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Women in the Economy

Tuesday October 2002


Celeste Colgan Senior Fellow, National Center for Policy Analysis

The entry of women into the labor market has been one of the most important economic and sociological changes of our time. Today, more than 75% of women between 25 and 55 are working, and more than 60% of them have children under 6. These changes have had a major impact. The proportion of 'traditional' married couples with one wage-earner and a stay-at-home spouse has fallen from almost 90%, to just over one-third. Dual-earner families, with both spouses working, comprise almost 2/3 of all married couples.

Many government policies, however, are a legacy of the time when households were assumed to be made up of a single breadwinner and a stay-at-home wife. A wife who enters the labor market is taxed at her husband's tax rate. If she is in a middle-income family, she can keep only about 35 cents out of each dollar she earns. The federal law controlling health insurance and pensions, designed to accommodate a full-time worker with a stay-at-home spouse, penalizes any other arrangement.

Celeste Colgan of the 'Women in the Economy" project at the National Center for Policy Analysis, takes a critical look at tax law, employee benefits, Social Security and a host of other institutions. She makes a compelling case that government policies-on issues from taxation to health care to retirement plans' must be overhauled because they were formulated during a time when the role of women in society was far different than it is today.