Economics of Motherhood: The Hidden Costs of the Most Important Job
Motherhood has been used to oppress and exploit women for centuries. But it doesn't have to be this way. And as mothers, we're ready for a revolution. We love our kids, but we struggle with losing our identities, bearing the weight of motherhood without enough support, and striving to meet those impossible standards of what it means to be a good mother. It's time to openly discuss how motherhood is deeply affected by patriarchy, racism, and capitalism, so that we can break free of these systems.
Susie:As mothers, we know our work is valuable and has radical potential to birth a more equitable and inclusive future for ourselves and our children. Welcome to the Rebel Mothers podcast. I'm your host, Susie Fishleader. And together, we'll explore the challenges of modern motherhood and reclaim mothering as an act of liberation. Hello, everybody.
Susie:Welcome back to another episode of Rebel Mothers. Today, we're gonna walk through the economics of motherhood. Now, I know what you might be thinking. Economics? But trust me, this is a topic that touches the core of every mother's experience, and I don't think we're talking about it enough.
Susie:I recently read an article called how the world's falling birth rate is leading to economic catastrophe. And the article warns of dire consequences if people don't start having more babies, like the end of innovation, the end of public service, you know, an an increase in taxes, cutting retirement and health benefits for older adults, may even raising the retirement age so we have to keep working until we die. Right? But there was almost no mention of the other side of this equation. What is the cost, the individual cost, of becoming a mother?
Susie:If the falling birth rate is leading to economic catastrophe, maybe we should looking at the economic realities of what it means to be a mother. And motherhood carries with it a really significant economic dimension that often goes unnoticed or at least often goes undiscussed. From the moment that we bring new life into the world, we are met with financial decisions and burdens that can shape our lives and those of our children. But there's a significant lack of conversation around the economics of motherhood because we're still operating under this patriarchal belief that of course, women have a biological instincts to have as many children as possible because motherhood is their highest calling and potential in the world. No one wants to sully the pure vision of maternal love by talking about money or economics.
Susie:People don't wanna talk about the reality of motherhood as being a financial burden. But I do. And as often happens when I start diving into a topic that interests me, there's so much here to cover that I've actually divided this up into 2 episodes. So today, we're gonna look at what I call the cost of motherhood. We're gonna explore everything from the impact of maternity leave or the lack thereof to the expenses of childcare, the societal expectations of consumerism, and much more.
Susie:I did a lot of research to come up with some current and relevant numbers here about the cost of motherhood, but I don't just want to, like, data dump on you. So what I've done to try and make this all relevant is to invent a fictional young mother in America. We're gonna call her Emily, and we'll follow her story, paying particular attention to her economic challenges and choices in motherhood. In next week's episode, we're gonna take a look at motherhood. We're we're we're sort of zoom out, and we'll kinda look at motherhood through the lens of different economic systems, you know, capitalism, socialism, and introduce some maybe thought provoking alternatives that don't often make it into mainstream discussions like an economy of caring or the gift economy.
Susie:Now disclosure. Please remember, I am not an economist. I am a maternal activist and scholar and my field of expertise is motherhood studies. So everything I talk about this week and next is gonna be pretty high level, basic economic definitions. Please don't come at me if I say something wrong.
Susie:Just let's just start to have this conversation. Okay? Alright. So let's go ahead and get started with Emily's story. So Emily was born in the US in 1990, a time when hopes were high for a prosperous future.
Susie:She grew up pretty solidly middle class with a mother who was a nurse and a father who was an engineer. She always loved decorating and had dreams of becoming an interior designer. And at the age of 13, she got her first job babysitting for neighbors neighbors earning her own money, which she began saving early on. Throughout high school, Emily continued babysitting and took on odd jobs to save her college. She was accepted to a local public university so she could take advantage of in state tuition.
Susie:But in the fall of 2,000 8, just 1 month after starting her 1st year of college pursuing a bachelor's degree in interior design, the financial crisis hit and her father lost her job. Suddenly, the money that her parents had set aside for Emily's college was needed to keep them afloat while he looked for a new job. So while her part time jobs helped her cover some of the tuition costs, she still had to take out student loans to finance her education. She graduated in 2012 with about $25,000 in student loan debt. Emily found a job as a designer at a local architecture firm, working long hours to gain experience in her field while also paying rent for an apartment she shared with 2 friends and chipping away at her student loans.
