In low- and middle-income countries, firms owned by women typically have lower profits than those owned by men. COVID-19 has exacerbated this profit gap as women-owned firms tend to be concentrated in sectors where demand has dropped the most, such as services, hospitality, and retail trade. Childcare is an additional constraint for women-led businesses. In one setting, up to 37 percent of female owners bring small children to work, compared to zero men (Delecourt and Fitzpatrick 2021). These childcare duties are correlated with a ‘baby-profit gap,’ as businesses where children are present earn 48 percent lower profits than other women-owned businesses without a child present. This study aims to understand how increased childcare burdens due to COVID-19 school closures have exacerbated existing gender profit disparities in Kenya.
In the first stage, the research team will collect new data to evaluate how the number and timing of children and childcare duties are associated with the profitability of women-owned businesses during the COVID-19 pandemic. The representative sample includes 1,000 firms in Kenya to see if birth and childcare duties were related to firm profitability and firm death. In the second stage, the team will pilot two light-touch interventions aimed at addressing the childcare-related constraints among businesses where women have children.
This project is a part of the Women's Work, Entrepreneurship, and Skilling (WWES) Initiative