Lack of Public Support for Caregiving Contributes to Gender and Racial Wealth Gaps
Another factor that contributes to the gender and racial wealth gap is our national failure to invest in caregiving. Data shows that becoming a parent is a critical inflection point where income inequality deepens, which impacts lifetime earnings—and wealth. Up until they have children, women and men experience approximately equal rates of poverty, but once there are children to care for, these rates start to diverge. Black, Latina, and Indigenous women with children are most affected, experiencing the highest rates of poverty. Overall, a mother with one child earns 28 percent less than a childless woman over the course of her lifetime, and each additional child decreases her lifetime earnings by another 3 percent.
Most fathers, by contrast, do not experience any decrease in earnings and may even earn more—a discouraging disparity known as the “fatherhood premium.” Women also disproportionately reduce their hours of work or leave the workforce to care for children and family members, often to their own economic detriment. One study showed women who leave the workforce to care for family members lose on average $142,693 in wages and stand to lose an additional $131,351 in Social Security benefits.
Caregiving can be the ultimate act of love, but it is work. And as care worker advocate Ai-jen Poo puts it: care is “the work that makes all other work possible.” Unfortunately, the United States lacks a robust national care infrastructure to help workers balance work and family responsibilities. And research and experience (especially over the course of the pandemic) show that caregiving responsibilities—and the economic consequences that result from the lack of structural supports—fall disproportionately on women.
Take paid leave. Right now, the United States is the only industrialized nation without a comprehensive national paid family and medical leave program. Workers of color and low-paid workers are least likely to work in jobs that offer paid leave. Without paid leave, workers are forced to take unpaid leave, use up their vacation or sick leave, reduce their hours, or exit the workforce entirely to care for themselves or their loved ones, which reduces their household incomes. For some women, the need to balance work and caregiving pushes them into low-paid, part-time jobs, many of which lack paid family and medical leave and other benefits, compounding their economic stress.
Or consider childcare. As Treasury Secretary Janet Yellen recently summarized: Childcare in this country is “a textbook example of a broken market.”
Even before the pandemic, families struggled with the high cost and limited supply of high-quality childcare, and that supply has since been further depleted. Latina mothers are disproportionately likely to live in “childcare deserts,” where licensed childcare providers are limited or nonexistent. Women of color are also more likely to work in low-paying jobs with inflexible or non-standard schedules, meaning they need care after hours or on weekends when fewer providers offer it. When families cannot find or afford childcare, women tend to be the ones who reduce their hours of paid work or leave the workforce altogether in order to provide that care.
And even as families struggle to afford the cost of childcare, the Black, Latina, Indigenous, and immigrant women who are largely providing that care are inadequately compensated and in economically precarious positions themselves. The lack of public investment in affordable, high-quality childcare harms the economic security of both the women providing that care and those who need to access it.
In addition, our nation has historically underinvested in home- and community-based services for people who are older or disabled, leaving families—especially women—to bear the costs of providing that care. Women make up a disproportionate share of those caring for aging or disabled parents, spouses, or other adult family members. Particularly for women who are “sandwich” caregivers—caring for both children and older adult family members—balancing unpaid care work and paid employment can feel impossible, but reducing hours of paid work or leaving the workforce only compounds their short- and long-term financial stress. Women also represent a disproportionate share of the workforce providing that care, who are themselves underpaid.