Susie:It was a balancing act, but she was determined to make her dreams come true. In 2015, Emily married her college sweetheart, Matthew, and they started planning their life together. They looked forward to the day when they could become parents, but they knew the financial implications. So they dutifully saved money as much as they could, continuing to pay off student loan debts, while also renting a small house near Emily's parents. In 2018, they gleefully discovered that Emily was pregnant.
Susie:And here is where her motherhood journey begins. Although Emily's company, a small firm that employed 25 people, offered health insurance, Matthew's company package offered better coverage. So Emily was able to go to all of her OBGYN appointments through his insurance plan. That fall, their first child, Lily, arrived. After insurance paid their portion, the hospital visit cost about $4,000 out of pocket, which they took out of savings.
Susie:Throughout the pregnancy, Emily and Matthew had had several conversations about when Emily would return to work. Of course, if they lived in nearly any other country in the world, there would be some guaranteed minimum of paid time off. Globally, the average paid maternity leave is 29 weeks over 7 months, and the average paid paternity leave is 16 weeks. But the United States is the only developed country in the world that offers 0 paid maternity leave. Instead, the US government offers FMLA, the Family Medical Leave Act, which provides certain employees with up to 12 weeks of unpaid, jaw protected leave per year.
Susie:Basically, it means you can, under FMLA, take up to 12 weeks off unpaid, and your company can't fire you. That's the protection. Okay? However, there's certain criteria that your company has to meet. And because Emily's company only employed 25 people, so they did not meet the minimum criteria of 50 employees, Emily was unable to participate in FMLA.
Susie:Luckily, because she's been a valued employee for 6 years, her firm offered her 6 weeks of paid leave above her 2 weeks vacation pay. Emily negotiated another 4 weeks of unpaid leave so she could stay home with Lily for 3 months, relying on Matthew's income during this period. Matthew's company did not offer any kind of paid leave and they couldn't afford for him to take unpaid leave. So he took a few days vacation after came home from the hospital, but then had to go back to work. During her maternity leave, Emily enjoyed a string of friends and family visiting and bringing dinners for the 1st month that she and Lily were home.
Susie:But then as the visits tapered off, Emily found herself home alone with a newborn for days at a time. Contrast this to new mothers in Germany who receive daily visits from a midwife at home for the 1st 10 days and then every 2 or 3 days for 8 weeks. The midwife ensures that mothers are recovering well and also helps with breastfeeding and infant care. And this is all covered by insurance. It was a challenging time for the young couple to afford everything that new babies need.
Susie:They were given lots of cute baby clothes and diapers at Emily's baby shower but still had to purchase a car seat, a stroller, a crib, a dresser, and so on. If Emily had lived in Finland, she would've been given a Finnish baby box, a box granted by the Finnish government to all expecting or adoptive parents. The package contains children's clothes and other necessary items like diapers, outdoor gear, bathing products, bedding, cloth, and towels. Emily also struggled to breastfeed so they switched to formula. Plus there was then the cost of bottles, nipples, highchair, and so on.
Susie:Add in the cost of more diapers, wipes, baby shampoo, toys, and so many things. The cost of all of the stuff that they bought in that 1st year added up to nearly $20,000 which Emily figured out one morning during the 3 AM feeding. After 3 months, Emily returned to work part time and Lily was cared for by an in home nanny, a college student who charged about $400 a week for 25 hours of care. Side note for the nanny, this is about $16 an hour, which is above the national minimum wage of $7.25 cents an hour, a number that has not increased since 2009. But even $16 an hour is barely a living wage in many states.
Susie:We'll talk about the global care chain in next week's episode. Emily loved her job as a designer and relished the hours she was able to spend engaging in meaningful work and adult friendships. But she was acutely aware that with her part time wages, after taxes, she only brought home about $650 a week which meant that paying for a nanny was more than half of her income. However, she knew it was important to her sense of identity, as well as her social security and retirement savings that she continue to work. Incidentally, in Germany, parents receive Kindergeld, a universal child benefit every parent in Germany is entitled to, regardless of their financial situation or income.
Susie:It's in place to guarantee that every child's basic needs are covered. Families receive €250 Kindergelt per child per month. And in Germany, parents are eligible for parental allowance, Elterngeld, which is a benefit provided by the German government to new parents. This allowance also supports the cost of bringing up a child. New parents receive between €318100 a month as parental allowance for up to 1 year after the child is born regardless of employment status.
Susie:By the way, Emily is still paying off her student loan to $200 a month. Okay. 1 year after Lily was born, their landlord told them he was selling their rental home and they had 2 months to move out. Despite initially panicking, Emily and Matthew, with the help of both sets of grandparents, were able to buy their first home in 2019. A fixer upper in a cute neighborhood within walking distance of an elementary school.
