Giving Compass' Take:

• Jay Shambaugh, Ryan Nunn, and Becca Portman explain how policymakers can increase declining labor force participation among women.  

• How can funders work to develop and implement these suggestions? 

• Learn how low unemployment is increasing labor force participation. 

After decades of steady improvement, the labor force participation rate of American women peaked in 2000 and has declined since. As of September 2017, 25–54 year old women’s labor force participation rate was 75.2 percent (compared to 88.6 percent for men), below its 2000 peak of 77.3 percent.

Women’s labor force participation and the quality of women’s labor market opportunities are dual objectives, both contributing to economic growth.

This changing trend is a central economic concern. Since 1970, most of the increase in the typical household’s income has been due to women’s increasing labor market participation. By one calculation, GDP in 2013 was $2 trillion – or roughly 14 percent – higher because of the increase in women’s participation and hours above 1970 levels. By the same token, now that women’s participation is trending downwards, an important tailwind for families’ living standards has been removed.

The economics literature implies that short- to moderate-duration paid parental leave increases women’s labor force participation, enabling workers to better balance family and employment responsibilities. Evidence on the limited current child care support for American families suggests that our current policies are poorly designed and could be reorganized to target young children and low-income households.

Read the full article on women's labor force participation by Jay Shambaugh, Ryan Nunn, and Becca Portman at Brookings.