Women’s entrance to the workforce is slowing, and that’s a problem
Congress must act to help the U.S. catch up with other advanced economies
OPINION — Here’s a conundrum facing the country: From the 1960s through the ’90s, women entered the U.S. workforce and earned college degrees in rising proportions. Then, around 2000, something changed.
Women continued to strive in higher education, earning college degrees of all types — and they now lead men by solid margins. But the percentage of women seeking full-time employment began to diminish, a retreat that has puzzled analysts since.
After 40 years of consistent increase, working-age women’s labor force participation fell from 60.7 percent in 2000 to 57.2 percent in 2016. What’s going on?
Women’s History Month has just ended, but this issue goes beyond questions of women’s rights, options and challenges. It’s a dilemma for our overall prosperity because women’s expanding role in the workplace has greatly benefited the U.S. economy.
Estimates suggest the economy is $2 trillion — or 13.5 percent — larger than it would have been if women’s participation and hours worked had remained at their 1970s levels. And despite pay inequities, to be highlighted Tuesday by Equal Pay Day, women accounts for most of the increases in family income since 1970, according to the Council of Economic Advisers.
Women’s employment roles are vital at every level, but especially in small businesses, a major source of employment growth. Fortunately, this is one area where female workforce participation has remained comparatively robust. A recent study commissioned by American Express found that from 1997 to 2017, the total number of small businesses grew by 44 percent, but the number of women-owned small businesses grew by 114 percent.
Still, the puzzling overall trend in female employment is impossible to ignore.
The decline can’t be explained away as part of a global phenomenon, because women’s labor-force participation is not falling in other advanced economies. Instead, the discrepancy must reflect something unique about America, and research points to two likely culprits: A lack of paid family leave and a dearth of affordable child care. These inadequacies amplify one another and can create significant barriers to women’s workforce participation, which in turn exacerbate equity gaps. Encouragingly, there is broad-based support for federal action legislation to address these inadequacies in the current Congress.
Paid family leave
Widespread public support for paid family and medical leave has prompted six states and the District of Columbia to establish a variety of programs for paid family leave. Still, 83 percent of workers don’t have access to a defined leave policy. Such policies don’t just benefit those workers, who disproportionately hold low-wage, often part-time or non-traditional jobs. Studies of state policies have suggested paid leave helps women stay at work, increasing workforce participation and boosting the economy for everyone. There’s momentum in the House and Senate. But lawmakers must reach greater bipartisan consensus to move this issue across the finish line.
Affordable child care
Congress last year nearly doubled funding for the Child Care and Development Block Grant to $5.2 billion. The strong bipartisan support for improved access to quality child care is encouraging. The Trump administration recently proposed further increasing the federal investment in child care in the 2020 budget, but there is more work to do. Even with this increased investment, less than 20 percent of those eligible for federal child care assistance receive it. The Bipartisan Policy Center is working not only to increase the investment but also to help ensure these scarce resources are well-spent by states, communities and providers. We also believe that the recently created Opportunity Zones present an important opportunity to improve child care facilities in underserved communities. Absent more child care capacity, it’s hard to imagine achieving the goal of bringing more moms into the workforce.
These two initiatives are pillars of BPC’s “Opportunity Agenda,” which seeks to increase economic security, health, productivity and mobility across the workforce. Other key components of this policy agenda include improved retirement security, making higher educational institutions more affordable and accountable, improving transportation and digital infrastructure, and confronting the still growing opioid epidemic. Each of these proposals are reflected in bipartisan legislation that has a reasonable chance of passage, even in our divided Congress.
Our nation’s economic and social health depend on willing and able workers joining the labor force. The economy has changed dramatically over the last generation and our workforce policies must improve to keep pace. There are many places where modest investments can pay great dividends, but none more important than those that enable parents to contribute to the economy and nurture their children. These are policies that can be adopted now.
We urge Congress to seize on this rare bipartisan opportunity to make our economy more productive, dynamic and inclusive.
Jason Grumet is president of the Bipartisan Policy Center. Maria Contreras-Sweet was the 24th Administrator of the U.S. Small Business Administration and is a member of the Bipartisan Policy Center’s Board of Directors.
The Bipartisan Policy Center is a D.C.-based think tank that actively promotes bipartisanship. BPC works to address the key challenges facing the nation through policy solutions that are the product of informed deliberations by former elected and appointed officials, business and labor leaders, and academics and advocates from both ends of the political spectrum. BPC is currently focused on health, energy, national security, the economy, financial regulatory reform, housing, immigration, infrastructure, and governance. Follow BPC on Twitter or Facebook.