nicki hutley

COVID-19 legacy: Women must not bear burden of next shock

Economist Nicki Hutley lays out the legacy likely to be left by COVID-19 and warns that women must not bear the burden of the next shock.

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There can be no doubt that COVID-19 has placed a greater burden on women in myriad ways.

In the wake of the 2020 Federal Budget, a common criticism was that much of the stimulus was “blue”, when the recession itself appeared to be clearly “pink”.

In other words, even though women bore the brunt of the recession, especially in terms of employment outcomes, many of the stimulus measures would benefit male-centred sectors such as manufacturing and construction.

Nevertheless, the evolving nature of the recession – which is unlike any other we have experienced –  and the industries affected is changing our understanding of COVID-19 impacts, both short- and long-term, on a week-by-week basis. Recovery is well and truly underway even if we face a long and winding road back to pre-COVID conditions.

So how do we read what has happened from a gender equity perspective, and what are the lessons to ensure women don’t bear the burden of the next shock?

The Financy Women’s Index (FXW) has illustrated the clear disparities that COVID-19 has imposed on employment across sectors, both in terms of lost jobs, hours and participation. Indeed, it has been well-documented that, at the height of the crisis, female dominated sectors were hardest hit by health restrictions – think accommodation and food services, retail, and the arts.

Accommodation and food services as well as the arts, remain the hardest hit sectors, according to the Australian Bureau of Statistics’ Weekly Payroll data, with payroll jobs down 15.5% and 12.8% respectively from 14 March to 31 October. And the figures for women in Victoria have been particularly dire with the second lockdown.

The silver lining, if it can be called that, was the brief period of free childcare. It was a massively missed opportunity for the Federal Government not to introduce this support on a permanent basis and generate significant long-term increases in female participation and economic growth. (It has, of course, been good to see state governments responding to the recession with gendered policy such as free kinder programs in Victoria and business support grants for women in NSW.)

And yet, it is clear that recovery is now well and truly underway, even if unemployment remains unacceptably high and the road back is long and winding. Interestingly, and unexpectedly, most recent data suggests that women’s jobs, on average, have come back faster than men’s, as shown in the chart below.

Of course, what we don’t yet know is whether the gain in jobs – for either men or women – have come at the same skill and pay level as before. And we also know that, with the withdrawal of Federal Government stimulus in the new year, we have not seen the end of job losses.

Another pleasant surprise, participation has roared back with male rates returning to February levels in October, and women’s rates just 0.2 percentage points away. This contrasts starkly with the extended downturn in participation seen after the last two recessions in Australia.

On the less rosy side, we are still witnessing significantly higher rates of underemployment for women. This was already a deep problem before COVID-19, and it has been exacerbated by the virus. And many women, especially younger women, have raided their super balances, which will have severe implications for them as they approach retirement.

Extrapolating from all these trends, which continue to evolve, is difficult and the lasting impacts of this recession on gender equity will not be known for perhaps years.

What we can say, however, is that women were disadvantaged in many areas before COVID and  for much of this year it has been women that have been disproportionately affected by the virus and the recession.

However this plays out from here, COVID-19 will leave two legacies for women. The first lies in the direct impact on women as workers, often casual, in the most vulnerable sectors, and as primary carers.

The second, and more important, legacy will be the policies implemented to address those imbalances. Policies that will ensure that, when the next shock occurs – be it another virus, extreme weather disruptions or financial sector driven – women do not again bear a disproportionate burden.

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