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The Regressive Effects of COVID-19

by Maria Alexandra D'agostino       
          July 7th, 2021

As the spread of the respiratory virus, COVID-19, began to wreak havoc on the lives of millions of individuals across the globe, women were one of the largest groups disproportionately affected. Also known as the gender pay gap, the average difference between the earnings of men and women, is one of the various aspects of the gender gap struggles that women endure everyday and one which has been especially exacerbated during the pandemic. Though in the midst of the pandemic, women held more jobs than their male counterparts for the first time in almost a decade, comprising 50.04% of the American labor force, women make up the largest portion of American jobs lost due to the pandemic and therefore their representation in labor force will decrease. This is a result of several factors, including societal expectations of women to take responsibility for changing family needs in a COVID-19 world. Policy that more directly addresses the gender pay gap is necessary to improve conditions for women in the US and abroad.

In January 2020, the respiratory virus, COVID-19, began to wreak havoc on the lives of millions of individuals across the globe, forcing companies to close indefinitely, lay off workers, and file for bankruptcy. Over two million people have died due to the virus worldwide, and over ninety million have been infected. As of January 2021, the death rate of Americans due to the COVID-19 pandemic had exceeded the number of American soldiers who died in World War II.

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Flags line the National Mall during the Inauguration of President Joe Biden.

Source: Chairman of the Joint Chiefs of Staff

As Americans began to worry about how they would obtain their next paycheck and the wearing of face masks became a political controversy, one of the largest groups disproportionately affected by the pandemic remained largely ignored: women.

The effects of COVID-19 on women extend past health and into the realms of domestic violence, child care, unpaid care work, and the economy.  In December 2020—during the midst of the pandemic—women held more jobs than their male counterparts for the first time in almost a decade, comprising 50.04% of the American labor force. However, the number of women in the workforce has significantly declined since the start of the pandemic in April 2020, as women have lost 5.4 million jobs, almost one million more than their male counterparts. The economic effects of the COVID-19 pandemic on women will impact all aspects of the movement for gender equality. However, with more women staying at home during the pandemic to take care of their children and becoming unemployed, the gender pay gap will be particularly exacerbated by the COVID-19 pandemic on both the national and international levels, and therefore requires additional attention.

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Comparison of jobs lost in the US by women and men due to COVID.

Source: Center for American Progress

The Roots and Prevalence of the Gender Pay Gap in America and the rest of the World

The systemic changes and outcomes that both women and men experience in the labor force have been a major issue for economists and women’s rights activists since the 1890s, when only 15% of women participated in the workforce in the United States. Also known as the gender pay gap, the average difference between the earnings of men and women, is one of the various aspects of the gender gap struggles that women endure everyday. While today 57.4% of women participate in the labor force, the issue of the gender pay gap is as much of a problem now as it was during the 1890s.

Currently, women in the United States are paid $0.823 for every dollar that their male counterparts make, a gap that is wider for Black and Hispanic women who earn 62.5% and 54.4% for every dollar that their male counterparts make.

 

In the United States between 2016 and 2017, the gap between the paid salaries of men and women grew wider by 0.1 percentage points; while overall, it has decreased 2 percentage points from 2008 to 2017. The following year, Jennifer Calfas, a Wall Street Journal reporter, conveyed how over the last ten years the wage gap has seen very little change, despite an increase in national and international awareness movements. Calfas illustrates how the United States is far behind Europe in closing the gender pay gap. Several Nordic countries have managed to diminish the gender pay gap by increasing transparency; specifically, Sweden, Norway, and Finland have enforced transparency on tax returns, and have made them accessible to the public upon request. Experts have stipulated that such new policies would not only lead employees to be happier, increasing their work productivity; but, would also give companies in the private and public sector the ability to close the gender pay gap. This practice, which has yet to be adopted within the United States, has not only helped bring awareness to the disproportionate pay gaps between men and women around the world, but it has also led employers to increase the pay that they give their female employees.

The development of tax transparency is not a new phenomenon for Nordic countries; the practice began in 1863 in Norway, as government officials would post the tax returns of individuals throughout town halls. The benefits of pay transparency extend past the needs of women, and could also improve the quality of employee work, and allow companies to control their business narratives. Since the introduction of pay transparency in Sweden, the country has seen a decrease in their gender pay gap. Similarly, Finland now has a gender pay gap similar to that of the UK ,where annually, women's earnings are equal to 82.3% of men's.

In recent years, there has been an increase in international support towards developing tax transparency policy. A prime example of expanded support for such policies is  the 2013 OECD Report for the G8 Summit discussion regarding the idea of a “change [within] tax transparency”. With the backing of the G8 Summit on pay transparency, more and more countries are becoming supportive of such measures, and it becomes increasingly likely that this initiative expands to other countries, including the United States.

