Financial firms typically invest twice as much money into employees’ pension, when compared to other industries according to new research.
The study – by Profile Pensions – looked at average employer contribution rates across 14 different industries.
It found employers in the financial and insurance sector made pensions contributions equivalent to 9.5 per cent of an employee’s salary on average. Profile Pensions points out that with an average salary of £30,403 this products some of the highest pension contributions across any industry.
This was followed by the teaching professions, where teachers typically earn contributions equivalent to 9.3 per cent of their salary.
Those working in the electricity, gas, steam and air-conditioning supply industries also enjoy reasonable high pension contributions, with employers paying average contributions of 7.1 per cent of salary.
At the other end of the scale those working in agriculture, forestry and fishing jobs offered the minimum legal auto-enrolment contribution. This stood at 2 per cent when this figures where compiled – before the April 2019 rise in minimum contribution levels.
Those working in accommodation and food services get slightly more than this minimum – at 2.1 per cent, while those working int he arts get an average contribution of just 2.5 per cent of salary.
The research also looked at the different contributions paid to men and women. Overall there was a slightly higher contribution rate for men than women – at 4.6 per cent compared with 4.4p per cent. However, within individual industries the range varies significantly.
Education, in particular, favoured women, with an average employer contribution of 9.3 per cent, while men received only 7.9 per cent of salary.
In technical areas, however, men saw higher contributions. In electricity, gas, steam, and air-conditioning supply, for example, they saw 3.3 per cent higher contributions, with an average of 7.4 per cent paid into their pension, while women got an average of 4.2 per cent of salary. In in manufacturing, there was a difference of 0.9 per cent (5.3 per cent of salary paid to men, compared to to 4.4 per cent to women).
Profile Pensions’ chief investment officer, Michelle Gribbin says: “The difference between industries is remarkable. While some you might expect, like financial and insurance industries, the high pensions in education mean teachers are likely to be better off in retirement than those in typically high-earning careers like real estate or logistics.”
“As for the gender differences this is just another example of the pay gap between men and women in the workplace.
“Generally, we know women are more likely to have lower incomes and more interrupted careers as a result of their caring responsibilities. Ensuring this doesn’t penalise them is as much of an organisational culture issue as it is a government policy issue.
“Firms should really start to get to grips with the fundamentals and fully adopt a policy of ‘equal pay and pension contributions for equal roles’, applied to both full time and part time workers. As a further step, firms regularly reporting on gender disparities in income and pension contributions really helps ensure good transparency and commitment on this issue.”