Dear 100 Hour Board,
I heard a statistic on NPR that only 2 out of 10 homes has one parent that works (I'm assuming this is for a 2-parent household). Whey is there such a high percentage of families where both parents work? I'm not opposed to both parents working, but I know that for hundreds of years only one parent worked and it seemed to play out just fine (enough money, nobody hungry etc). Are things just more expensive these days?
People tend to have much, much smaller families today (outside of Utah, generally, people have more like 1 or 2 kids), and get married later (so more money saved up). Do people just have a higher expectation of what life should be like? (Big houses, two or three really nice cars, timeshares, etc). Are we living more extravagantly? Or is the minimum wage just too small (people keep saying that)?
Your questions touch on a number of economic topics, and I would like to point out just a few things.
- Female participation in the labor force: It is actually not true that "for hundreds of years only one parent worked." Before 1920, a large percentage of Americans had farms or were involved in agriculture. Anybody who grew up on a farm should know that this is a whole family effort. Not only did both spouses work hard, but children were also expected to significantly contribute to the farm from an early age. Also, even after 1920 and up until the 1950's, because of the lack of automation the responsibilities of the wife were vast and required much of her time. It's true that women did not work out of the home as often (except, perhaps, during World War II), but they worked nonetheless. So I don't think it is fair to state that women working is a recent trend: they have worked through most of history, and only for a few decades because of automation and high US incomes have they been able to spend less time working.
- Real wages over time: Your question "are things more expensive today?" is significant and difficult to answer. One way to measure "are things more expensive today?" is to look at the "real wage." The real wage is the wage divided by the overall price index of the economy. Basically, if I am paid $100 and things cost on average $25 to me, my real wage would be $4. If in five years I am paid $110, but the price of things in the economy have increased to $44, then even though I am being paid more in wages nominally, my real wage has decreased to $2.50. In a very crude way, the change in real wage shows the purchasing power of the money we make. Here is a graph of real wages over time (from The Current Moment):
The red line shows real wages, which appear to be flat since 1975. This graph of real wages does not paint the whole picture and there is some debate over various aspects. For example, if you include non-wage compensation (like medical insurance, social security contributions by employers, etc.) then real compensation isn't as flat. Also, this is a good outline, but it isn't very accurate because our consumption patterns have changed. In the 50's we weren't measuring costs of personal computers or cell phones. It's just very hard to compare these things, so take it with a grain of salt.
This flat trend of real wages shows that while standards of living have risen (implying we spend more on more things), wages are only tracking this rise. That implies that families that are larger or want to have a higher standard of living than the average must work much more than others: one way to do this is to have both parents work.
This trend also simply shows the average. If you look at unskilled labor, their real wages have increased even more slowly than somewhat skilled labor (see this page)! 60 years ago a man could earn a decent living for his whole family by being an somewhat-skilled laborer (eg. in manufacturing). This is absolutely no longer the case. The only group that has seen an increase to real wage are skilled laborers. This trend will continue into the future, which is why a college education is critical for most Americans.
- Minimum wage adjusted for inflation and effects on secondary earners: Your question of "is the minimum wage too low" probably does not play as much of a role as you might think in the discussion of two working parents. The evidence seems to show that minimum wage changes mainly affect secondary income-earning workers and teenagers. In other words, most primary workers (dads for the most part) are making more than minimum wage, so a change to minimum wage is unlikely to bump up their income to the level where it would affect the need of the other spouse to work. However, here is a graph of the minimum wage adjusted for inflation over time (source: US Department of Labor):
The red line is the minimum wage adjusted for inflation, showing that our minimum wage now is less than the minimum wage throughout most of the 50's, the 60's and 70's, and the early 80's if you adjust how much a dollar was worth then. I think there is a slight need to again increase the minimum wage for other reasons, but I don't think it will greatly affect whether both parents work, since the primary earner rarely makes minimum wage.
- Cultural notes: After the shift to machines and automation in the early-mid 20th century, duties around the house required significantly less time. This was accompanied with a large shift from the "do-it-yourself" mindset to "now-that-it's-cheap-at-the-store-just-buy-it." Of course, there were still costs to homemaking but instead of being paid with a woman's time, they were paid with money. Around the same time, it became more culturally acceptable for women to work outside the house and many women took up this opportunity. This contributed to the shift of women into the labor force. I think we are seeing similar forces at work now, pushing women back into the labor force today.
That was a rather long answer to your question because I think it's difficult to properly analyze. In summary: yes, things are more expensive and we live more extravagantly. Wages have risen to some extent to match this rise in prices, but not across all industries and not equally among skilled and unskilled laborers. Yes, the minimum wage is probably too small (in my opinion), but that probably doesn't have much of an affect on whether both parents work. This trend will continue into the future, and that's why it is so important to get an education so you are a skilled laborer who will see a rise in real wages into the future instead of a slow and steady decline.