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Women in the workplace – The imperative of Childcare for Economic Recovery

Article By Alison Gross for Daintree Advisory

The pandemic is deepening pre-existing inequalities for women in the workplace, exposing vulnerabilities in social and economic systems which are in turn amplifying the long-term impact of the pandemic in unanticipated aspects of our society and economy.

According to the Bureau of Labor Statistics, women held 50.04% of American jobs in December 2019. In September 2020, 865,000 women had dropped out of the labor force in the United States, compared to 216,000 men. This means that women are exiting the workforce at 4 times the rate of men.

According McKinsey’s Women in the Workplace report 2020’, data shows women and men left their companies at similar rates before the pandemic. However, the study found that, since March of 2020, mothers have been three times as likely as fathers to be responsible for a majority of housework and childcare during the pandemic, and that is in addition to their professional work. The McKinsey report states that one in four women are thinking of downshifting their careers or dropping out of the workforce.

In a July 2020 article for the Washington Post, headlined, ‘Coronavirus child-care crisis will set women back a generation’, Alicia Sasser Modestino, Director of Research, Dukakis Center at Northeastern University wrote: ‘Some advocates anticipate a wave of permanent [childcare] closures, leading to the loss of as many as 450,000 child-care slots. In a recent survey, half of parents of young children in Massachusetts said they “will not be able to return to work without a consistent child-care solution.”’

There were nearly 10 million mothers of young children in the labor force in 2019. Insufficient childcare could affect their work, their wages, their long-term economic outcomes, and the economic recovery. Half of the United States has too few licensed day care centers. So called “childcare deserts have existed for years and according to a 2018 Center for American Progress study, the average family can spend as much as a third of their income on day care. The child care sector was already failing to support all families, now 4.5 million child care slots could be lost permanently.

We urgently need Investment for childcare infrastructure at a local level. One solution would be to provide additional funding for day care, giving parents the flexibility they desperately need without dictating a one-size-fits-all solution across school districts. If Congress does not act now, it is likely that there will be little left of the child-care system when the economic recovery is fully underway and the consequences could set women back a generation, as Modestino described.

In February 2021, the New York Times reported that the Federal Reserve chair, Jerome H. Powell, suggested that improved childcare support policies from the government might help pull more women back into the labor market. While the central bank is independent of politics, and avoids getting involved in partisan debates, this clearly indicates that the subject of women in the workforce is top of mind. Mr. Powell commented that women in some other major advanced economies, such as Canada and Germany fare better than women in the US. The article reports:

‘Research has suggested that this may be linked to childcare policies. In a 2018 paper that asked why the share of Canadians who work had climbed even as United States labor force attachment had fallen, researchers at the Federal Reserve Bank of San Francisco pointed out that most of the gap owed to different outcomes for women. And they pointed to caregiving policy differences as a likely culprit.’

Community-led childcare centers have been long established but their capacity cannot meet the new demand. State licensed centers are required to follow a set of basic health and safety requirements for which they are monitored. Some examples of center-based programs include: early childhood programs operated by schools, school-age before-and afterschool programs, faith-based programs, part-time programs, including some nursery schools, preschools and prekindergarten programs.

Questions to drive action should include:

· Can these existing centers be used to grow capacity by leveraging their experienced staff for leadership and training for new centers?

· Can government funding provide facilities and equipment and pay for training? and

· Can the threshold for government assistance be raised so that more people can have access to help with the cost of the childcare that such centers provide?

In addition to government assistance for community-led childcare programs, we need more large corporations to step up and provide on-site childcare for their workers in their operating locations and office headquarters. Dean Carter, the Chief Human Resource Officer of Patagonia sees childcare as one aspect of the “family-affirming policies” offered by the company. Parents can not only drop in on their children at daycare, they can bring their children into the office. This should be part of best practice criteria and a key measurable asset for ‘Best Places To Work’ lists in the future.

Local, state and federal legislators, working together with business leadership need to urgently address the issue of our childcare. Full economic recovery for this country depends on it.

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