Women’s Economic Influence Is Growing Amid Financial Strains. How Banks Can Help

Women are playing a central role in the current U.S. labor market, but the economic picture is uneven, according a new report from the Bank of America Institute. Job growth in 2025 was heavily concentrated in sectors such as healthcare and education, where women make up the majority of workers. As a result, women accounted for nearly three times as many job gains as men during the year.

At the same time, broader labor market momentum has cooled. Workers are switching jobs less frequently, which historically has been the fastest path to higher wages. Pay increases tied to job changes have fallen sharply compared with pre-pandemic levels.

These trends are beginning to shape household spending patterns. As wage growth slows and affordability pressures persist, women are increasingly prioritizing value when shopping — particularly in categories like apparel and groceries.

These shifts in women’s employment and spending behavior will increasingly shape consumer financial activity.

Need to Know:

• Women are driving labor market growth — adding jobs at nearly three times the rate of men in 2025. Employment gains in 2025 were concentrated in female-dominated industries such as healthcare and private education.
• Job switching has slowed significantly. Workers are changing jobs less frequently, limiting one of the most reliable paths to higher wages. The job change rate in January 2026 was 2.1% for women and 2.0% for men, reflecting a slower labor market.
• Pay growth has moderated across the workforce. The median pay increase from changing jobs is now less than half the 2019 average.
• Consumer spending is shifting toward value. Women are increasingly choosing lower-cost retailers and products, reflecting pressure on household budgets.

Women are at the Center of Labor Market Growth

During 2025, women accounted for nearly three times as many new jobs as men. That represents a reversal from several previous years when male employment rebounded faster following the pandemic recovery.

The explanation lies largely in industry composition. The strongest hiring last year occurred in sectors where women already dominate employment, particularly healthcare and private education. Women hold roughly 77% of jobs in these sectors, and both industries have continued to expand steadily.

Healthcare employment alone averaged 33,000 new jobs per month during 2025, more than double the pace of overall payroll growth. This sustained hiring has helped anchor the broader labor market even as growth in other industries has slowed.

For retail banks, this trend matters for two reasons.

1. Employment concentration affects where income growth occurs. When job creation is concentrated in specific sectors, the households connected to those industries are more likely to see stable earnings and spending power.
2. Women remain key financial decision-makers within many households. When employment growth disproportionately benefits women, it can influence spending priorities, saving behavior, and borrowing decisions across millions of households.

Slower Job Switching = Cooler Wage Growth

Despite strong hiring in some sectors, overall labor market momentum has moderated.

One of the clearest signals is the slowdown in job switching. Workers historically receive their largest pay increases when moving to a new employer. Over the past year, however, fewer workers have changed jobs.

As a result, the “job-change premium” — the pay bump typically associated with switching employers — has declined significantly. According to the report’s analysis of deposit account data, the median pay increase associated with a job change is now less than half the level typically seen in 2019.

Pay increases for both men and women have slowed. While women continue to maintain a modest edge in job-change wage gains, that advantage appears partly tied to industry mix and starting salary differences.

The broader takeaway is that the labor market has moved into a “low-hire, low-fire” phase, where companies are cautious about expanding headcount and employees are less inclined to change jobs.

This slower wage growth has direct implications for customer financial behavior:

• Consumers may become more cautious about discretionary spending.
• Deposit growth may stabilize rather than surge.
• Demand for short-term credit products could increase as households manage tighter budgets.

Understanding these shifts can help institutions anticipate changes in transaction volume, savings behavior, and borrowing activity.

Spending Shifts Toward Value Retail

These changes in labor market conditions are already shaping how households spend money.

As wage growth slows and affordability pressures remain elevated, consumers are increasingly prioritizing value-oriented spending in recent years.

The report tracks spending across groceries, apparel, restaurants, and travel at premium, standard, and value spending tier composites. In the value category of spending, this means a consumer spends the majority of their money at value stores for groceries, restaurants, and apparel with no travel spending.

Women, in particular, have shown a slightly stronger shift toward value retailers than men. The data also suggests that women’s spending tier has improved in all categories over recent months, except apparel. This may indicate that consumers are actively adjusting their purchasing strategies in response to economic conditions.

Changes in spending habits can signal broader changes in household financial health. Transaction-level data often reveals these patterns early. A steady movement toward value retailers may indicate:

• Increasing price sensitivity
• Reduced discretionary spending
• Greater focus on budgeting and financial planning

Institutions that track these signals closely can adapt marketing, product offerings, and financial guidance accordingly.