Earlier this month, the Bureau of Labor Statistics released its employment report for September, which showed that women have been choosing to leave the workforce in staggering numbers: while about two hundred and sixteen thousand men dropped out of the workforce that month, about four times that many women made the same decision. Though the figures for September are particularly stark, they are consistent with trends that have been recorded since March. Unlike most economic downturns, the recession caused by the coronavirus pandemic has led to greater employment losses for women than for men. The unemployment crisis has been compounded by closures of schools and day-care centers, and the resulting caregiving burdens have fallen disproportionately on women.
I recently spoke by phone with Betsey Stevenson, a professor of public policy and economics at the University of Michigan, whose work focusses on the economic issues facing women in the workforce. Stevenson also served on the President’s Council of Economic Advisers, in the Obama Administration. During our conversation, which has been edited for length and clarity, we discussed why recessions usually cause greater unemployment rates among men, the economic and societal toll of inadequate child care, and what the past six months should teach us about paid family leave.
What do we know about how this economic calamity has impacted men and women differently?
The pandemic has impacted women differently from men in multiple ways. At the beginning, we really had a gendered shutdown, and that was because many of the industries that laid people off were industries where women were the majority of workers. A lot of people didn’t realize it early on, but a lot of health-care workers got laid off because they didn’t want people doing nonessential health care. And, if we think about private-sector education and health services, seventy-seven per cent of the jobs are held by women. So, early on in the recession, we saw lots of women laid off because, not surprisingly, women do a lot of the in-person work in the economy, the kinds of work that couldn’t be done remotely.
If you look at the people who were employed in February, more than three in ten women who were employed in February had time where they were not working over the next three months, so they were unemployed, compared to two and a half out of ten men. And it’s worth noting that this is actually really unusual in a normal recession.
How do recessions usually break down in terms of gender?
In a normal recession, men tend to lose jobs first because men tend to work in more cyclical industries—the kinds of industries where, when the economy goes down, our desire to make purchases from those industries goes down quickly. So, if you think about the last recession, it hit workers like construction workers early on, and it hit financial services early on, and those are more male-dominated industries. But every recession is different. Economic booms don’t die of old age; something has to kill them. I think COVID-19 actually really illustrated that point. We were just going along, and, boom, something killed it. That thing was COVID-19.
But in the kinds of things that have caused recessions in the past, the traditional thing is to see men lose their jobs first. And sometimes we’d see women losing their jobs later, which is what we saw in 2008, never quite to the same extent. But, as state and local governments start laying off employees, you see women are more likely to be government employees. So they lose the majority of those jobs, and that happened later in the 2008 recession. In fact, it was ongoing for many, many years after the 2008 recession ended, as state and local governments struggled to get their financial footing.
And so we started this conversation with what’s happened to women. Their industries got hit hardest early on, and we saw a lot of them get sent home. That’s kind of unusual. Now we’re actually seeing a second thing happening to women that’s not unusual—we’re starting to see the layoff of those state and local government workers, and that’s disproportionately women. And then the third thing that I’m sure you were thinking about, and we can talk more about, is this issue of child care, and we really are starting to see that take a toll on women.
My mother is involved in child-care advocacy, so she’d be very upset if I didn’t ask it. What precisely is the toll that child care has had on women?
I think the most shocking thing was the large decline we saw in September in women’s labor-force participation. It’s hard to know for sure what the toll of child care is, but it’s kind of like there’s a mystery to be solved, and we’ve got a couple of clues to the puzzle. And one thing that points to the toll of child care is a survey that was done out of Northeastern, by Alicia Sasser Modestino, in July. She found 13.3 per cent of working parents had lost a job or reduced their hours because of a lack of child care, and that two-thirds of parents who needed child care were reporting difficulty finding care, which is a number that was double of what parents reported before the pandemic.
Much more recently, the Philadelphia Fed reported in the Beige Book that half of manufacturers said a lack of child care was an impediment to bringing workers back. And more generally they were hearing increasingly from a range of employers that a lack of child care was a problem in bringing all their workers back. And then I think the most jarring thing for a lot of folks was seeing labor-force participation for women who are twenty-plus fall from 57.6 to 56.8 between August and September. That undid a lot of the recovery. And that decline was four times the decline we saw for men ages twenty-plus. I dug into the ages a little bit, and I think the thing that potentially points to an issue with child care is that the decline was really concentrated among women thirty-five to forty-four and women forty-five to fifty-four.
But the decline from August to September among those thirty-five- to forty-four-year-old women was from 75.2 to 73.6. That’s a fall of more than a point and a half in labor-force participation. That is huge. And the age group that had the biggest decline was thirty-five to forty-four. And it’s not at all surprising to me, in the sense that the people who are really struggling are people with young kids and multiple kids at home. It’s the parents who have a four-year-old, a six-year-old, and a nine-year-old, and those kids are at home, and they’re trying to do Zoom school. It’s really difficult. Even if both parents had the opportunity to work from home, that’s a really hard thing to manage. I want to make sure that I emphasize that that’s one kind of hardship, and then there’s another kind of hardship, which is parents or single moms who had an in-person job and no child care. The challenge of taking this big decline that we saw in September too seriously is that it’s one month of data. And we always say, “Ah, don’t trust that so much, because data is noisy, and we like to see longer patterns.” But, at the same time, that’s what we’ve got. And in September something real did happen: kids didn’t go back to school. The September drop was really shocking. If you take a look at what we consider “prime-age” women, women who are twenty-five to fifty-four, people who are normally in the labor force, we’ve seen their labor-force participation fall to where it was in the nineteen-eighties and it’s now back to where it was in 1991. It’s just such a big step backward, and it’s worth noting that, if you look at the recovery we had in labor-force participation of prime-age adults during the last boom, the one that ended in 2019, most of that was actually driven by women’s increasing labor-force participation, not men’s. So we saw women driving the recovery, and women have more education now than men. If you look at the annual data, for women with kids under the age of six, 2019 was an all-time high in their labor-force participation. And so we were at a place of just enormous progress. And I think that progress is at a real risk right now.
Given that you say that the losses from this recession are different from those of most recessions, how effective was the CARES Act, and how did it come up short?
The most important thing that the CARES Act did was stabilize household spending. So we saw household spending fall off a cliff at the beginning of the pandemic, and it wasn’t all due to state and local government shutting things down; people were frightened, and they didn’t go out and spend as much. And they were also frightened of what might happen to their jobs. We saw people cut spending enormously, and the CARES Act really stopped the worst of that, because it got money into people’s hands. And by May we saw that the worst of the recession was over, even though the worst of the pandemic hadn’t even occurred yet. It allowed people to pay their rent and put food on the table and do some spending that helped keep lots of people employed and helped employers bring lots of people back to work.
