How The Pandemic Is Making The Gender Pay Gap Worse
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"Mancession" might sound like the name of an awful jazz fusion band, but it's a term that the economist Mark Perry helped coin a decade ago. It described how the Great Recession, like the three recessions before it, disproportionately hurt men.
In typical recessions, consumers cut back spending on expensive items like cars, refrigerators, computers and houses, which ravages manufacturing, construction and other industries that disproportionately employ men. Men's unemployment numbers shoot up. Meanwhile, female-dominated professions in areas such as education, health care and in-person services tended to be more recession-proof. And, in what's known as "the second-earner effect," many women actually enter the labor force or increase their work hours during recessions as a way to help their families while the primary male breadwinner struggles. This helps tamp down the female unemployment rate.
It's playing out differently this time, according to a new study by economists Titan Alon, Matthias Doepke, Jane Olmstead-Rumsey, and Michèle Tertilt. They find that this recession is hitting women harder. Between February and April 2020, male unemployment increased 9.9%; female unemployment increased 12.8%. The pandemic has ravaged in-person service jobs — at restaurants, hotels, pilates studios, retail outlets and so on — which are disproportionately done by women. Men are more likely to be able to work remotely, and male-dominated construction and manufacturing, while down, have also proven to be relatively pandemic-proof. Since April, the gender unemployment gap has narrowed, but the women's unemployment rate remains almost a percentage point higher than men's.
The unemployment rate is only part of the story. "This recession is not just a labor market shock, but it's also a huge shock to the requirements for time spent at home," says Olmstead-Rumsey, an economist at Northwestern University. Women are getting hit hard by the closure of schools and day care facilities, which have forced kids to stay home. Even in families where both Mom and Dad work full time, the average mom does almost 60% of the child care in normal times, about three more hours per week than dad, Olmstead-Rumsey says. Those working moms spend six more hours per week on child care than dad if the couple has a child younger than 5. The pandemic has increased this burden by making it harder for families to outsource caregiving to schools and day care facilities.
We kinda already knew some of this. Planet Money's own Mary Childs and Stacey Vanek Smithrecently appeared on NPR's It's Been A Minute to discuss these issues, and you should totally listen to the show.
Before the pandemic, the average American female worker earned only 81 cents for every dollar the average male worker made. If this were like past recessions, the economists find, the gender wage gap would actually shrink by about 2 percentage points, with women earning about 83 cents to the man's dollar. This, the economists say, was mainly the result of that second-earner effect, which set women on a trajectory to gain skills and experience and better jobs that help them close the pay gap with men, who, meanwhile see their skills and experience and job prospects atrophy during the recession.
But with the service sector in disarray and the kids at home during this recession, many women aren't able to get a new job or increase their hours, says Michèle Tertilt, an economist at the University of Mannheim in Germany. Women are now more likely to drop out of the labor force or cut hours, hurting their future job prospects. It's why the economists project that, instead of shrinking, the gender wage gap will widen by five percentage points, so that the average female worker will earn about 76 cents for every dollar the average male worker makes. "We project it's going to take more than 10 years for the gender wage gap to close to what it was before the pandemic," Olmstead-Rusmey says.
The economists' projections may be depressing. But they also see a silver lining. Both co-authors we spoke with pointed to research by Harvard University's Claudia Goldin, who finds that the primary driver of the gender wage gap is "female demand for temporal flexibility." Women, disproportionately burdened by familial responsibilities, often choose or are forced into jobs that offer more flexible work schedules, and these jobs tend to pay less. For example, a female lawyer who wants kids might pick a job at a lower-paying nonprofit law firm with flexible hours instead of a corporate law firm, which has insane hours but a huge salary.
"One of the last barriers to breaking down the gender wage gap is to offer greater flexibility in these really high-paying jobs," Olmstead-Rumsey says.
The pandemic might eventually help on this front by ushering in a new era of remote work, which offers much more flexibility to professionals with kids. "And so if we can keep these teleworking arrangements that many of us have now after the pandemic is over, this can really help parents — particularly mothers of young kids — to keep working," Olmstead-Rumsey says. "Teleworking basically allows parents to better combine working with child care." The problem now is the kids are teleworking, too. If kids go back to school, but parents don't have to go back to the office, it could make the gender pay gap smaller.
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