Families at risk in recession

WASHINGTON (MarketWatch) -- Women have become increasingly vulnerable to job losses during downturns, putting families at greater financial risk during these troubled times, according to a Tuesday report from the Democratic staff of Congress's Joint Economic Committee.

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A new government report says women are more vulnerable in a recession. We turned to the experts at Spherion to talk tips on retaining a job and getting a job in a tough economic environment. Stacey Delo reports. (July 23)

"It now appears that, unlike in decades past, families can no longer rely on women's employment to help boost family income during a downturn," according to the report. "Families are more economically vulnerable as wives are no longer insulating families from economic hardship in times of higher unemployment and falling or stagnant real wages."

A family relies on the typical wife for more than one-third of its income, according to the report, which added that one-quarter of children are raised in single-mother families that are at particular risk. On Wednesday, the Joint Economic Committee is holding a hearing about the impact of higher household costs and stagnant wages.

Women have yet to regain their foothold in the labor force since the 2001 recession. At the business cycle's peak in March 2001, the employment-population ratio for women 20 years and older, seasonally adjusted, reached 58.8% -- a rate that hasn't been reached since and hit 58.2% in June, according to the Department of Labor.

"The remarkable fact is that this is going to be the first recession from one peak to the next that we've seen a decrease," said John Schmitt, is a senior economist with the Center for Economic and Policy Research. "We never got back to where we were."

The report noted that women's larger job losses in the 2001 recession could be due to their entry into a wider array of professions.

"Because of this, women may be more susceptible to the impact of the business cycle than they were when they were more highly concentrated in a smaller number of noncyclical occupations, like teaching and nursing," the report said.

The Democratic staff said there could be a "larger role" for fiscal policy than in prior slowdowns with moves such as: providing grants to states for revenue that may be lost in a downturn and loosening application standards for unemployment insurance benefits.

The report also found:

• In the 2001 recession, women lost a larger share of jobs compared with men in manufacturing and trade, transportation and utilities. In the other high-job-loss industries, women lost about the same share of jobs as men.
• The female employment rate as of 2008 is about six percentage points below where it would have been had employment stayed on its trend line from 1948-2000.
• Families with a working wife have seen real increases in family income over the past three decades. Adjusting for inflation, families with a nonworking wife have income today that is about the same as it was in 1973.

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