Peter Schiff, a well-known investor and financial commentator, stirred up controversy by linking "married women entering the workforce" to skyrocketing home prices.
In August 2023, Schiff shared his thoughts in a post on X and his comments sparked backlash. However, he immediately clarified his position, explaining the broader economic context behind his remarks. Here's a breakdown of what happened and what Schiff was trying to say.
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In the original post, he wrote:
"The 30-year, fixed-rate #mortgage peaked at 18.45% in October 1981 and troughed at 2.65% in 2021. The current rate is 7.4% and rising. 40 years of falling mortgage rates, plus married women entering the workforce, allowed home prices to rise much faster than incomes. Look out below!"
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According to Schiff, decades of rate drops and more married women entering the workforce contributed to home prices outpacing income growth.
But the mention of married women entering the workforce set off a firestorm. Critics accused Schiff of unfairly blaming women for the housing crisis.
One user fired back:
"Really woman is the best reason you can come up (with)? I thought there was some reasoning to your predictions until now."
Another wrote:
"You just insulted every woman who fought tooth and nail to break the glass ceiling, compete in the workplace, [and] further civilization's progressive certainty."
Another offended user added:
"If this isn’t one of the most sexist statements. Just lost all respect for you."
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In response to the backlash, Schiff elaborated on his comments in replies to users. He explained that his point wasn't to blame women but to highlight economic trends and inflationary pressures that drove them into the workforce.
Schiff agreed with a user who pointed out that women entering the workforce wasn't a "cause of inflation" but rather a response to it. He replied to them, writing:
"Correct, plus rising taxes. Taxes and inflation reduced [the] real earnings of married men. So their wives were forced to get jobs to make up for that loss."
Schiff argued that high inflation in the 1970s and 1980s eroded household purchasing power, pushing many married women into the workforce out of necessity, not choice.
To understand his point, it is essential to look at the broader economic backdrop. In the late 1970s and early 1980s, runaway inflation led the Federal Reserve to raise the federal funds rate to 21% in June 1981. This move aimed to curb inflation driven by rising oil prices, government spending and wage increases. The result? Mortgage rates peaked at 18.45%, making homes far less affordable.
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As housing prices climbed, many households needed dual incomes to afford them. In Schiff's view, women entering the workforce wasn't a direct cause of rising home prices – it was a consequence of inflation and higher living costs.
Schiff also pointed to other factors contributing to the housing affordability crisis, such as property taxes, insurance and maintenance expenses. He warned that these costs will continue rising, especially as inflationary pressures persist.
While Schiff intended to outline economic trends, his phrasing – specifically mentioning married women in the workforce – was seen by many as outdated and reductive. Critics argued that it undermined women’s progress in the workplace and ignored other systemic factors in the housing crisis.
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But Schiff clarified that he wasn't assigning blame. Instead, he highlighted how economic shifts have forced families to adapt in ways that weren't as common in previous generations.
His remarks tie into a broader discussion about housing affordability. In the early 1980s, the home price-to-median household income ratio was around 4.6, according to data reported by the site Longtermtrends. By 2022, that ratio had ballooned to over 8. This means homes today are significantly more expensive relative to household incomes than four decades ago.
Peter Schiff's comments may have been poorly phrased, but they highlight the deeper economic pressures shaping today's housing market. Inflation, rising taxes and other systemic factors have necessitated dual incomes for many households. Economic trends are complex and interconnected, often driving changes that reshape how families live and work.
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