Fact Sheet: The State of Women in the Labor Market in 2023

Work is essential to women’s economic security, social equality, and a robust and sustainable economy for all. Three-quarters¹ of so-called prime-age women²—those ages 25–54—hold down a job today, compared with slightly more than two-thirds a decade ago. Women are also working longer hours: Today, 84 percent of employed, prime-age women work full time.³ These gains come despite the coronavirus pandemic’s disproportionate impacts on women’s employment. ⁴

This fact sheet examines the current state of women in the labor market and finds that women have made impressive employment gains, driven by the strong economic recovery. At the same time, long-standing structural inequalities and uneven burdens interfere with women’s full and equal participation in the economy.

1.  Women’s employment has seen broad improvement thanks to a strong post-pandemic recovery

Thanks to the series of targeted fiscal responses by policymakers, including the American Rescue Plan, the U.S. economy recovered in record time from the COVID-19 recession, with overall employment fully recovering to pre-pandemic levels by August 2022.⁵ Women’s employment has also now recovered to pre-pandemic levels, and other measures show similar improvement. As of January 2023:

• Women’s overall employment has reached 99.9 percent,⁶ and prime-age women’s employment stands at 100.0 percent⁷ of their February 2020 levels.
• The labor force participation rate for prime-age women hit 77.0 percent, exceeding the level in 2019 (76.0 percent) and setting a new high for the share of women either working or looking for work.⁸
• The employment-to-population ratio for prime-age women hit 74.7, surging past the rate of 73.7 percent in 2019—the previous high-water mark for the share of the prime-age female population that was employed.⁹

Women with minor children—those younger than age 18—at home saw particular improvement in employment over the course of 2022, thanks to widespread reopening of schools, expanded child care stabilization funding,¹⁰ availability of vaccines for young children, and plentiful job opportunities:

• 993,000 more mothers were working in December 2022 than one year prior.¹¹
• Mothers of children younger than age 5 have seen employment levels recover more slowly than mothers of school-age children, but even for this group, employment stands at 99.2 percent of the pre-pandemic level.¹²
• The share of mothers who are working has increased across the board. Regardless of the age of their youngest child, employment-to-population ratios were higher at the end of 2022 than they were in 2019, before the pandemic hit.¹³

Despite this progress, having minor children at home still disproportionately depresses women’s employment prospects. The effect is largest for those with the youngest children—and this was the case before the COVID-19 recession. Additionally, huge gender gaps in employment rates between mothers and fathers persist.

2.  Despite recent progress, women are still paid less than men, and the pay gap worsens with age

Women continue to experience lower earnings as compared with their male counterparts, despite steadily growing participation in the labor force. Men outearn women within every age group. Even restricting the comparison only to full-time workers reveals that women’s earnings lag far behind those of men:

• Among younger workers, ages 16–24, women’s median usual weekly earnings are about 8 percent lower than men’s.¹⁴
• The gap is even larger for prime-age workers, with women earning 16 percent less than men.¹⁵
• The pay gap is larger still among those aged 55–64, with women earning 22 percent less than men at the median.¹⁶
• Women aged 65 and older earn 27 percent less than men of the same age.¹⁷

Earnings gaps are even larger for many women of color due to intersecting, systemic racial bias in the workplace.¹⁸ For example, median usual weekly earnings in 2022 were $835 for Black women working full time and $761 for Hispanic women, compared with $1,172 for white men.¹⁹

The plateauing of women’s earnings relatively early in their careers has serious ramifications for economic security over the life course. Men whose earnings grow decade after decade are better positioned to save for retirement, build home equity by paying down mortgage debt, and engage in other forms of savings. Earnings gaps represent a prime reason why women, especially widows and divorced women or those who never married, experience higher rates of poverty in old age than men.²⁰ 

3.  Occupational segregation has contributed to a slower recovery for some women

Occupational segregation—the clustering of women in just a few occupations—is a key reason for gender wage gaps,²¹ helped cause the pandemic’s disproportionate hit to women’s employment,²² and remains an obstacle to their recovery, especially for women without college degrees. Before the pandemic, nearly 6 in 10 women were employed in just three sectors that also were those hardest hit by the pandemic: education and health; leisure and hospitality; and retail and wholesale trade.²³

Employment recovery in these sectors has been uneven, especially for women:

• Women’s total nonfarm employment has recovered at a somewhat slower pace compared with overall employment, at +1.4 percent versus +1.8 percent since December 2020.
• In the industries where women have historically worked in large numbers, they are also not participating in the recovery to the same degree. This is especially true in the retail sector, where women’s employment remains down 156,400 jobs (-2.0 percent), even as overall employment in retail has nearly recovered to its pre-pandemic level from February 2020. Similarly, in leisure and hospitality, women’s employment is down by some 300,000 jobs (-3.3 percent).²⁴

The lagging recovery of women’s employment in hospitality and retail manifests as a significant disparity in employment recovery along educational attainment lines:

• Employment among women without college degrees, who tend to experience greater occupational segregation,²⁵ remains mired at 4.4 percent below its pre-pandemic level—or 1.6 million fewer such women working in January 2023 than in February 2020.²⁶
• Meanwhile, employment of women with a four-year college degree was up 2.7 percent over the same period, a gain of 818,000 jobs.²⁷

4.  Caregiving disparities continue to undermine women’s employment

Women bear a disproportionate burden from family caregiving responsibilities, not only during their reproductive years, but across the life course. Wide swaths of the workforce lack paid leave and other important protections²⁸ that support labor force engagement,²⁹ leading many women to either reduce their work hours or drop out of the labor force entirely.

A massive gender gap exists in the share of women and men who are either not working or working part time because of child care or family reasons. Regardless of age or parental status, women were a staggering five to eight times more likely to experience a caregiving impact on their employment in 2022.³⁰

Time out of the labor force and reduced working hours have lifelong ramifications for women’s economic security—from lost earnings today to smaller Social Security benefits and retirement savings down the road. Women’s reduced labor supply also has growth, productivity, and international competitiveness ramifications for the whole economy.³¹

Conclusion

Women’s employment has undoubtedly benefited from the strong economic recovery, but there is still work to do. Sustaining the economic recovery will require policymakers to think broadly and inclusively when it comes to supporting women’s employment. This fact sheet reveals the need for continued attention to policies that support women’s labor market participation and address the barriers that hold women back from obtaining employment, fair compensation, opportunities for advancement, and equitable treatment at work. The need for action on policy proposals that would advance these objectives³² remains urgent—an inclusive, broad-based recovery requires that we leave no woman behind.