Universal Childcare Would Boost Women’s Earnings by $130 Billion

Concept of work from home and home family education.
ilona titova / Getty Images/iStockphoto

Since the start of the pandemic, women have lost a net five million jobs, and more than 2 million women have left the workforce entirely, with childcare obligations likely playing a large role, according to a new study by the National Women’s Law Center and Columbia University.

Discover: A ‘Staggering’ 2.6 Million Women Have Left the Workforce Since the Pandemic StartedExplore: Women’s Savings Are Shockingly Low – Inside the Gender Money Gap Made Worse by COVID-19

The study finds that universal child care would not only remedy this phenomenon but would also increase women’s lifetime earnings and retirement.

One of the key findings of the study is that over the entire life course, access to affordable care could increase the lifetime earnings for women with two children by about $94,000, which would lead to an increase of about $20,000 in private savings and an additional $10,000 in Social Security benefits. It would also boost the collective lifetime earnings of 1.3 million women by $130 billion.

In addition, the study notes that by the age of retirement, a lifetime of affordable childcare would mean that women with two children would have about $160 per month in additional cash flow from increased private savings and Social Security benefits.

Learn More: How Women in the Workplace are Faring Due to the PandemicRelated: The S&P 500’s Top 10 Companies for Women

Black and Latinx women would particularly benefit from increased earnings and retirement savings, with additional lifetime Social Security benefits of $13,000 and $12,000 respectively, compared to $8,000 for white women, the survey finds.

Another finding shows that expanding access to affordable, high-quality child care to everyone who needs it would increase the number of prime-age women with young children working full-time/full-year by about 17%, and by about 31% for women without any college degree.

Make Your Money Work for You

The study concludes that thanks to universal childcare, fewer children will experience poverty–resulting in better outcomes for their health, education, and earnings as adults, and more women will be able to enter the workforce or work more hours, boosting their income throughout their lives and enhancing their financial security in retirement.

More on This: States With the Biggest (and Smallest) Gender Pay GapFind: 8 Reasons Women Should Get a Financial Advisor Right Now

“All families will benefit from women’s higher earnings,” the study notes. “Families of color, families with low-incomes, and families where the breadwinner has an associate degree or less will see the greatest gains. In short, childcare carries a lifetime worth of benefits.

More From GOBankingRates


See Today's Best
Banking Offers