Female Employment: The Missing Piece in Our Puzzling Economic Stagnancy

January 25, 2014 • Blogs, The Globalist Notebook • Views: 826

BY ANNA RUSSO:

When the December jobs numbers were released about two weeks ago, economists, policy makers, and citizens throughout the US sipped their coffee, frowned, and lowered their hopes for economic recovery while looking at that fateful number: 74,000.  The 74,000 new jobs added in December is significantly below the 197,000 economists were expecting. The US employment-population ratio has been hovering at a few points under 60%, and it stayed that way at 58.6%.

(US Bureau of Labor Statistics)

(US Bureau of Labor Statistics)

This stagnation is characteristic of the 2008 recession. While every other dip in employment was followed by an almost immediate rebound, this one bodes a much slower recovery. So the scramble is on to find a new cure for our economy that seems like it just can’t rid itself of its perpetual sickness, and one path offers itself as worthy of exploration: women in the workforce.

One indicator of the potential importance of female labor is the fact that all of the job gains in this month’s dismally low addition to US employment numbers were from new jobs given to women. Of the 74,000 net job additions to the economy, 75,000 women were hired and 1,000 men lost their jobs. These job were primarily additions in low-skill, low-wage jobs in the retail and service and hospitality sectors. However, in the overall labor market, females occupy a greater share of high-skill, high-paying jobs, for example in the world’s preeminent gender-equal economies like Sweden and Norway. This bodes well for the importance of female employment in our economic development, where addition of high-skill jobs is often very hard to come by. Women are now entering the work force more educated than their male counterparts, which also make them a target for job additions.

However, women’s employment has remained stagnant since the 1990s. If we are to harness this educated potential labor force to kick-start our economy, we have to adjust labor policy. A real change in our unemployment numbers will necessitate a two-part policy change, one targeting wage equality, and the other focusing on support for working families. 

(SOURCE)

(The Council of Contemporary Families at the University of Miami School of Education & Human Development)

The debate over equal pay for equal work is well understood; it is only fair for women to be paid the same amount as men for the economic output they provide. Enforcing equal pay in the US will not only increase fairness inherent in our country’s ideal of equality. Bumping up women’s wages to the level of men’s will help raise many families out of poverty.

The second change, however, would revolutionize what it means to be a working parent. The US is lagging behind almost every wealthy nation (defined as “wealthy” based on data compiled by the World Economic Forum) in its support for work-family balance. In a study sponsored by futureofchildren.org, a collaboration between Princeton’s Woodrow Wilson School and the Brookings Institute, every other country with low unemployment and a healthy economy has legislation guaranteeing paid leave for mothers, while the US is the sole country that does not. More than half of these nations offer paid paternal leave, while the US does not. Almost every other country guarantees annual paid leave and a weekly day of rest to spend with family, while, once again, the US lacks such legislation.

This lack of legislation has serious implications on women’s desire and ability to obtain high level jobs that would contribute productively to the economy. A survey conducted by the Pew Research Center demonstrates that in all age demographics, but most markedly once women reach their 30s and 40s, women are less likely than men to aspire for promotions or top managerial jobs. 51% of women reported that they found it difficult to pursue a career while also being a parent, as opposed to only 16% of men. 

(SOURCE)

(Based on updated data from Jody Heymann and Alison Earle, Raising the Global Floor: Dismantling the Myth That We Can’t
Afford Good Working Conditions for Everyone (Stanford University Press, 2010))

Women should be guaranteed equal opportunity in the workplace, regardless of whether or not they choose to have a family. Quality child-rearing and participation in the labor force are both imperative to our nation’s health; we need to provide an environment where women do not feel the need to make a choice, because a choice in either direction could be catastrophic.

A study in 1992 by a University of Pennsylvania Wharton School of Business professor surveyed his students and found that 78% of them planned to have children. In 2012, in the same study, the number almost halved to 42%. Our current birth rate is already dangerously low when thinking about supporting the soon to be very large number of baby-boomer retirees, and a sudden drop in population due to an increased desire for corporate success could shake our system entirely.

Is increasing work-life balance and female employment the magic end to all our economic troubles? Maybe, maybe not. But when deciding to balance motherhood with corporate success, to work or not to work should never be the question.

Anna Russo ’17 is in Berkeley College. Anna writes about women’s issues around the world, focusing on health and education. Contact her at anna.russo@yale.edu.

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