Call it the “Ladybucks” Recession

Investable Universe
4 min readDec 18, 2020

This week, the International Monetary Fund (IMF) circulated a report finding that while global “contact-intensive sectors” with a large proportion of female workers — including services, hospitality, retail and tourism — ground to a standstill early on in the covid-19 pandemic, an analysis of real-time job listings data across 22 advanced economies shows women continuing to drop out of the workforce at “an alarming rate.”

While it may not be surprising to confirm women’s higher rate attribution from jobs requiring in-person contact (a global trend that IMF Managing Director Kristalina Georgieva and her colleagues explored earlier this year), this latest study, authored by IMF Asia and Pacific Department Senior Economist Wenjie Chen, has concluded that women are being disproportionately, negatively affected even in jobs that are more conducive to remote work.

Wenjie Chen’s research examined job postings in 22 countries — a data set that does not capture informal or unpaid employment, and skews toward developed economies — and found a steeper decline in online postings for job classifications with higher shares of female workers versus male workers. On average, across all sectors, Wenjie Chen measured a gap of six percentage points between male versus female-predominant job postings.

Moreover, she found, this six-point gap has remained consistent through the sample period, from the onset of covid in March to as recently as October.


This phenomenon, she outlined in a recent IMF podcast, has negative ripple effectsalong the income spectrum. Women’s workforce exits have long-lasting negative future impacts in terms of earnings and lost retirement savings, all of which can be difficult to recoup, even for those who eventually return to paid employment (usually at lower salary and seniority levels). This is particularly damaging for lower-income families, who lose a critical source of immediate income.

And even for the “privileged” — working women who can do so remotely — many have struggled in the ongoing pandemic to balance work responsibilities with lack of childcare and daycare closures, a shift to remote schooling requiring greater parental involvement during school (work) hours, and the shouldering of greater domestic responsibilities, all of which may add to physical and mental health risks and increased risk of burnout.

“There are also macro-economic impacts and secondary impacts,” Wenjie Chen explained. “If women — [who] are important representations of the overall workforce — are leaving the workforce, and also scaling back employment, overall you can see that spending is going down. In terms of overall consumption, we also see negative impacts of that.”

“All In”

Earlier this month, public and private equity data provider Pitchbook released its second annual report exploring global venture capital investment in female-founded startups. Their report, All In: Women in the VC Ecosystem, published with support from Microsoft and women’s VC and innovation network Beyond the Billion, concluded that despite a decade of investment gains for women-founded companies, VC funding to female founders in the U.S. for the year to date is down 31 percent from 2019 levels, compared to a 16 percent decline for all-male teams.

Venture capital funding for women had notched a record year in 2019, with Pitchbooknoting that startups with at least one female founder received 23.8 percent of all VC investments that year (almost double the level from 2010).

While VC funding commitments to female founders have dropped disproportionately since the onset of covid, valuations for these companies are also markedly lower. Pitchbook’s analysis found that while female-founded companies have historically received a slightly (less than 10 percent) lower valuation in early-stage funding rounds compared to the broader market, this gap tends to widen in late-stage, pre-money valuations.

Pitchbook’s analysis of 2020 data found that this late-stage valuation gap for female founders and the broader VC market since the onset of the pandemic is the largest it has ever recorded. Median valuation for female-founded companies dropped from $62.5 million in 2019 to $59.6 million for 2020 year-to-date, while the median late-stage valuation for all VC-funded U.S. companies increased from $70 million to $87 million during the same period.

“It is encouraging to see the impressive growth in fundraising and performance by female-founded startups over the past decade, but the setbacks from covid-19 underscore how vital it is to continue to push for gender equality in the VC ecosystem,” PitchBook VP of Research and Analysis Adley Bowden said in connection with the report. “The report shows female founders and CEOs continue to exit faster and at higher values, which should signal to investors that diverse teams are not to be ignored. We hope clear data on the funding gaps and proven performance of female-founded startups will empower VC’s and institutional investors to allocate more funds to these companies and prioritize placing women in decision-making roles within their own firms.”



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