Wage gap, pricey child care keeping some women out of the labor market

By: - September 7, 2023 2:57 pm

A woman counts money on her desk. Photo by Getty Images.

Women continue to carry the load of full-time parenting and caring for sick and elderly family members, according to a pair of recent reports from the Minneapolis Fed. 

The gender wage gap and rising child care costs are key factors in keeping women at home — all while employers are struggling to fill open positions.

On average, women earn 82% as much as men, which has held steady over the past 20 years. Black and Hispanic women earn even less. At the same time, the cost of child care has increased, meaning a parent staying home with kids is increasingly a more attractive option for some families. 

In Minnesota, child care costs for a single toddler range from $165 to $290 per week — up to $15,000 per year, according to Child Care Aware

Nine out of ten full-time caregivers are women, according to the Minneapolis Fed analysis. Only eight percent of caregivers said they would rather have a job outside of the home.

The findings aren’t new; studies have long documented the gap in labor force participation rate between women and men. But the analysis also points to some continuing trends, like the growing employment gap between women with and without college degrees.

Married women with kids who have college degrees are more likely to work full-time now than they were 20 years ago. But over the same time period, women without degrees have stayed home with kids at about the same rate. 

Workforce participation among women is almost entirely driven by marriage, children and education levels — factors that have little impact on the employment rate among men. 

Unmarried men and women without kids are equally as likely to have full-time jobs. But when they get married and have children, women are more likely to stay home with the kids.

The opposite is true for men; married men with kids are slightly more likely to be employed full-time than those without kids.

Around 93% of married men with kids were employed full-time in 2022, while 72% of married women with kids worked last year, according to the Minneapolis Fed analysis.

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Madison McVan
Madison McVan

Madison McVan is a Report for America corps member who covers economic mobility for Minnesota Reformer. She previously covered agriculture for Investigate Midwest after graduating from the University of Missouri in 2020 with degrees in Journalism and Latin American studies.

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