New Federal Reserve data indicates women took the biggest financial hit during the pandemic

Federal Reserve Chair Jerome Powell expressed concern Monday that the pandemic recession has had an unusually harmful economic effect on women, who have been forced to shoulder additional responsibilities for childcare, forcing many of them to leave work.

“As schools closed and childcare services shuttered during the worst of the pandemic, that added responsibility and stress made working more difficult for some and took many away from their jobs,” Powell said in remarks to a Fed conference on gender and the economy. “These burdens are real and have been an additional challenge during an already challenging time.”

Women, particularly mothers of young children, are still less likely to be working or looking for work than are fathers or women without children. Childcare has become increasingly expensive and difficult to find, with many school after-care programs having yet to fully reopen. During August and September, working mothers lost jobs even though the nation’s overall unemployment rate fell and an average of 400,000 jobs were added each month.

The departure of so many mothers from the workforce is a big reason why the proportion of Americans who are either working or looking for work remains below pre-pandemic levels even while employers are scrambling to fill a near-record total of available jobs.

When the pandemic recession struck in March 2020, women, who were more likely to hold frontline jobs in health care, at grocery stores and in other public-facing industries, suffered greater job losses than men, the reverse of what happens in most recessions, Powell noted. In April 2020, the unemployment rate for women was 16.1%, much higher than 13.6% for men, though the rates are now nearly equal.

And in 2020, Fed data showed that 70% of parents reported that the pandemic disrupted childcare or in-person schooling, and 25% of mothers in a Fed survey said they did not work or worked less as a result, Powell said.

“Long-standing disparities weigh on the productive capacity of our economy, which can only realize its full potential if everyone has a solid chance to contribute to, and to reap the benefits of, broad-reaching prosperity,” Powell said.

Powell’s remarks coincide with new research by Stephanie Aaronson, a former Fed economist who is director of economic studies at the Brookings Institution. Her research concluded that other factors have also likely depressed women’s participation in the workforce. Since women were overrepresented in such hard-hit service industries as restaurants and retail, many of them may be reluctant to return to those in-person jobs until the pandemic is further under control, the study found.