Women have borne the brunt of the Covid recession, accounting for 55% of net U.S. job losses since February 2020. In addition to those women who left the workforce, millions more have reduced their work hours or stepped back from career opportunities—losses that aren’t fully captured in official government statistics.
The reasons for these trends aren’t hard to find: Women account for the majority of workers in education, leisure, and hospitality, enterprises that have been among the hardest-hit by pandemic-related closures. In many families, women are also responsible for most childcare and eldercare needs, which have grown exponentially with the closing of schools and support services.
Women’s exodus from the workforce, or their diminished engagement, could have far-reaching economic consequences, ranging from a negative effect on the economic recovery to revised interest-rate expectations. It could even dent long-term portfolio returns.
Nearly two million women have left the workforce since February 2020. Men, too, have been hard hit by the Covid pandemic, but have seen a more pronounced jobs recovery so far. In March, for example, about two-thirds of net job gains went to men, according to the National Women’s Law Center.
Many women who lost or left their jobs haven’t just stopped looking for work, but now describe themselves as retired. Men are more likely to take a pause in their job search with the intention of returning to work, according to Gallup economist Jonathan Rothwell.
Two papers published recently by the Federal Reserve show that the recent jobs recovery has been especially elusive for mothers. While fathers and mothers of young children left the labor force at similar rates in April 2020, nearly all the fathers had returned to work by last November, while mothers had regained almost none of their lost ground, according to a February paper by the Minneapolis Fed.
Another paper just out from the San Francisco Fed found that if mothers had seen a recovery similar to that of nonparent women late last year, 700,000 more working-age women would have entered the workforce through December, according to Fed economists.
Prior to the pandemic, the U.S. economy was enjoying a Goldilocks expansion characterized by strong growth with little inflation, partly driven by a rise in female labor-force participation between 2017 and 2019. Since the pandemic, however, the seasonally adjusted labor-force participation rate among women 20 years and older fell by more than two percentage points to a 33-year low before ticking up in March to 57.4%. Men’s participation in the job market fell by two percentage points in the 13-month period that ended in March, but remains higher, at 69.5%.
The departure of women from the workforce is a key concern for the Federal Reserve. In a speech last month, Fed governor Lael Brainard warned of “scarring effects, with longer-term implications for household incomes and potential growth,” if the decline in labor-force participation among prime-age women because of caregiving demands isn’t reversed soon.