More Women Returning to Work in 2021

May 5, 2021

Women returning to the workforce has been a major headline ever since March 2021 produced large job gains. Though women have not regained all jobs lost during the pandemic, there are now relatively the same number of women out of the labor force as men.

More women have begun to rejoin the labor force in 2021.

From January to March 2021, 629,000 women joined the labor force, meaning they either started a job or began looking for one. Prior to the start of the rebound, a net 2.5 million women had left the labor force between February 2020 and January 2021, well above the 1.8 million total for men. As of March 2021, the totals stood at approximately 2.0 million men and 1.9 million women out of the labor force, which are still startling statistics. Relatively, the number of women and men in the labor force is at roughly -2.0%.

What Has Changed?

Many of the conditions that led to so many women exiting the labor force are improving. Limited childcare options during working hours affected women across occupations and socioeconomic levels. This was especially visible during summer 2020 and the second wave of lockdowns that occurred during the end of 2020 and through January 2021.

For women who were single parents or did not have jobs that allowed them to work from home, the closure of in-person schooling and summer childcare programs affected their ability to work. From July to September 2020, the number of women dropping out of the workforce grew substantially. In fact, it became higher than it was during the first three months of the pandemic.

In recent months, the increasing rate of vaccinations and lifting of COVID-19 restrictions have spurred the U.S. economy back to life. As businesses ramp up productivity, they need more workers. With more schools and childcare facilities opening, more women have returned to work. Even though unemployed, the growing number of women looking for employment indicates that the overall job market is improving.


Female-Dominated Industries Make a Comeback

Another factor limiting women’s ability to work has been the industries most impacted by the pandemic, which are also dominated by female workers. In hard-hit industries like Retail Trade, Education and Health Services, and Leisure and Hospitality, there has been little opportunity to return to the workforce.

Industries with a large female employment base, in which women make up more than 60% of workers, include:

  • Retail Trade: Department stores, clothing and shoe stores
  • Educational Services: Elementary and secondary schools
  • Health Services:
    - Doctors’ offices
    - Child daycare services (95% of workers are women)
  • Personal Services: Beauty salons

As these industries bounce back, the expectation is that women will return in large numbers to fill open positions.

Related: Unequal Impact: Why Gender Matters in the Workplace

As with many things impacted by the ongoing pandemic, uncertainty remains. Virus counts must sustain low levels, and vaccination rates high, for more female-dominated industries to fully rebound. Childcare will have to be consistently available for many female workers to remain in the labor force.

With stimulus payments and unemployment insurance benefits offering the same or more as previous employment wages, would-be employees are not eagerly accepting available jobs. For single mothers or married women who do not earn much and lack childcare options, the practical (and economical) decision may be to remain out of the workforce.

Adaptable Hiring Strategies

Talent acquisition professionals will need to work with leadership teams and hiring managers to get creative, and more importantly, competitive on compensation and benefits to attract and keep talent. This may include:

  • Signing bonuses
  • Higher wages
  • Part-time or flexible employment
  • Remote work or hybrid options
  • Non-traditional perks and benefits
  • Continued education or tuition reimbursement

ThinkWhy’s talent intelligence software, LaborIQ®, forecasts talent demand to remain high throughout 2021. Organizations that can quickly adapt to employee expectations and candidate compensation demands will fare better with hiring and employee retention.

LaborIQ by ThinkWhy reports, forecasts and advises on employment conditions and the impact to jobs, industries and businesses across all U.S. cities.