The reason the U.S. economy isn’t working is because society expects women and people of color to carry out essential functions for meager compensation.
As candidates up and down the ballot campaign on how they will tackle inflation, a critical aspect of the problem remains conveniently overlooked: The women whose work our economy relies upon, yet devalues, feel cost-of-living increases the most—a dynamic pushing more women, particularly women of color, to the brink of poverty.
This is no coincidence; it is structural discrimination. Our failure to address this reality not only hurts women and their families, but also undermines our potential for economic growth.
Across the U.S., women as a whole are 68 percent more likely to live in poverty than white men. That rate is even higher in 21 states and our nation’s capital, where women are 208 percent more likely to live in poverty.
Women of color endure even starker disparities. Latinas typically face the highest poverty rates, earning anywhere from 42 to 63 cents for every dollar earned by white men, depending on the state. And although all women are worse off irrespective of region, figures are often most severe in the South. Mississippi leads the country with the highest poverty rate for women and essentially no wage protections for workers.
These figures should be startling, but they come as no surprise in an economy where women are still assigned the bulk of all caregiving responsibilities and are overrepresented in the minimum wage and tipped wage workforces. In Texas, with one of the highest overall poverty rates, women are nearly twice as likely as white men to work a minimum wage job.
Our economy assigns little to no value to care work, but would collapse entirely if women stopped doing this work.
Minimum wage work includes essential jobs, such as care work for children and the elderly—tasked as “women’s work”—where wages are outlandishly low. And, of course, this labor enables others to work jobs that earn much higher salaries, while leaving care workers unable to cover basic necessities. In the 20 states from Alabama to Wyoming that have a minimum wage at or below the federal rate, workers can be paid as little as $7.25 an hour, or approximately $15,000 annually, for full-time work.
Workers who rely on tips, like restaurant servers (also predominantly women), face an even worse fate, making as little as $2.13 an hour. Women in these industries are expected to make the rest of their income through tips and typically endure high rates of sexual harassment and abuse as a result.
These wages are especially damaging for women with children, as demonstrated in Louisiana where half of single mothers live in poverty. Even in states that enact commendable minimum wage increases and adjust annually for inflation, wages are not keeping pace with the rising cost of living. Women of color continue to overrepresent those making the least, resulting in an economy that relegates a disproportionate number of women to working poverty.
These inequities are not the inevitable result of natural market forces, but are driven by an economic model that expects women and people of color to carry out essential functions for meager compensation. Our economy assigns little to no value to care work, but would collapse entirely if women stopped doing this work.
Not only is this model discriminatory, it also undermines economic growth. Women’s labor and spending powers our economy. In fact, 70 percent of women—and 78 percent of Black women—are essential earners for their households, contributing at least 30 percent of household income. When we devalue work carried out by women, we inhibit their potential to reinvest and grow our economy, while undercutting economic mobility for their children and families. This drives generational cycles of financial insecurity that prevents equitable and uniform economic growth.
We will continue to stifle this economic potential until we correct these disparities. And we can. But not until we confront their discriminatory underpinnings.
As a start, we must recognize that care work comes at a high price we all must bear. This requires investing in sustainable care infrastructure, including universal childcare, that reflects the critical value of this work and the severe economic toll it takes on women and families. The cost of building a more equitable system will be repaid (and more!) by the investments women will, in turn, be empowered to make back into the economy.
Next, we need to address the segregation of women and people of color in lower-wage work. This requires increasing the minimum wage until it reflects the cost of living, eliminating the lower tipped wage, and rethinking how we value work in female dominated industries to lift women of color up from the bottom of the wage chain.
Lastly, it is not a coincidence that historic carveouts of certain workers—like domestic workers, farmworkers and tipped workers—from our laws have kept wages artificially low in industries dominated by women and people of color. These carveouts have a widespread discriminatory impact and create opportunities for exploitation. All workers deserve equal protection under our law and should be covered regardless of industry, employer size, immigration status or hours worked.
To meaningfully address our cost-of-living crisis, we must reform the structures within. Ultimately, we need to reject the notion that our economy can only thrive under a discriminatory model that exploits and devalues the labor of women and people of color. Not only is this model abhorrent, it hinders the true potential of our economy and those who sustain it.
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