As any summer traveler knows, many people working in the tourism industry these days seem overworked and stressed. The leisure and hospitality industry has been hit far harder than any other industry in the US during the pandemic, and it’s still struggling to keep up with around 1.4 million job vacancies compared to pre-pandemic levels.
It’s not about a lack of demand — people might cut corners or vacation close to home, but they’re still traveling. In fact, post-pandemic travel spending hit a new high in May, according to the nonprofit US Travel Association.
In fact, the ongoing labor shortages in this industry point to a larger and more problematic trend, namely the loss of women in the workforce, particularly those without a college degree. This is a trend that has been developing since the 2001 recession; Since then, less educated women have experienced larger declines in labor force participation and slower recovery after each recession. But things have reached a new crisis point in the wake of the pandemic.
For example, women make up 53 percent of the leisure and hospitality workforce, and more than one in three jobs lost by women at the height of the pandemic were in this sector.
The same is true for many other low-paid service sectors, such as childcare. While overall U.S. employment as of May 2022 was 99.7 percent of where it was in January 2020, the employment rate in the childcare sector is still at 89.2 percent of its pandemic rate, according to the U.S. Department of Commerce. Other sectors, such as public sector work and education, are also lagging behind.
The bottom line? Women, particularly those at the lower end of the socioeconomic spectrum, are not returning to the labor market as quickly as they were before the coronavirus. In fact, female labor force participation in the US at the end of 2021 was 1.4 percentage points lower than before 2000.
This puts America very much at odds with the rest of the rich world. Over the same period, female labor force participation increased by 5.3 percentage points in France, 5.4 percentage points in Canada, 6.7 percentage points in the UK and a whopping 14.3 percentage points in Japan. Amazingly, Japan now has a larger percentage of women with no college degrees than the United States.
What’s happening? To sum it up in one word: childcare – or more specifically, a lack of decent, affordable childcare.
Department of Commerce statistics show that mothers with children under the age of five at home are generally less likely to participate in work outside the home, but this is particularly true for women with less education and lower wages.
Additionally, local studies have shown that in states with more daycare closures and more online schools, mothers have lower employment levels, and those who have access to care (whether through the state, private sector, or family) have higher work participation rates .
This is an issue that Gina Raimondo, the US Secretary of Commerce, has begun to address with business leaders. “We desperately need women without college degrees back into the workforce,” she told me recently in a conversation in Washington, “but if we don’t take care of the children, they won’t come back.” She pointed out, for example, that employers in would like to hire more women in certain very tight labor markets such as construction with high-paying jobs. But given that shift work can start as early as 7am or end after dinner, mothers with children and without access to affordable childcare, for example, cannot participate in union training programs for such industries. “People just don’t deal with the economics.”
In fact, the economics are pretty simple – more women working means more economic growth. A new study by the Conference Board’s Committee on Economic Development, released in late June, estimates that even a one percentage point increase in labor force participation for women ages 18-54 would have “several economic benefits, including about $73 billion in additional income.” . This could have a significant impact on consumption and job creation at a time when the US economy is expected to slow.
While many enlightened companies in industries like tech and finance provide access to good local childcare, there’s a strong argument that public care, not private, is the way to go here. For starters, it would cover all workers, including those in lower-paying industries and the increasing number of gig workers in the US who are putting together freelance jobs to make a living. According to the IBD Study, the median income of families using paid child care in the United States was $149,926 in 2020. Meanwhile, the median family income was $67,521.
It would also relieve corporations of the burden they must shoulder in the US to provide things that are best done by the state. healthcare is of course at the top of the list. As last week’s Roe vs. Wade coup made clear, companies are not only struggling with rising healthcare costs (which in many other countries are borne by the state), but also the politics of this concern. The interests of women and companies are actually the same, as is the case with the need for decent childcare.
https://www.ft.com/content/eb36dc5c-ec5d-4c8e-8eb3-c8f501ae56ac America needs to get women back into work