The Motherhood Penalty in Labor Force Participation

While it may seem that women's participation in the labor force has increased significantly in recent decades, that is not the case – at least not at the global level. While the labor force participation rate for women aged 25-54 did in fact climb from 67 percent in 1990 to 77 percent in 2021 in high-income countries, things are looking differently in all other income groups. According to estimates from the International Labour Organization (ILO), only 61.4 percent of women in prime working age were either employed or actively seeking employment globally in 2022, which is actually a small decline from 62.8 percent in 1990.

Moreover, there is still a significant gender gap in labor force participation rates, with women often facing challenges that their male counterparts do not. According to the ILO, the gender gap stood at 29.2 percentage points in 2022, with child-rearing seen as a major factor in lowering women’s labor force participation. As our chart shows, the labor force participation gap widens to 42.6 percentage points for couple households with at least one child under six due to the so-called "motherhood penalty." The motherhood penalty refers to the negative impact that having children can have on a woman's career.

Not only do women still shoulder the larger part of caregiving responsibilities in many families and cultures, but they also face discrimination and bias when it comes to hiring, promotions, and pay. While having to balance caregiving and professional responsibilities is hard enough, it is made even harder by such hurdles, which is why flexible work arrangements and other policies such as paid parental leave are crucial to encourage mothers to stay in or re-join the workforce after giving birth.

While the ILO notes that the motherhood penalty can be observed across all regions and income groups, there are differences in its extent. While mothers are almost 20 percent less likely to be part of the labor force than women of the same age group are overall, the penalty is significantly smaller in lower-middle-income and low-income countries at 4.3 and 5.4 percent, respectively. Interestingly, the opposite can be observed for men, who are more likely to be in the labor force when they have a child under six. This “paternity premium” contributes to an even wider labor force participation gap among parents.