Susie:They were astonished at their good luck and delighted that they would no longer be at the mercy of a landlord. Emily returned to work full time and her mother retired and stepped in to care for Lily when the nanny wasn't available. So Emily's net income increased. Matthew also recently got a 6% raise. Interestingly, a 2014 study confirmed this so called fatherhood bonus which showed that men with children earn on average 6% more than men without children.
Susie:The young couple felt like financially, things were finally going their way. They were able to pay off significant portions of their student loan debt and they started planning for their next child while remodeling their little home. Emily was thrilled to discover that she was pregnant by the end of 2019. Then, in 2020, the world was hit the COVID 19 pandemic. Emily's fears for her family's safety grew and with the arrival of her second child, a son named Ethan, she made the difficult decision to step away from her career entirely.
Susie:She knew that the cost of childcare for 2 children, coupled with the uncertainties of the pandemic, made working outside the home seem it just didn't make sense. Emily tried to take advantage of the temporary unemployment assistance programs offered by the CARES Act, but she was determined to be ineligible since she had left her job willingly. With Emily at home, they knew they would save about 20,000 dollars a year on childcare for their 2 year old and newborn. However, there were still plenty of other bills to pay. Ethan's birth was complicated and Emily needed a cesarean delivery.
Susie:With changes in Matthew's insurance plan, the hospital bill was nearly $8,000 out of pocket and they had to put some of that on a credit card. They still had a lot of baby stuff from Lily, but now needed to buy a new toddler bed, a second car seat, a double stroller and more. They spent nearly 15 dollars 1,000 on all the stuff required to bring another child home and a lot of that also went on the credit card, which then took over a year to pay off on a single income. Let's fast forward to today, March of 2024. Emily and Matthew have a 6 year old and a 4 year old.
Susie:Lily started kindergarten last fall and Ethan is now in preschool 4 mornings a week. Today, Emily sits at her kitchen counter which is covered in breakfast crumbs and crayons and drinks her coffee. After 4 years of being a stay at home mom, these quiet mornings feel strange to her and this morning she is thinking about money. Emily grabs a pad of paper and decides to write down some general financial figures for the last 6 years since becoming a mom. Emily has missed 4 years of her career plus 2 years only working part time which adds up to about $300,000 in lost income.
Susie:Additionally, she's missed out on contributing around $18,000 to her Social Security retirement fund. Lily goes to a public school, so her education is now free, but they still have one more year of paying for preschool for Ethan, which will cost another 8,000. Over the last 6 years, they have spent about $100,000 on their 2 children, which covers food, clothing, diapers, activities, toys and books, health care and doctor visits, a lot their larger house and car, plus the occasional babysitter. Despite not being employed for the last 4 years, Emily and Matthew continued to pay off her student loans, which they finally succeeded in doing last year although she ended up paying about $12,000 in interest since she graduated. Then Emily starts thinking about all the intangible costs of motherhood.
Susie:She's really struggled over the last few years with isolation and loneliness, sometimes going days without talking to an adult besides her husband. She frequently wonders if she is actually depressed. She hasn't been able to prioritize her physical health. It's been years since she was able to regularly work out. And who has the time or energy to make all those organic healthy meals she sees on her friend's Instagram pages, especially when the kids just end up eating macaroni and cheese.
Susie:She used to enjoy sketching and reading, but it's impossible to concentrate on any creative endeavor anymore. Her attention keeps wandering, a result of years of hearing, Mom, mom, mom, watch this while trying to focus on something else. She and Matthew have done a pretty good job staying connected in their relationship. They try to do date nights once a month, but she often feels resentful about how much housework falls in her lap while he feels the stress of being the family's sole provider of income. An old colleague of hers recently reached out to see if Emily is open to coming back to work as a designer, but Emily feels so out of touch with that part of herself.
Susie:Returning to work sounds appealing but honestly a little overwhelming. She's struggling with low self esteem because she hasn't kept up with all the new computer design programs out there and isn't sure she has the brain power to learn it all over again. Besides, Ethan is only in preschool from 8 to noon, 4 mornings a week. And Lily's kindergarten is done by 2:30 PM. And there really isn't a firm out there that would hire her with that kind of availability.
Susie:And hiring a nanny to help out would just eat away at her income again. And the kids always seem to have sniffly noses. You know, what happens if one of them gets sick and she has to call out? Plus, she always seems so busy. There's always an errand to run or more laundry to do, groceries to buy, or the car needs service, or the dog has to go to the vet or she's waiting for the plumber.