However, as widespread implementation of tax transparency policies is yet to be seen, the gender wage gap continues to create challenges for women in the workforce that are reflected by two correlated phenomena. First, when more women enter a specific field, the wages of that field tend to decrease. More specifically, when more women became biologists, wages fell by 18%. Secondly, women are still heavily under-represented in executive roles. Women who serve as executives see their pay gaps narrow at a faster rate in comparison to women overall.

Impacts of COVID-19 on the Gender Pay Gap

Though women have seen much progress in the labor force, the gender pay gap has increased due to the spread of the COVID-19 pandemic. Despite the fact that women play a substantial role in maintaining household economic stability, many more women are staying at home than before the start of the pandemic. According to Jocelyn Frye, a Senior Fellow at the Center for American Progress, in 2020, women—specifically women of color-—played a huge role in preserving the economic and social stability of the home. In 2017 the RBC Wealth Management's Wealth Transfer Report’s study concluded that 98% of American women were either the sole or joint decision makers on the family's daily finances, and 84% were fully or partially responsible for the family investment portfolio. According to the Center for American Progress, in 2018, 67.5% of Black mothers and 41.4% of Latina mothers were the primary or sole breadwinners for their families, compared to 37.5% of white mothers. In 2015, Black women with children worked over 200 hours more per year than their white and/or Hispanic counterparts. The expectation that women need to play a major role in the households while also providing income creates a double-edged sword for many women for two reasons: on one hand the circumstances have forced many women to quit their jobs and stay home to take care of their families; and on the other hand, many women who were able to continue working lost their jobs, as women make up the largest proportion of American jobs lost due to the pandemic.

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US Federal Reserve Building in Washington D.C. pictured in 2008

Source: APK

Though the Census Bureau and the Federal Reserve concluded in August that women are three times more likely to stay at home for their kids, in December, American women held more jobs than their male counterparts. Yet in 2021, the Women’s Law Center concluded that of the 140,000 jobs lost in December 2020, 100% were those of women. Since the start of the pandemic, the women’s labor participation rate has decreased to 55.8% from a rate of 60%. According to a study conducted by the National Women’s Law Center in October 2020, over 865,000 female workers left the labor force in September, a number that was four times higher than that of male workers.

The economic crisis is affecting women more, as they are overrepresented in jobs that are directly impacted by the closure of businesses such as retail, manufacturing, food services, and domestic work. The concentration of women in industries particularly hurt by the pandemic economic crisis is even more severe in Latin America. In Central America 59% of women work in the retail, manufacturing, and food sectors; in South America 45% of women work in these industries. Similarly, throughout Latin America, domestic work accounts for up to 14.3% of women’s employment. Before the spread of the pandemic, women who were paid domestic workers in Latin America played a central role in caring for children, sick individuals, and keeping households running; however, as the pandemic continues to affect the lives of millions of individuals, it is estimated that 70.4% of domestic workers have been affected by quarantine measures due to unemployment, decrease in economic activity and pay hours, as well as lost wages. In turn, this has directly affected families throughout Latin America, as many were reliant on the wages of the matriarch in order to survive.

As the unemployment rate for women is increasing...the gender pay gap is widening alongside it.

What Does the Future of the Gender Pay Gap Look Like in a Post-COVID-19 World?

In 2019, TIME writer Katy Steinmetz explained that in order to see the end of the gender pay gap, individuals can no longer be ‘blissfully unaware’ of its existence; yet, in that same study, Steinmetz explains that 46.0% of American men believe that the gender pay gap was made in order to serve a political purpose and 25.0% believe it to be fake news. As the number of businesses closing due to the pandemic is increasing within the United States and schools have yet to fully open, the number of women who are losing their jobs is projected to increase. A United Nations Women and Women Count analysis further confirms this by depicting how the pandemic will disproportionately impact the global poverty level, affecting women the most. The United Nations Women and Women Count highlighted how in 2021, 118 women for every 100 men, were expected to live in extreme poverty; however, due to COVID-19, this gap is expected to increase by 2030 to 121 women for every 100 men.

As the future of the gender pay gap remains in question, the Biden-Harris administration seems to be enacting policies that will serve to prevent its further widening; such as providing mass vaccination, improving economic security, and expanding access to health care, and creating tax transparency. However, because the COVID-19 Pandemic has exacerbated the effects of the gender pay gap, there needs to be more direct policy that actively seeks to counteract such effects. The bottom line is tremendously clear: women deserve to be paid equally to men.

Acknowledgements:  ​A special thank you to Professor Nicole Bartels for her assistance and instructions in developing my piece. I would also like to thank Andrew Ma and Elad Raymond at the Onero Institute for giving not only me an opportunity to publish my work, but also to other undergraduate students.
About the Author:  Maria Alexandra D’agostino is originally from Caracas, Venezuela, but she now resides in Weston, Florida with her family. Maria is a rising fourth-year student at the George Washington University studying Political Science and Criminal Justice.

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