Why the number of self-employed women has soared in the US: report

02 September 2022

When liberal economist and New York Times columnist Paul Krugman argues that the U.S. economy has performed well under President Joe Biden, he isn’t trying to pretend that inflation isn’t a problem. But Krugman is definitely focusing on unemployment figures. On August 19, the U.S. Bureau of Labor Statistics (BLS) reported that the United States’ “national unemployment rate” had “edged down to 3.5 percent” — which was “1.9 percentage points lower than in July 2021.”

The U.S. has an inflation problem, as do many other countries. But as of September 2, the U.S. doesn’t have a problem with high unemployment. According to the BLS, the U.S. has, in 2022, experienced its lowest unemployment rates in over half a century.

Another U.S. economic trend of 2022 is the number of women who are now self-employed. According to a report that the Center for Economic and Policy Research (CEPR) released in late August, more women are self-employed in the U.S. in 2022 than before the pandemic — and Axios’ Emily Peck, discussing the report, notes that this is especially true of African-American and Hispanic women.

“The likely explanation here is not simply an explosion of entrepreneurship, but also, a reaction to the childcare worker shortage,” Peck writes in an article published on September 2. “Mothers are scrambling to care for children at home and still earn money…. Those with less education have a harder time finding jobs that allow for remote work.”

Peck notes that “overall, in the first half of 2022, self-employment levels” were “up .4 percentage points — about 600,000 people — as compared to the period before the pandemic that the authors” of the CEPR report “examined.”

“Drilling down, the share of employed women who report being self-employed rose by .7 percentage points to 8.2 percent,” Peck explains. “That's slightly more than twice the increase men reported. Black women saw even bigger gains. The share of Black women who said they were self-employed in 2022 rose more than 1 percentage point, from 4.1% pre-pandemic to 5.2%. Hispanic women saw a similar increase. For White women, the number ticked up by .6 percentage points.”

One of the takeaways from the CEPR report, according to Peck, is that “there aren't enough people working in the childcare sector to meet demand.” Peck cites another report in her article: one released by the Center for American Progress (CAP) on September 2. And according CAP, child care centers are serving fewer families because they are understaffed; as a result, more working mothers have been turning to remote work and working from home.

According to Elliot Haspel, author of the book "Crawling Behind: America's Childcare Crisis and How to Fix It," the childcare industry is struggling badly in the U.S.

Haspel told Axios, “The child care industry was sick before the pandemic; now, it's dying. It's a failed market, it's in a death spiral.”

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