Here are three of the week's top pieces of financial insight, gathered from around the web:
Child care shortage hurts women
The difficulty of finding affordable child care and elder care continues to hold women back in the labor market, said Lydia DePillis, Jeanna Smialek, and Ben Casselman in The New York Times. An estimated 500,000 child-care and nursing-home workers have left the industry since 2020, and the impact is still being felt — primarily by working moms. The share of women participating in the workforce, or looking for jobs, has recovered "roughly as much as the share for men" since 2019. But federal data shows the comeback has been shaky. Many mothers have turned to self-employment. Others have sought reduced hours "to balance care responsibilities" at home. Among the slowest to return to work have been single moms, "a sign that the shortage of care is making them vulnerable."
Shock to Obamacare
Obamacare premiums could surge this fall if Congress doesn't act, said David Wainer in The Wall Street Journal. People insured through the Affordable Care Act have "largely been spared" the rise in health-care costs because of generous federal funding in the 2021 American Rescue Plan Act. The COVID-19 relief package "temporarily increased subsidies across the board" and allowed more people to qualify for care. If the subsidies expire, though, an enrollee in the low-deductible "silver" tier making $60,000 "would experience a 36 percent increase, or around $1,800 per year." Families and older enrollees would see even larger premium increases. Congress is trying to negotiate a deal before the subsidies expire and Open Enrollment begins on Nov. 1, just a week before the midterm elections.
Borrowing for daily purchases
Consumers are increasingly using "buy now, pay later" schemes to cover even everyday purchases, like groceries and gas, said Alicia Wallace at CNN. Companies like Affirm, Afterpay, and Klarna, which allow customers to split purchases into four or more installments, exploded during the pandemic. Their appeal was obvious: no credit check and zero or low interest; instead, the services make money by charging merchants a fee. But the payment plans may be luring some shoppers into buying more than they can afford. Since the services aren't regulated like loans, it's unclear just how much debt Americans are amassing. "Young people and the underbanked are being hurt badly," said Harvard Kennedy School fellow Marshall Lux, "potentially ruining their credit for years to come."
This article was first published in the latest issue of The Week magazine. If you want to read more like it, you can try six risk-free issues of the magazine here.