Women’s participation in the workforce doesn’t just impact them individually – it impacts our entire economy

This is the first in a series focused on women’s economic security. This post frames up the issue. Check back for subsequent posts where we’ll outline possible solutions and proposals, talk to Minnesotans leading in this area, and share how you can get involved.

As anybody whose logged into social media the past week can tell you, women are the topic du jour of late. March is Women’s History Month. This past Monday we observed International Women’s Day. Meghan Markle is our feminist icon of the moment. And women are struggling to find their place in our economy in an extraordinary way since the pandemic hit.

By now, we’ve all seen the stories. Women have been forced out of the workforce at much higher rates than men since the pandemic began, both involuntary with layoffs and “voluntarily” (if you can call it that) to care for children who are out of school or sick family members. Our current economic recession has been branded as the “first female recession in the nation’s history,” and for legitimate reason. At a high level:

• Female unemployment hit double digits for the first time since 1948, with unemployment levels for BIPOC women being significantly higher than those of white women.

• In December 2020 alone, women accounted for all the nation’s job losses, losing 156,000 jobs while men gained 16,000. Furthermore, women of color accounted for nearly all these losses. In January 2021, another 275,000 women left the workforce.

• Women are driving involuntary job loss not only because we dominate industries (such as hospitality) that have been most impacted by the recession, but also because of discrimination when making decisions on layoffs, according to a University of Minnesota study.

• When it comes to voluntarily leaving the workforce throughout the pandemic, women were four times more likely to leave their jobs and three times more likely to sacrifice their careers for their family.

• Single mothers in particular are a sub-set of women facing incredible challenges due to the added stress of not being able to split home and child responsibilities with a partner. Single-parent homes already faced higher rates of poverty than two-parent households, with 30% of single mothers living below the poverty line and single parents spending more than two times their income on childcare.

While the pandemic has exacerbated women’s economic insecurity, it is not a new issue. Yes, women have taken great strides in our economy over the decades, and Women’s History Month is a great time to reflect on that progress and all the trailblazing women who fought for that (hello, Madam C.J. Walker). But the issues that are present now were present before, they just have a much larger spotlight shining down on them. Pre-pandemic, the median wealth of single white men under 35 was 3.5 times greater than that of single white women, and 224.2 times greater than the wealth of single Black women, according to the Brookings Institute.  Not only do women still make only about 80 cents on the dollar to men, but the balancing of work, family, and other caregiving responsibilities, coupled with the lack of a societal safety net in the U.S. to support women taking on these roles has led to these disparities.

A lack of universal paid sick and family leave pre-pandemic, and even more notably, the fact that this country was already facing a childcare crisis, are all underlying factors. As reported in the Washington Post, Princeton Economist So Kubota studied why the workforce participation rates of women have been decreasing over the past 20 years, and concluded that the rising cost of childcare resulted in a 13% decline in the labor force of women with young children, with similar results (12%) being concluded by the Center for American Progress. As we come out of the pandemic, it’s being estimated that between one-third to one-half of childcare centers may not reopen at all, due to added demands and precautions on already razor-thin margins. Fewer options for care are sure to result in higher rates, which further pulls women – especially low- to middle-income women – out of the workforce. And this isn’t just a problem for population centers, as the lack of affordable childcare options has been especially felt in Minnesota’s rural communities, with the industry at a breaking point.

It’s easy to look at the current economic disparities as a problem that is unique to women, but it’s much bigger than that. When women leave the workforce, settle for lower-paying jobs, or cut back on their hours, whether voluntarily or involuntarily, it has a domino effect that impacts future career opportunities, promotions, and equitable pay, which has consequences for not only the women themselves but also any children, spouses, or other family members that they support. But beyond that, and of consequence to everybody, it stymies economic growth. In order for the U.S.’s economic engine to thrive, we need women, especially BIPOC women, to be full participants in the workforce. The less women in the workforce, the less strong our state and nation’s economy. When women’s labor force rates drop, so does that of the country’s GDP.

To fully pull not only women, but our entire economy out of the current recession and achieve sustained economic growth at all levels, we must confront and work to address the underlying issues that are preventing women from being full participants in our workforce and economy at both the state and federal levels. This requires an acceptance and understanding that this isn’t just a pandemic issue. The good news is, there may be more momentum to finally tackle this than there has been in the past. The Walz-Flanagan Administration held a roundtable on this topic last week. Attorney General Ellison has instituted a task force focused on expanding women’s economic security. President Biden’s COVID relief package acknowledged the need, partially championed by Minnesota Senator Tina Smith. And there is no shortage of conversation happening at a state legislative and national congressional level, and within Minnesota’s advocacy and business spaces.

So, what are the possible solutions to finally addressing the need to even the economic playing field, and what needs to be done for them to become a reality? Check back next week to read my second installment where I’ll outline the ideas and proposals currently being discussed, and opportunities to make your voice heard.

Do you have comments about this topic, or ideas of how Tunheim can participate in addressing this issue? Email me at shinde@tunheim.com.