Susie:It feels like her days fill up without even trying. They could really use the extra money, but the challenges of returning to work seem truly insurmountable. She's also thinking of a friend of hers who went back to work with 2 children and always seems completely exhausted and overwhelmed. Her friend was also recently passed over for a promotion that she really wanted and believes it's because she is perceived as less serious at work as her male colleagues because she is a mother. Emily continues to sit and drink her now cold coffee.
Susie:She feels a little guilty thinking about the cost of motherhood and hastily reassures herself that, of course, it's all worth it. She adores her 2 children, most of the time. And while there are plenty of intangible costs, of course there's also plenty of intangible benefits too. Would she have made the same choices? She reflects and concludes that, yes, she probably would have.
Susie:But while she has cherished the time spent with her children, she can't help but feel the economic weight of her choices. So there you have it. If you haven't already guessed, Emily's story is somewhat autobiographical. There are a lot of elements of Emily's story that are similar to mine, although she is 10 years younger than I am. So let's analyze a few elements of her story that to kind of tease out some of the costs of motherhood that Emily faced.
Susie:And before I get into that, I want to acknowledge that Emily certainly had an amount of privilege. I tried to create an experience that represents a so called average of experiences, but there's absolutely stories that can and should be told about mothers who are dependent on state aid, mothers who didn't go to college and haven't ever worked, who are trying to leave abusive or even just unhappy marriages, but have nowhere to go and no money or job skills to to leave. Right? There's stories of mothers who were forced to carry pregnancies they didn't want in states that now outlaw abortion. Stories of single mothers facing multiple jobs, disabled mothers facing additional discrimination, and so on.
Susie:So that all being said, let's just touch on a few of Emily's experiences to help get a picture of some of the elements that contribute to the cost of motherhood in the United States. 1st up, health care. The expenses associated with health care include insurance premiums, co pays, and any medical bills, and these costs can be a significant part of a family's budget, especially in the US. The latest data suggests that nearly 100,000,000 people, almost 1 third of our population, have medical debt ranging from 500 to $5,000. Nearly 30,000,000 people go without health insurance every year.
Susie:Individual people, health insurers, and federal and state governments spent approximately $4,000,000,000,000 on various types of health consumption expenditures, HCE, in 2021, which accounted for 17.4% of the nation's GDP. Compare this to Canada, which has a publicly funded plan that means all Canadian residents have reasonable access to medically necessary hospital and physician services without paying out of pocket. While the people in the US spent $4,000,000,000,000 on health care last year, Canada spent about 300,000,000,000. Health care costs in the US have a huge impact on mothers and families. Another major issue mothers face is the availability of affordable childcare.
Susie:So while Emily was able to get a relatively affordable in home nanny, mothers often face challenges in finding reliable and affordable childcare options. Paying for quality childcare can be a struggle for many families in the US. The cost of childcare is often the biggest part of a family's budget. Demand usually outpaces supply. And especially for infant rooms, sometimes you have to get on a waiting list while you're still pregnant.
Susie:Preschools are usually only a few hours a day, anywhere from 2 to 5 days a week. And even once when children are in school full time, the school day and the workday hours do not match up. Someone's gotta take care of the kids when they get out of school. Right? Childcare costs range widely depending on where you live, but you can expect to pay around 74100 to 15,400 a year for infant care.
Susie:And, of course, childcare workers themselves are often unpaid and overworked. Now let's look at income, the motherhood penalty, and retirement. So income and wages. Before women even have children, their income is penalized just for being a woman. The gender wage gap still exists, and women still earn, on average, 17% less than men.
Susie:Let's look at this over time. A recent report in Forbes Advisor says that a 20 year old woman just starting full time, year round work, stands to lose $407,760 over a Hispanic women making just 56¢ for every dollar that rural white non Hispanic men make. And then once women become mothers, it gets even worse. Obviously, we're all aware that the US is one of the few countries in the world that has zero paid maternity leave guarantee. And even with our meager job protection law of FMLA, only 40% of women qualify for this program, which still doesn't give any payment.
Susie:It just means they can't get fired if they take leave. So there's an immediate income drop for mothers just by taking time off to have a baby. Remember the fatherhood bonus I mentioned earlier? Well, mothers have the opposite with a motherhood penalty. The motherhood penalty is significant to the gender wage gap because studies found that employed mothers are the women that account for most of that gender wage gap.
