by New Deal democrat   (Bonddad blog)

The decline in prime age labor participation: the smoking gun (Part 1of 2)

I recently wrote about the compelling evidence that the biggest reason for the decline in the prime working age labor participation rate was the increase in the number of second-earner spouses who decided to stay at home and raise their children, occasioned by the particularly significant decline in wages among lower quintile jobs, together with the soaring costs of outside day care.

Since that time (and I’d like to think in part because of my argument), the issue of the “child care cost crunch” has become much more visible, with the candidates in the recent Democratic Presidential debate weighing in, in support of more assistance for working mothers.
For example, Fortune magazine repored that:

the Economic Policy Institute (EPI), a worker advocacy group, finds that caretaking costs have become so exorbitant that in most parts of the U.S., families spend more on childcare than they do on rent (included in that number: babysitting, nannies, and out-of-home day care centers.
I think [the cost of childcare] plays a role in a woman’s decision to go to work,” says Gould. “It is taking a toll on labor force participation and therefore on the economy.”
Measuring child care costs against a variety of benchmarks—including the cost of college tuition, the HHS’s 10 percent affordability threshold, and median family incomes—demonstrates that high quality child care is out of reach for working families.

And the Pew Research Foundations updated its study of the impact of child care on the careers of mothers in the labor force:

[W]hile 42% of mothers with some work experience reported in 2013 that they had reduced their work hours in order to care for a child or other family member at some point in their career, only 28% of fathers said the same. Similarly, 39% of mothers said they had taken a significant amount of time off from work in order to care for a family member (compared with 24% of men). And mothers were about three times as likely as men to report that at some point they quit a job so that they could care for a family member (27% of women vs. 10% of men).
It’s important to note that when we asked people whether they regretted taking these steps, the resounding answer was “No.”