The Two-Income Trap Read Online Free PDF Page B

family from the 1970s we introduced in chapter 2. If Tom, who earned $38,700 a year (inflation-adjusted to 2000 dollars), was laid off from his job, he could dip into the public safety net and draw unemployment. But his unemployment check would cover only half of his previous salary, leaving a huge shortfall for basic expenses. Without half of his income, the family might face imminent disaster. But if Susan then entered the workforce to help her family through this rough patch, she could bring in much-needed income at just the right time. She wouldn’t earn nearly as much as Tom did, but on average she would bring in nearly $22,000 a year. 2 Assuming it took Susan a couple of months to find work, the family would just about break even. If Tom could find another job within six months (the limit imposed by most states on how long someone can collect unemployment benefits), 3 the family
should be able to weather the storm without any serious injury to their financial health.
    What if Tom never made it back to his original income? Susan’s new paycheck could still make the difference between their long-term survival and collapse. If Tom were able to return to work at a lower-paying job, or if he could find only a part-time job, even with his income cut in half, the now-two-earner family might approximate its earlier lifestyle—and its long-term economic prospects. Susan might need to remain in the workforce permanently, and the family would have no reserves to meet any future setbacks, but they could weather one hard economic blow—the permanent reduction of the primary breadwinner’s income—intact.
    Of course, Tom and Susan are merely an illustration; the realities of a father losing his job are far more varied and complex. 4 Researchers have found, for example, that a woman whose husband loses his job is more likely to enter the workforce if her children are older, perhaps because the higher cost of day care for small children can make a young mother’s return to work too costly. 5 Some longtime stay-at-home mothers may find that they lack marketable skills; others may be frustrated that only low-wage jobs are available to them. In addition, a stay-at-home wife may have difficulty finding work when layoffs, such as the one that caught her husband, are making jobs scarce in their locale. 6 Notwithstanding these difficulties, there is considerable evidence that as a family’s economic position deteriorates, stay-at-home wives do exactly what one might predict: They look for a job. Sociologists have found that a woman is far more likely to enter the workforce if her husband takes a permanent wage reduction, if he faces an extended period of unemployment, or if he receives little or no unemployment compensation. 7 This squares with common sense: If Tom found a well-paying job just a few weeks after being laid off, there would be little need for Susan to begin a job search. If, on the other hand, Tom couldn’t find a job, or if the only jobs he could find paid considerably less than his previous position, then there would be far more pressure on Susan to find a way to bring home some additional
money. Researchers have found that the effect of wives’ added income is not trivial; for the average married man who loses his job, his wife’s new income offsets more than 25 percent of his lost wages. 8 Indeed, that all-purpose insurance policy provided by the stay-at-home mother has paid off for millions of families.
    One of us [Elizabeth] lived this story back in the 1960s in Oklahoma. I was thirteen when my father had a heart attack. Daddy had been working on our car, lying on the driveway on a cold November weekend, when his chest began to hurt. He put off going to the doctor until the next morning, when he was immediately hospitalized. Forty years later, the snatches of conversation I overheard remain as vivid as if someone had just spoken the words: “the possibility of more attacks,” “not sure if he can ever work