

Conference therefore calls upon the National Women’s Committee to:

1)Work with the NEC to carry out a survey to identify the financial challenges faced by women members.

2. Promote UNISON’s There for You charity and the help it can offer to women members via SOGs, regions and branches.