When new parents are struggling to juggle high-powered careers and young children, they sometimes do a quick calculation: Add up the cost of child care, commuting, and other work expenses; subtract it from the family’s second income after taxes (using the couple’s marginal tax rate).
Because u.s. childcare costs can run $15,000 per child per year at a child care center or $40,000 for a nanny, this calculation often shows that the family isn’t benefitting much financially from that second income. This can lead couples to decide that one of them — usually the wife — should stop working, at least for a time.
In Professor Myra Strober’s Work and Family course, students learn to also take into account the impact on lifetime earnings.
When highly educated women leave the labor force for two years, they earn an average of 18 percent less on their return than they would have had they continued working, according to a study published in a 2007 book by Sylvia Ann Hewlett, Off-Ramps and On-Ramps.
The difference between dropping out and continuing to work could be larger or smaller for any individual, Strober points out. For example, a person who stays in the workforce might aggressively pursue promotions and earn more than average, or he or she might decide to pull back while continuing to work, earning less. The same is true for individuals who leave the workforce and return: The time it takes to regain a former earnings trajectory depends on the kind of job they get, which can be affected by everything from the industry to the strength of their networks.
One alumnae group is trying to help GSB women go beyond the drop-out or stay-in calculation to focus on developing skill sets for juggling parenthood with work, says Mercy Eyadiel of the MBA Career Man-agement Center. One of the projects of the Business School’s Women’s Initiative Network (WIN) is collecting insights from alumnae who have handled transitions such as becoming consultants in order to better manage their careers and personal lives. “In our current work environment, knowing how to parachute into a position and work efficiently with a team is a great skill set that many successful women have developed. WIN would like to see more get training in those skills,” Eyadiel says.
In any case, it is critical that both men and women value their careers equally, Strober said. “A couple shouldn’t think that the cost of child care has to be covered by the wife’s salary.
– by Margaret Steen
Also on Stanford Knowledgebase: