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The Economy Can't Recover as Long as Day Cares and Schools Remain Closed

Lack of childcare could cause a severe dip in the American workforce, with women bearing the brunt of the struggle.

You're reading Entrepreneur United States, an international franchise of Entrepreneur Media. This story originally appeared on Business Insider

The Trump administration finally weighed in on something American families have known for months: There will be no economic recovery without proper childcare.

damircudic/Getty Images via BI

Trump threatened to cut off school funding on July 8 in an effort to pressure mass reopenings in the fall — something he can't necessarily do. The same day, New York City Mayor Bill de Blasio announced that the country's largest school district will only partially reopen in the fall. The plan would have 1.1 million students mostly learning remotely while attending low-density classes up to three days a week come September.

In a news briefing, New York Gov. Andrew Cuomo slammed Trump's threat: "School reopenings are a state decision," he said. "The president does not have any authority to open schools." Cuomo did not sign off on de Blasio's proposal either. "We will open the schools if it is safe to open the schools," he continued.

Trump's desire to open all schools fully, while unlikely to temper the surge in coronavirus cases across the U.S., does underscore the absence of childcare's potential to further upend the American economy. "You can't really reopen the economy fully if you have the schools closed," Cuomo also said in his briefing.

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The combination of closed schools and struggling childcare centers could have adverse effects on the economy

An April survey from the Bipartisan Policy Center found that 60 percent of licensed childcare providers shuttered amid the coronavirus outbreak. As Business Insider's Marguerite Ward previously reported, one in three daycare providers could permanently close following the pandemic. 

Limited childcare options could further devastate the country, which is already seeing a worse economic downturn than the Great RecessionA German study cited by the Washington Post estimated a lack of robust childcare programs would result in an 8.4 percent reduction in total working hours across Europe.

A similarly daunting loss could happen in the U.S. The University of Chicago estimated that roughly 17.5 million workers, or 11 percent of the U.S. workforce, will be unlikely to work full-time until schools and day cares fully reopen.

Lack of childcare will disproportionately impact women

More than half of American women are mothers, and more than half of those mothers are part of the American workforce. As the coronavirus outbreak and lockdowns wear on, women continue to shoulder the majority of the burden at home. Even in two-parent households, mothers provide 70 percent of childcare during working hours, a Northwestern University study found.

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Women, labor economists said, are at high risk of dropping out of the labor force altogether to raise children without proper childcare options. At some point, there's a struggle to both a parent and a worker.

The women who commit to juggling both could see their earnings potential and work opportunities dwindle as a result, according to the New York Times. "We could have an entire generation of women who are hurt," Betsey Stevenson, an economics professor at the University of Michigan, told the Times.

Some women "may spend a significant amount of time out of the work force," Stevenson said, implying a difficult return, "or their careers could just peter out in terms of promotions."