May 1, 2009

Which Moms Stay at Home?

Real Time Economics, a blog at the Wall Street Journal, looked at a forthcoming Census Bureau report about "...the phenomenon of women voluntarily leaving the workforce after having kids." That the report finds both the poorest and richest families are the ones whose mothers leave the workforce doesn't seem too surprising; what isn't addressed but seems more significant is that the child care industry relies almost solely upon the middle class for its customer base. (What does that say about American family values?)

One of the potential problems with this blog post it that it only addresses the economic factors in this type of decision (more specifically, family income levels); It doesn't address any non-economic reasons for why women might stay at home to raise their children. Likewise, as one woman commented, the report (at least as commented on by the WSJ) only talks about women who stay at home and not about any men who might do the same.

...[M]ost working women return to the work force a year after having a child. With women’s earnings making up a significant chunk of household income, the demographers say, families may find it too costly to punt on a second paycheck or an additional retirement account.

The Census study found that women at the highest income levels (those above $200,000), or whose husbands are at the highest income levels, are slightly more likely than median income earners to opt out of the labor force — meaning that, indeed, some rich women bail out on work to raise their kids.

Another group that was more likely to opt out were women with household incomes less than $50,000 — and among that group the opt-out effect was largest among those with household incomes less than $20,000. In other words, they can’t afford child care so they stay home instead of working.

HT: Economist's View


Kay said...

Salaam 3alaikum,

The stay at home issue is something I think about and I don't even have a family of my own yet!

I have a fairly good income potential and I think: this can fund their college education. At the other end, I ideally would want to homeschool my children because I don't think public education is accelerated enough and it doesn't focus enough on the arts, mathematics, and foreign language, among other things. Isn't there a balance one can make?

I think that women are "punished" for having children in the US, and they leave them too early in critical developmental stages of the child's life. The workforce is still geared towards men or people who haven't had children yet despite the fact that women entered the workforce in my mother's generation.

What about more part time hours? What about using technology to work remotely from home? What about companies making contracts for the women to come back to work at the same company after x time and using temp agencies to fill their place? Why are these tools not more commonly used?


JDsg said...

Wa 'alaikum salaam, Kay.

All very good questions. Some of your points are well taken, but also lead to unintended consequences and/or people breaking the law. For example, you asked about women coming back to work at the same company, using temp workers to replace them, while the regular employee is on leave. Some companies will do this, of course, and others will penalize (or punish) women for having the babies, as you mentioned. A friend was fired from her job after her pregnancy became noticeable to management. That's against the law, and we told her to fight it, but she wouldn't, in part because she and her husband were on employment passes at the time and not permanent residents (green cards). Temp agencies can be popular with management (and I've done some temping myself; it certainly paid the bills while I was looking for permanent work). But the downsides are several: temp workers cost a lot of money (the agency needs their cut, plus all the other monies for taxes, etc.), the convenience of temp workers may cause them not to be able to become permanent workers (i.e., management may decline to convert them into permanent employees, finding it cheaper in the long run to stick to temp/contract employees), and so on. And, of course, there may be other reasons why women don't want to return to the workforce. My mom and two of my sisters have been stay-at-home moms; in their cases, raising kids themselves was the much higher priority than family income (hence my jibe at so-called American family values). It's certainly not a black-and-white topic from several different perspectives. Which is why I thought it was worth writing about. :)