ROSIE COULD RIVET BECAUSE SHE HAD AFFORDABLE CHILDCARE

A flurry of news coverage followed publication of the Bureau of Labor Statistics’ September jobs report, which found that 865,000 women left the labor force from August to September. In contrast, 216,000 men left the workforce during the same timeframe.

Adding to the alarm, analysis of the BLS data by the National Women’s Law Center noted that of those 865,000 women who exited the work force, 324,000 were Latinas and 58,000 were Black women. Further, of the nearly 22.2 million jobs lost in the U.S. in March and April due to the COVID-19 pandemic, only half have returned.

This comes as no surprise to us at the Institute for Corporate Productivity (i4cp); we’ve been tracking the issue of talent risk in the form of women leaving the workforce since well before the pandemic began.

As we noted in early August (“Employers Are at Risk of Losing Talent as Women Bear the Brunt of the Pandemic”), our research found that a little more than half (52%) of the 275 professionals we polled reported that more women than men have expressed concern about their ability to continue with their employment due to the need to homeschool children in the fall; 42% said that more women than men in their organizations had requested support resources to help meet childcare needs. And 7% said that more women than men had already voluntarily left their organizations due to the pandemic and related stressors.

It’s not a mystery as to why women are leaving the labor force right now. The jobs lost due to COVID-19 were disparately in fields dominated by women. And certainly, there are innumerable concerns and stressors driven by the ongoing march of the pandemic to include eldercare, but overwhelmingly the current exodus is about homeschooling and childcare pressures.

And it’s obvious that what could help to remedy at least some of this is a 21st Century version of the 1941 Lanham Act, which provided war-related government grants for childcare services in every state in the U.S. except for one. At the time, it was viewed as an experiment in universal childcare. The argument could easily be made that the experiment helped to win the war.

Rosie the riveter: A cultural icon created in part by expansive childcare services

The Lanham Act led to the creation of the first U.S. government-sponsored childcare center. In addition to using federal and local public funds for childcare initiatives, President Roosevelt also pushed for other new workplace strategies to include flexible work arrangements and staggering working hours. He also asked for flexibility from businesses to enable working mothers to go grocery shopping or do their banking at special hours.

The federal government also indirectly supported private employer-sponsored childcare during WWII. One example: several state-of-the-art childcare centers capable of serving more than 1,000 children of workers at the Kaiser Shipyards. Parents paid a nominal fee (about $9 a day in today’s dollars), and in addition to being affordable, the care was high-quality. Centers had low student-teacher ratios, served meals and snacks, and taught children arts and educational enrichment activities. Most of program operating expenses, including the cost of trained staff, was absorbed by the federal government—this was written into Kaiser’s defense-related contracts.

By the time the war ended, over six million women had become part of the U.S. labor force, helping to build the planes, tanks, ships, and other equipment that enabled victory for the Allies. They would not have been able to do so without affordable, quality childcare. Without it, we wouldn’t have the enduring persona of Rosie the Riveter, the ultimate team player, patriot, and breaker of barriers.

But after the war, the centers were soon closed, and women were encouraged to return home to make way for returning veterans who needed jobs.

Women were leaving the workforce well before COVID-19

The exodus of women from the U.S. labor force in recent years is not a new thing. Data from the Global Entrepreneurship Monitor found that in 2018, women made up 40 percent of new entrepreneurs in the U.S.—the highest percentage since 1996.

Factors of educational attainment, labor force participation, and pay inequity combine to make this a complex issue. And it’s a huge talent risk issue for corporations. Consider the fact that women are the most educated cohort in the U.S., but we consistently hit thresholds in our professional growth that we cannot seem to cross, particularly in making the important move up from middle to senior roles. So, women are more likely to strike out on their own and become entrepreneurs. Bureau of Labor Statistics’ data shows that women have been leaving the workforce in increasingly large numbers and this is expected to continue through 2026 (which is when current labor projections end).

Is it time for employers to step into the ever-widening void?

In the continuous pulse surveying i4cp has been doing since the start of the pandemic, we have asked about what organizations are doing to support working parents. The most common strategies are the usual—flexing work schedules, posting a variety of resources and other information to the company’s intranet, and expanding leave policies. But employers aren’t looking at taking more aggressive steps—just 8% of employers polled reported that were considering offering on-site childcare.

supporting working paretns

What is happening right now in terms of women in the workforce who are trying to perform under unimaginable stress, being forced to leave the workforce, and the corresponding regression of advancements made in pay and opportunity equity feels like the awful, multi-pronged rolling catastrophe that it is. This will affect culture—both at work and in the broader community for a long time to come.

And if that’s not enough to worry about, as Time reported in its September story, “COVID-19 Has Nearly Destroyed the Childcare Industry—and It Might Be Too Late to Save It,” childcare businesses are not able to survive the decreased enrollments and increased costs of operating due to the pandemic.

Hundreds have closed, and even if the Child Care Stabilization Fund bill currently in discussion were to pass (it passed in Congress, but is not expected to be passed by the Senate), experts say it won’t be enough to save centers that are hanging by a thread.

All of this feels like a wartime situation. With over a quarter of a million deaths in less than a year in the U.S. due to COVID-19--the largest mass casualty event since World War II (in which 291,557 were lost)--how can we not approach this as if we are under siege? It is a siege that calls for leadership, for innovation, and investment. It calls for employers to do more. The impact of the 2020 pandemic aside, I believe that at some point in the not-too-distant future, the provision of benefits and direct programming for childcare and eldercare for working parents will be elevated in priority on par with healthcare benefits.

What was learned from the Lanham Act is that investment in quality, affordable childcare helped to expand employment. And follow-up research found that the experience increased children’s educational attainment and future earnings.

Pandemic aside, in an era in which the cost of childcare can rival that of college tuition in some regions, revisiting the spirit of the Lanham Act is an idea worth exploring for employers that are looking realistically at the future and their ability to retain the talent they need to move forward. Some possible solutions for the challenges ahead may be found in the past.  

Lorrie Lykins is i4cp's Vice President of Research