The State of Women in 2026: Progress, Pay Gaps and Participation

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0:19Alex Ossola:Hey, What's News listeners. It's Sunday, March 15th. I'm Alex Osala for The Wall Street Journal. This is What's News Sunday, the show where we tackle the big questions about the biggest stories in the news by reaching out to our colleagues across the newsroom to help explain what's happening in our world. On today's show, it may be Women's History Month, but today we're not just looking back. How are American women from the C-suite to childcare actually doing professionally and economically in 2026? There's little doubt that women have made great strides in the past few decades. Women are holding more managerial roles or top jobs at companies than in the past.

0:58Alex Ossola:They're also more likely to have a college degree. That's been the case for a few years now. According to McKinsey, women now control about a third of all retail financial assets in the U.S., and that's expected to rise to between 40 and 45 percent by 2030. But underneath all these data points, the reality for many individual women is a bit more complicated. The pay gap between men and women keeps getting wider, particularly so for Black and Hispanic women. Parents of young children are seeing the cost of child care skyrocket. A 2025 survey by Care.com found that families in the U.S. spent an average of 22 % of their household income on child care alone.

1:37Alex Ossola:A rollback of DEI policies means S &P 500 companies are appointing fewer women and people of color. To get a sense of what's driving these trends and how women are actually doing as a whole, I spoke with WSJ economics reporter Harriet Torrey and Matthew Nessler, senior economist at professional services firm KPMG.

2:02Alex Ossola:Let's go back for a second to the COVID-19 pandemic. I remember all these headlines at the time that women were leaving their jobs. Harriet, why did the pandemic hit women particularly hard? I think caregiving is really the answer to that question. During the pandemic, we saw everything shut down. Schools went to remote learning. And it was just a really tough time for so many families to juggle both of them. And just by default, a lot of women just didn't have the time or the bandwidth to try and stay in the labor force. A lot of women left the labor force and it took time for them to come back.

2:34I mean, there are definitely some benefits from the pandemic. We saw this very big adjustment to remote working. It became so much more normalized to have a remote job. And there are many women out there who have profited from that and who have found a better work-life balance from being able to work from home and to have that flexibility over their schedules. But certainly initially in the pandemic, when the economy shut down, it was really tough for families to balance caregiving duties and work.

3:01Alex Ossola:Matthew, women is a big group, of course. Have we seen the employment in certain groups affected more than others? So post-COVID, there's been a bit of a whiplash where there was that decline and then there was a sharp increase. And what my research is focused on is that over the past couple of years, some of that has started to decline again. And we saw both the higher highs and lower lows in particular among those with a college education who benefited disproportionately from the expansion of remote work, flexible work arrangements. And that is one of the main reasons now over the past couple of years there's been a sharper decline is as that has started to be pulled back a little bit.

3:45Alex Ossola:You both beat me to talking about where we are right now. The most recent data from the Bureau of Labor Statistics shows that the labor force participation rate for women in January of this year was 57.5 percent. That's down just a bit from the 58 percent before the pandemic in February 2020. You talked about hybrid schedules, the change to the return to office that's now having an impact. How about some of the industries in particular that are maybe driving this? Economists often talk about the difference between the overall participation rate, which to some degree is based on the aging population.

4:18We would expect that to decline somewhat. If you look at women in prime working age, so 25 to 54, January actually hit an all-time high in participation. But those aggregate figures can mask a lot of differences underneath the hood, and that's where we've seen some of those declines. We've seen them pop up in a lot of different industries. They're in healthcare, education, but in other industries, there have been some gains in information and manufacturing as well. Industries you might not necessarily think to the same degree for this specific group of prime-age women with young children.

4:56Alex Ossola:I know you recently came out with a report about these mothers of young children, how they've started returning to the workforce. What were some of the most interesting findings from that report? One of the interesting findings was that over the past couple of years, that particular group, moms with young children under five, there's been a decline in employment, but also of participation. And that is different from the past two cycles during COVID and during the financial crisis where employment fell for this group, but participation did not because unemployment rose. So a quick side definition, if over the past four weeks you have looked for a job, you are classified as unemployed and thus in the labor market.

5:40And so that has been one of the striking differences, how this has happened, A, outside of a formal recession, but that B, we've seen this decline in participation. Now, coming back forward all the way to today, over the past six months, we've seen a little bit of increase in participation. but a lot of that has been driven by active job search or an increase in unemployment. We're seeing people move a little bit between employment, maybe to out of the labor force, then they're looking for a job. Maybe they get a job. What we don't know is moving forward, given some of the structural constraints for this group, the degree to which they will be able to have employment and keep it, or whether we'll continue to see the shuffling in and out from employment out of the labor force into active job search and etc.

