Between January and August 2025, approximately 455,000 women left the U.S. labor market, with 42% citing caregiving responsibilities as the primary reason, according to a Catalyst report. The exodus highlights ongoing challenges posed by rising childcare and eldercare costs that outpace wage growth, contributing to workforce attrition amid inflexible job structures.
Caregiving Costs and Workforce Participation
The Catalyst study found that 37% of women who exited the workforce pointed to lack of schedule flexibility, while 18% said the trade-off between caregiving expenses and their salaries no longer made economic sense. Additional factors included pay dissatisfaction and job market uncertainty. LendingTree data from November 2025 shows that in major U.S. metro areas, childcare costs often surpass rent. For example, infant care averages 25.3% cheaper than a two-bedroom apartment’s rent, but families with multiple young children face even higher relative costs.
Labor Market and Employer Responses
Catalyst President Jennifer McCollum emphasized that women’s departures are not due to lost ambition but the disconnect between job design and caregiving realities. She warned that without intervention, these trends could precipitate a long-term labor shortage and higher service costs. Meanwhile, business groups caution that expanding workplace flexibility or government childcare programs may increase operational and taxpayer expenses amid existing inflation and labor shortages.
Federal Reserve research signals a still-tight labor market with rising female labor force participation but acknowledges multiple influences, including childcare costs. Employers have grappled with balancing flexibility and operational needs, with some reducing remote work options since the pandemic.
Policy and Workplace Implications
Catalyst’s research director Sheila Brassel stated employers must implement meaningful policies addressing caregiving to retain and re-engage female workers. The report calls for flexible scheduling, equitable pay, and supportive workplace structures that align with women’s caregiving responsibilities. Failure to adapt job models risks further displacing women from the workforce, exacerbating labor market challenges.
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