Good morning,
The post-pandemic talent crunch is challenging and isn’t ending anytime soon. Increasing the participation of women in the workforce is one of the key solutions to this challenge, but barriers remain.
In the U.S., equality in the participation rate between women and men would add almost eight million employees to the workforce, according to a new report released on Thursday by global investment firm Kohlberg Kravis Roberts & Co. L.P. (KKR). However, the cost of childcare in the U.S. “is currently a major headwind that will likely require a major overhaul,” the report on macroeconomic trends finds.
Fortune’s Megan Leonhardt looks into this issue. “Millions of Americans—mostly women—grapple with the financial breaking point of childcare,” Leonhardt writes in a new report. “Around 4.5 million Americans remained unemployed in January because they were caring for children not in school or daycare.” And as of January, “There were 217,000 fewer women in the labor force than in February 2020,” she writes.
Leonhardt spoke with women who’ve decided to drop out of the workforce rather than put more than 25% of their paycheck toward the cost of care. For example, Jennifer Parks worked in pharmaceutical manufacturing until the birth of her oldest seven years ago. Parks left the workforce because she couldn’t find affordable childcare. “When we started running the numbers, there was basically no way that we could really cut childcare that made it cost under $100,000,” she told Leonhardt. (You can read the complete report here.)
A recent World Economic Forum report explains how the pandemic negatively impacted women much more than men: "While women constituted approximately 39% of the global workforce, they suffered 54% of the job losses. The report suggests that employers "look at increasing childcare subsidies and expanding childcare coverage to all parents with children up to the age of 18."
Over the next 10 years, labor issues will be more of a concern than inflation or supply chains and cost inputs, predicts Henry McVey, chief investment officer of KKR’s Balance Sheet, and author of the report. "Worker tenure and rate of turnover will be important benchmarks for companies to monitor,” McVey says.
Or, here's an idea: Maybe more job offers should come with a health plan, 401(k), and yes, a childcare subsidy.
Quick note: Following the release of CFO Daily's Guide to Becoming a CFO last week, I've heard from some readers who wanted recommendations for books on leadership. Is there a book that deeply resonated with you on your career journey? Let me know. I'll compile a list and share it.
Have a great weekend. See you on Monday.
Sheryl Estrada
sheryl.estrada@fortune.com