6:31Alex Ossola:Harriet, hopping over to you for a second, what are some of the factors that are still keeping women out of the workforce? Overall, the labor market is just not that great for everybody, men and women. It's just quite a difficult time if you're looking for a job. What we saw when we came out of the pandemic was that there were very acute worker shortages. So for a couple of years, the labor market was extremely hot. Wage growth was through the roof. If you wanted a job, it was really easy to find one, and you could probably get a nice hefty wage increase to go with it. But we have seen a sharp cooling since then.

7:02The labor market has come down from this high, and now people are reporting it's much harder to find a job. We've seen people perhaps spending longer trying to find a job, and it is just harder if you're on the sidelines to break back in. We are hearing this a

7:18Alex Ossola:Coming up, how women are doing matters for more than just women. It could show how the economy is doing overall. That's after the break.

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7:52Alex Ossola:Harriet, you mentioned pay, and that's, of course, something that comes up a lot in conversations around gender equality. You wrote a few months ago about how last year women working full-time made 81 cents on the dollar compared to men, which is the widest pay gap since 2016. What's driving that expansion? There are various theories for what might be going on. We did see in 2024 and also 2023 this widening in the gender pay gap. And of course, that was as the labor market started to cool. 2022 is really the very, very hot year. And then we saw a slight easing on that front. And what we think might be a factor is that companies started calling people back to the office.

8:29And as we said before, workers did win a lot of remote work flexibility during the pandemic. And many people, especially those of parents with young children or people who have other caregiving responsibilities, do find that not having to commute just add an enormous amount of very valuable time to your schedule. But as people were being called back into the office, many women that I spoke to for the story went through this and just said, I can't do this. It's too hard with my kids or with my caregiving responsibilities. Even people without kids just say it's too much and it's not worth it. So they were quitting and taking a different job.

9:02And often that came with a pay cut. But many workers decided it was worth it to be able to preserve that flexibility in their lives.

9:10Alex Ossola:I want to talk a little bit about the stakes. How much of an impact really does women's employment, women's pay have on the overall economy, on the overall labor market? This is all happening within the context of two major trends. One, the aging population that is increasingly retiring. And two, the shift to a more restrictive immigration policy, both of which is putting downward pressure on the number of workers of labor supply. And so within that context, moving forward, every employer is likely to face some challenges attracting and retaining workers. So this is a major issue, not only today, but moving forward in terms of employers being able to attract and retain that top talent.

9:52And I would also add, in addition to the child care side, there's also the other side of the care life cycle, which is elder care. And a lot of women in particular, especially Gen X and older, are providing unpaid elder care, which is another constraint on the ability to choose to work and how they work. And so I do view these as central workforce, business, and economic issues today and moving forward.

10:17Alex Ossola:If I were to meet you at a kid's birthday party, let's say, and I were to ask you, what is the state of the American woman, like the economic state, what would you say? It's a story of divergence. The high level, the aggregate participation rate among prime-age women, employment shares are at or near all-time highs. That is a success story to a certain degree. But that does mask a lot of differences among specific groups. And so if everyone is not doing well, that means that we still have a lot of work to do. And that's where this specific group is really struggling right now. Yeah, I would agree with that.

10:53American women are more educated than ever before. So in many ways, women are in a very strong position to succeed in their careers. But there are certain structural issues that are just difficult and hard to overcome and that women tend to just bear the burden of more profoundly things like childcare and elder care. So I think a lot of people are struggling to make it work. We have seen extremely high inflation over the past few years, which has really made it hard for families to pay for things like care services that they might need. It's not easy. And this is also an economy that doesn't have the levels of state support that perhaps other developed economies do.

11:31You know, many countries in Europe subsidize childcare to a high degree because they see it as important economic infrastructure. Certain states do more than others in the U.S., but it's definitely not the case that you have nationwide childcare infrastructure or anything like that. There are a lot of ways in which American women are poised to be extremely successful and achieve a great deal in the economy, but there are also some structural difficulties that make it hard to balance that with family life.

11:57Alex Ossola:Matthew Nessler, Harriet Torrey, thank you both so much for joining me. Thank you. Thanks so much. And that's it for What's New Sunday for March 15th. Today's show was produced by Pierre Bien-Aimé with supervising producer Melanie Roy. I'm Alex Osola, and we'll be back tomorrow morning with a brand new show. Until then, thanks for listening.

12:24Alex Ossola:This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. But what policy changes should investors be watching? Washington Wise is an original podcast from Charles Schwab that unpacks the stories making news in Washington right now and how they may affect your finances and portfolio. Listen at schwab.com slash Washington Wise.