Susie:So research shows that hourly wages of mothers are approximately 5% lower per child than the wages of non mothers and that 81% of mothers with children under the age of 18 made less than $40,000 per year compared to only 44% of fathers. There is also a hiring penalty. Mothers are 79% less likely to get hired than non mothers. And when they are hired, they are offered an average $11,000 less in income. A study by a Stanford sociologist found that employers perceived mothers as less competent than childless women.
Susie:And childless women are 8.2 times more likely than mothers to be recommended for management. For childless women, median earnings are $3850 per month compared to $1,409 for women with children. So mothers only earn 37% as much as childless women. So being a mother has a clear negative impact on a woman's job opportunities and income. What about retirement?
Susie:Well, if a mother isn't employed, she's obviously not contributing to any kind of retirement account offered by an employer. There are IRAs, individual retirement accounts, available for her to contribute to. And the US has a spousal benefit for Social Security that allows a married woman to claim up to half of her spouse's Social Security benefit. She's not, like, taking half of his benefit. Like, if he were to earn a $1,000 a month, he gets that, and then she gets $500 a month.
Susie:Right? Obviously, it's very complicated. Please don't quote me. But, like, that's there is that benefit. So, this is a good thing, right?
Susie:This does help offset. It was designed to help offset the penalty eligibility requirements, and with women earning more of their own income and rising divorce rates, only 18% of retired women took advantage of that spousal benefit in 2019. And then finally, let's look at the baby industrial complex. Look. Somehow humans survived 100 of 1000 of years without anything beyond maybe a sling for carrying their babies.
Susie:But now, in the US, baby products are a big business. Baby registries can have over 100 items on them. And every year, new products are introduced. There's a lot of pressure on parents to have the latest and greatest in toys, gear, technology, and more for their baby. Here are some stats.
Susie:The revenue of the baby diaper market in the US reached about 7,400,000,000 US dollars in 2022. And it is expected to further increase while baby and child skincare products racked up almost 424,000,000 US dollars in sales. The baby food market, which includes formula, is nearly another $7,000,000,000 industry. So looking at these specific drivers of the cost of motherhood, health care, childcare, capitalist economy is a system where the allocation of resources, goods, and services is primarily driven by market forces, specifically supply and demand. Prices for goods and services are determined through the interaction of buyers and sellers in free and competitive markets.
Susie:Meaning that in theory, the prices for these things aren't set by the government or centralized group, but instead they're set by what people are willing to pay for them. The primary goal of businesses within a capitalist economy is to maximize profits by producing goods and services that consumers demand while minimizing costs. And this is a key point that I'm gonna come back to next week. This is not the only way to run an economy. Let's just imagine.
Susie:What if the primary goal of businesses wasn't to maximize profits and minimize costs? What if the primary goal of businesses, the reason that businesses existed, was to meet the true needs of society in order to maximize health and happiness for all people while minimizing, let's say, the exploitation of humans and earth's resources. Just leaving that with you. Right now, health care, childcare, and products for children are supplied and produced not always in accordance with what people actually need, but they are produced to maximize profits for the owning class. The the board of directors, the individuals at the top.
Susie:There's a lot of money to be made in offering healthcare and a ton of baby products. And income and wages for employees are always in competition with the profits of the capitalist or owner class. So there's more incentive for owners to pay employees less, which is part of why we have 0 paid maternity leave, and still have a gender wage gap, all of which contribute to the motherhood penalty. And finally, in a capitalist economy, services like childcare are put out to the competitive market. So those with the most money benefit from the best options, like in home nannies, private day cares, and preschools, instead of being recognized that childcare is a fundamental infrastructure issue that is required by society in order for parents to go to work.
Susie:Okay. So there we have it. We've done a deep dive into the cost of motherhood in the US, seen through the lens of Emily's journey. A story that reflects the shared experiences of countless mothers navigating economic complexities of raising a family in today's world. From health care to child care, income disparities to the undervaluing of parental leave, the economics of motherhood are intertwined with larger societal issues that demand attention and action.
Susie:Next week, we'll explore how different economic systems, including capitalism and socialism, and alternative economies like economy of caring and the gift economy, might shape the experiences of motherhood. Because if we're gonna put mothers on a pedestal, we have to have realistic conversations about the costs associated with doing the most important job in the world. Stay tuned for more empowering stories and insightful discussions in future episodes of Rebel Mothers. Remember to subscribe, rate, and share this podcast to spread the message far and wide. Learn more at susiefishleader.com, and thank you for being part of the motherhood revolution.
