1% Increase In Women’s Labor Force Participation Could Lead To $72.8 Billion Boost In Income—And This Factor Makes A Big Difference

A new report indicates that a mere 1% increase in women’s labor force participation would have extensive positive impacts—and paid child care is a key factor.
Written by Claire Beaney
Reviewed by Kathleen Flear
Even a 1% increase in women's labor force participation would significantly boost their economic prospects, while also generating more growth and prosperity for the United States as a whole.
A new report by the
Committee for Economic Development
found that this 1% increase alone could lead to an additional $72.8 billion in income. However, as the study points out, access to paid child care is one of the biggest hurdles to getting more women to join the labor force—and obtain these key economic benefits.
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Access to affordable childcare a main blocker

The prevalence of paid child care in the short term corresponds with three factors: labor force participation, actual hiring of mothers, and an increased income.
Long-term changes in the prevalence of paid child care are also associated with three key factors: an increase in maternal labor force participation, higher income per capita, and overall male and female labor force participation.
Key factors that drive paid child care use in the US are labor force participation, higher household income, and obtaining education.
"The labor force participation rate for women and men has been declining over time—a trend that the pandemic has only exacerbated," Dr. Lori Esposito Murray, President of CED, said. "For women, access to child care is a major factor in deciding whether to participate in the workforce. As our new groundbreaking study demonstrates, increasing the labor force participation rate of mothers would unlock numerous economic benefits for women, their families, and for the country generally.”

Minor growth can make a major difference

There are a number of economic benefits that would come about as a result of a 1% increase in labor force participation among women.
  • There would be 569,100 more women working, including 210,700 mothers of kids under 14 and 44,900 mothers of kids under 5.
  • More than 126,000 kids would go to paid child care, including 121,800 kids younger than 14 and 47,900 kids younger than 5 years old.
  • Total real personal income would go up by $72.8 billion, with $26.9 billion going to mothers with kids under 14 and $5.7 billion going to those with kids under 5.
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