Narrowing the Gender Wage Gap with Universal Child Care

By J’Taime Lyons

Fifteen years ago, it was possible for male and female lawyers to graduate from the University of Michigan Law School and get hired with identical salaries. Now, the gap between the salaries of men and women lawyers continues to grow, requiring many female lawyers to alter their career dreams. What happened over the last decade and a half? It’s simple. Child care has grown prohibitively expensive.

After World War II, the steady increase of women’s labor force participation signaled a revolution. Yet that progress stalled in the 1990s, and so has momentum that narrowed the gender wage gap. This is largely because child care has become too expensive, causing women to reduce their working hours or change their jobs altogether. Over the last 30 years, child care costs have increased by 70 percent, which is inconsistent with median wage growth. Mothers, more often than fathers, have to choose between a career and parenthood; many leave the labor force. Some mothers may intentionally switch to more flexible, but often lower-paying jobs.

This is not an issue just for women, but for the U.S. economy. Salary reductions for women cost the U.S. $57 billion dollars annually. The majority of this loss could be prevented if the U.S. had universal child care like most developed nations.

Universal child care is child care that’s subsidized and regulated by the government. It increases access to affordable, quality child care for all parents who choose it. Countries with universal child care options, such as Norway, Canada, and Sweden, also have high rates of women’s labor force participation—and higher rates for mothers compared to the U.S. In these countries, the reduced costs of child care provided by the universal option has attracted more new mothers to the workforce and increased their attachment to it. If the U.S. similarly increased mothers’ attachment to the workforce, our economy would grow by $1.6 trillion.

All other industrialized nations offer child care support as one way to reduce barriers for women in the workforce. Mothers’ employment is dependent upon the costs of child care, and when the opportunity costs of work are lower, they are able to pursue work opportunities similarly to childless or male colleagues. But the high opportunity costs of work have led to women being blocked out of many aspects of the labor force. Demand for child care is high, especially affordable child care, as 15 million children who are not yet school-aged have both or primary parents in the workforce.

Not surprisingly, upper management positions tend to be male-segregated. Men are moving up the income ladder, even as they become fathers, while mothers are moving down. In a phenomenon known as “statistical discrimination,” employers see women as risky investments for costly training due to the fact that some women leave their jobs to raise their children. In addition, time out of the workplace due to child care demands depreciates the value of the skills women earned in school or from previous positions. They reenter the labor market at a lower entry point than when they left. A system of universal child care would lead to more on-the-job training and increase women’s access to higher-wage positions and jobs.

Another factor that unfairly hurts women’s chances in the workforce is high-paying workplaces rewarding overwork and long hours. Both parents may be high earners, but society generally expects that the mother will need to be on-call for child care rather than the father, making it harder for women to meet the overwork requirement. That’s why overwork has led to an unequal departure of women from higher paying jobs as well as disproportionate rewards to workers who are able to work long hours.

Some may argue that children should be home with their parents, not in a child care center. But this is not a reality in the U.S. Since the 1970s, men’s wages have decreased, and both parents need to work in order to make ends meet. In 2019, most parents are in the workforce. Plus, as measured over the last 40 years, children increasingly live with just one parent. Research also shows that children who attend child care centers perform better academically and socially. Today, 75 percent of voters support federal funding for child care.

Others believe that some of these problems would be better solved if cash were given to parents via a child allowance, allowing parents to determine how to use the funds to care for their children. But such arguments ignore the fact that universal child care subsidizes the costs of care and enhances its quality. If parents were simply given cash, many children would still receive subpar early education. The market cannot ensure quality, but government intervention can. Finally, 51 percent of Americans live in “child care deserts,” meaning just access to child care is difficult. Government intervention would increase equitable access to child care for parents and their children.

For too long, we have been dependent upon the private sector to ensure our children have adequate care, but that dependency has only led to further inequity in our country. To remain a dominant force in the global economy, we need universal child care now. A strong economy depends on the elimination of barriers to women’s labor force participation and closing the gender wage gap.

Photo by bcgovphotos on Flickr

J’Taime Lyons is a dual degree MBA/MPP at the University of Michigan from Rocky Mount, North Carolina. She graduated with Honors from Wake Forest University. J’Taime’s hard work in her community is reflective upon her achievement of numerous awards, such as the Truman Scholarship. J’Taime intends to use her dual degree to make an impact in high poverty areas via increasing their collective impact so that all children are school ready and every community has a thriving economy. J’Taime currently serves as the SAC chair for the Ford School, VP of Ally Engagement for the Black Business Student Association, and a Board Fellow with United Way of Washtenaw County.