Friday, January 27, 2006

Women's participation in the workforce

There has been a frenzy of comment in the US blogs I read about a recent article arguing that
"Half the wealthiest, most-privileged, best-educated females in the country stay
home with their babies rather than work in the market economy"

Further research by US demographers (as opposed to anecdotally interviewing women who announced their marriages in the style section - good statistical method!) suggested that the "child penalty" (i.e. the reduction in participation rate from having children) in the labour participation rate had closed in the US in the last few decades.

In Australia, as this week's AFR magazine points out, women with children are quite a lot less likely to work than those without, particularly women with degrees. NATSEM is a research centre associated with the University of Canberra that does a lot of microeconomic research, and recently has teamed up with AMP to provide some fairly definitive data.

Although the participation of women in the labour force has increased steadily in the last 20 years (from 45.7% to 56.7%), the participation of women aged 25-44 with dependent children has dropped in the last 10 years (1993 - 2003). And the proportion of women working full-time, with or without children, seems to have almost uniformly dropped in that time. Older women (45-64) with or without dependent children are much more likely to be working than they used to be.

Looking at women working full-time, the "child penalty" is by far the greatest for women with degrees - a 25% difference in full-time participation between women with and without dependent children. For women with no post-school qualifications, they are actually more likely to work full-time if they have children than if they don't.

So what's happened in the last few years is that women are more likely to be working than they used to be, but less likely to be working full-time, and that mothers are less likely to be working, even part-time, than they were 10 years ago. The "child penalty" for full-timers hasn't changed, though. It seems that what's happened is that women have generally cut back on their hours - full-timers to part-time, and part-timers to nothing (particularly if they have children). And older women (likely to be mothers of older children) have got back into the workforce in increasing numbers.

Without income and status statistics about the jobs, it's hard to tell if women are "wasting" their degrees, as Linda Hirshman said in her original article. But the increasing participation of older women in the labour force suggests to me that there is hope that women are taking some serious time off to have their children, but it isn't forcing them out of the workforce forever.

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