The Cost of Not Supporting Working Women

By Kiese HansenBill Emerson National Hunger Fellow

In the last 50 years, women have made great advances in the workplace. Forty percent of businesses are currently women-owned. Women have also surpassed men in educational attainment. And a record number of women are serving in Congress. Despite this progress, women continue to face unfavorable policy and work environments. Comprehensive work and family supports are needed to generate better outcomes for women and strengthen our economy.

From 1950 to 1990, women’s labor force participation rate exploded from 33 percent to 57 percent; however, the rate has since plateaued. Relative to other developed countries, one study found that U.S. women’s participation has decreased 28-29 percent – a decrease largely attributed to a lack of worker protections like paid family and medical leave and benefits for part-time workers. This has severely undermined our economy. Because of women’s low labor participation, we’re losing out on an additional $500 billion in economic output per year. Research also shows that reducing occupational barriers for women leads to GDP growth.

Four key policies would help women across the country as well as their employers and the communities where they live. These policies would improve job quality for all workers, particularly low-income women and women of color, and result in increased workforce participation, improved financial stability, and long-term economic mobility.

1. Raise the minimum wage.

Women are disproportionately represented in low-wage and tipped work. Sixty-six percent of tipped workers are women. If the federal minimum wage increased to $15 an hour (including an elimination of the tipped minimum wage), 23.1 million women would receive a raise.

Maintaining a low minimum wage deprives women of improved quality of life and increased purchasing power. Raising the minimum wage is a proven method to combat poverty. For minimum-wage workers and their families, a wage hike would increase household income and spending, which in turn would stimulate the economy.

2. Expand access to paid family and medical leave.
The U.S. sorely needs a federal paid family and medical leave policy. The Family and Medical Leave Act (FMLA) provides workers 12 weeks of unpaid leave. FMLA is cost-prohibitive for working mothers who need continuous income to meet basic needs. Moreover, 40 percent of workers aren’t eligible for FMLA. 

Without paid leave, many women are forced to quit their jobs or reduce their hours to care for themselves or a loved one, losing an estimated $9.6 billion in wages per year.

3. Ensure all workers get paid sick days.
One in five mothers in low-wage work report losing a job to take care of themselves or a family member. Job loss is an income shock that can have severe short-term and long-term consequences (difficulty paying rent, bills, and other expenses). For employers, it leads to turnover. The cost of replacing an employee is usually 16-20 percent of an employee’s annual salary.

In contrast, the costs of implementing paid sick days in the workplace are negligible. After Connecticut passed its paid sick days law, employers reported minimal impact on their overall administrative costs and business operations. Other states and jurisdictions with paid sick days laws have reported similar findings.

4. Guarantee fair scheduling.
Two-thirds of workers in low-wage and part-time work are women; these positions often have unpredictable schedules and inflexible hours. Volatile scheduling compounds the challenges detailed above. It’s hard to plan—manage finances, budget, take time off—when you don’t know when or how many hours you will be working.

The instability caused by unpredictable scheduling has an outsized impact on employees and the businesses that employ them. Guaranteeing stable, predictable scheduling for all workers would improve employee health and productivity.

Low wages, stress, and unemployment are unacceptable costs of our failure to support working women, especially when ready solutions are on the table. Policies to raise the minimum wage, expand access to paid family leave, ensure workers get access to paid sick days, and guarantee fair scheduling would have a tremendous impact on women in low-wage and part-time work. Not pursuing these solutions causes undue harm to households across the country and withholds billions from the U.S. economy.