from the St Louis Fed
— this post authored by Meredith Covington, Manager, Supervision Policy, Research and Analysis Manager; and Ana H. Kent, Policy Analyst, Center for Household Financial Stability
During most of the coronavirus pandemic, women have faced higher unemployment rates than men, as the pandemic affected sectors with high shares of female workers, particularly in service professions. Moreover, the closures of schools and day care centers and the implementation of remote learning have increased child care needs, which disparately affect working mothers.
A September McKinsey study (PDF) shows that roughly a third of working mothers were considering taking a leave of absence, dropping out of the work force entirely, cutting their hours, moving to part-time or switching to a less-demanding role. Childcare responsibilities were a primary concern for most of these mothers.
This blog post discusses the short-term effects of the pandemic on working mothers, particularly on women of color, as well as the importance of affordable quality child care in preventing a long-term decline of women in the labor force.
Gender and Unemployment
Male and female unemployment rates typically track each other closely. Yet, men usually face more job losses during recessions. However, the opposite was true in the COVID-19 recession, as shown in the figure below.
From January through March of this year, the unemployment rate for women was the same as or lower than that of men. This trend reversed in April, however. The rate for women spiked more during the initial shutdowns and remained higher than the unemployment rate for men through September.1
Effects of the “She-Cession”
Official job loss is not the only setback for women. According to the Federal Reserve’s Survey of Household Economics and Decisionmaking (fielded in July 2020), a larger share of women than men (ages 25 to 54) lost a job, were laid off, were asked not to work any hours while still being paid, had hours reduced, or took unpaid leave since March. Women are also potentially facing riskier health conditions at work than men, as more women reported that their employer was taking insufficient precautions to prevent the spread of COVID-19, as shown in the figure below. Another recent study found that, from February through April, mothers with young children decreased their work hours four to five times more than fathers.
Certain demographic groups of women (Blacks, Hispanics, less educated and younger adults) have experienced proportionately greater job loss and continue to have very high unemployment rates as of November – 3 percentage points higher, on average, than in November 2019. (See the figure below.) In February, a larger portion of Black women (23%) and Hispanic women (29%) held service sector jobs that were particularly vulnerable to the pandemic than white women (15%). White women were also more likely than Black or Hispanic women to be in management and financial operations occupations that allowed work from home.2
Women Face Greater Caregiving Responsibilities
Prime-working-age women (25-54) were also slightly more likely to be caring for others financially (17%) than men (16%); women also were more likely to have minor children living with them (48%) than men (36%). Further, women provided close to 70% of child care during standard working hours.
Per our estimates using IPUMS CPS data, mothers and fathers living with their adult and minor children had similar unemployment rates, but the unemployment rate for mothers spiked more in the early months of the pandemic and remained higher as of November, as shown in the figure below. Black women were also taking on more responsibility as caregivers: Half of Black households with minor children are led by single women, who often juggle child care and virtual schooling with paid work.3
For single women, financial difficulties experienced during the pandemic are compounded by child care costs, which are already burdensome for many families. For example, average yearly infant care in Missouri is $10,041; the median family income is $58,329. Thus, Missouri’s average infant care costs are 17% of median income, about 10 percentage points higher than what is considered affordable.
A growing body of research shows the positive effects of quality, affordable and accessible child care on children, working mothers and the economy. Further, some recent research shows policies supporting such child care could also help enable racial and gender equity (PDF) among working women.
Potential Longer-Term Effects
During the pandemic, states’ unemployment insurance programs, combined with federal Pandemic Unemployment Compensation, have allowed for continued income to millions of households over the last eight months. However, due to intention in design, unemployment programs are a short-term solution, though many families face longer-term financial struggles and will continue needing assistance.
Further, unemployment assistance does not replace opportunity for upward mobility, as leaving the labor market and rejoining may lower a worker’s earnings trajectory. Other programs, like the Paycheck Protection Program, sought to keep workers on their existing payrolls through forgivable loans during the pandemic’s early stages, but evidence is unknown on its long-term effectiveness.
Conclusion
As the pandemic continues to upset work and home life, women of color, younger women and less educated women remain more likely to lose a job or work hours and shoulder the burden of closed or virtual schools and day cares. Further, the outsized implications of a pandemic recession on women’s employment undercuts the ability of families to weather financial shocks. The recession could also have a long-term impact on the progress working women have made in the U.S. labor market.
Notes and References
- Female unemployment was 16.2% versus 13.5% for male unemployment in April 2020. September numbers dropped to 8.0% and 7.7%, respectively, and in October and November, the female unemployment rate was again lower than the male unemployment rate, based on Bureau of Labor Statistics data retrieved from FRED.
- We define service sector jobs as health care support, food preparation, cleaning and maintenance, and personal care occupations.
- Federal Reserve Board’s Survey of Consumer Finances (2019) and authors’ calculations.
Additional Resources
- St. Louis Fed’s COVID-19 resource page
- The Real State of Family Wealth
- On the Economy: COVID-19 and the Great Recession: Market Hours and Home Production across American Households
Source
https://www.stlouisfed.org/on-the-economy/2020/december/she-cession-persists-women-of-color
Disclaimer
Views expressed are not necessarily those of the Federal Reserve Bank of St. Louis or of the Federal Reserve System.
