Recession's Permanent Change: Breadwinning Wives
A new analysis of women’s earnings over the last three recessions shows that recessions don’t just cause women to earn a greater share of household finances in crunch times. They seem to permanently alter the balance of family paychecks.
“This past recession caused women’s share of earnings to rise even more significantly, with the largest single year increase,” Kristin Smith, a family demographer at the Carsey Institute and a research assistant professor of sociology at the University of New Hampshire, tells Marketing Daily. But even after recessions end and men are less buffeted by unemployment, “there doesn’t seem to be a return to previous levels.”
Her analysis, based on the latest earnings data from the U.S. Census Bureau, finds that in 2007, before the Great Recession, employed wives contributed 44% of total family earnings. From 2008 to 2009, it rose two percentage points, the largest single-year gain in a 23-year period. The following year, it climbed to 47%, where it stayed in 2010 and 2011. From 1988 to 2011, a window she selected to include three past recessions, that share rose 9 percentage points. Husbands’ portion of earnings in that period fell from 62% to 53%.
The trend is strongest among couples where the husband has a lower level of education. Women married to men with a high school degree or less contributed 51% of total family earnings in 2011; those married to men with a college degree contributed 42%.
While her research looked strictly at earnings, and didn't address women’s fears and concerns about finances, she points out this most recent recession was especially bruising. “It was so broad and hard-hitting, it wouldn’t surprise me if concerns about future unemployment are motivating women to remain in the work place at these levels.”
From December 2007 to January 2010, America lost 8.7 million jobs, with male-dominated industries, such as construction and manufacturing, suffering the most. Unemployment peaked in October 2009, at 10%, with men’s unemployment at 11.2% and women’s at 8.7%.
“If history is a good guide,” her report concludes, “it is likely that wives’ share of total family earnings will not return to pre-recession levels, but rather, the Great Recession will serve to propel wives’ contributions higher. It is likely that wives will remain in the labor force even after their husbands return to work, as many families have lost ground due to diminished savings, housing values, and retirement accounts.”