Michelle W Bowman: Working women in the pandemic era

Speech by Ms Michelle W Bowman, Member of the Board of Governors of the Federal Reserve System, at the Arkansas Women's Commission Meeting, Russellville, Arkansas, 17 August 2022.

The views expressed in this speech are those of the speaker and not the view of the BIS.

It's a pleasure to be with you today to talk about a subject that I experience directly-women's labor force participation. I come to this issue with a similar perspective to this Commission, being from a heavily rural state and a small farming and ranching community deep in the Flint Hills of Kansas. But I also have roots here in Arkansas, my husband's family is from Hardy, and my father's mother was from Little Rock. It's really nice to be back in an area where I spent a lot of time growing up.

My husband and I returned home to Kansas with our two children under three in late 2009, just as the impacts of the last financial crisis were making their way to rural areas. At the time, I was a community banker, which means I was also a very active member of the community. As I am sure many of you did then, I saw firsthand the economic impacts of the recession and the increased drug and opioid use that devastated many rural communities across the Midwest.

At that time, many in the community received benefits from well-intended programs created to provide assistance, which often made it very difficult for small employers to find employees. This was often because, as I learned when trying to hire employees at our local chamber of commerce, the benefit from taking a job was much less than the benefit one could receive from the government at that time while not working. This is one major similarity between the current experience and the last recession, except that in this episode, the benefits many received were far in excess of what they could earn from working. So much so that the benefits provided to a large number of Americans resulted in a significant increase in savings, which is only recently beginning to decline and likely leading many who had not yet decided to re-enter the workforce to find work. These labor supply problems, as I will explain, are a large part of women's experience in the workforce since the pandemic, and the lesson from this and other recessions is that policymakers need to carefully weigh all of the consequences of their decisions.