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Boushey, 20 October 2005, p. 1 When Women Get Paid for Work: The Entry of Women to the Paid Labor Market CEPR Basic Economics Seminar Heather Boushey October.

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Presentation on theme: "Boushey, 20 October 2005, p. 1 When Women Get Paid for Work: The Entry of Women to the Paid Labor Market CEPR Basic Economics Seminar Heather Boushey October."— Presentation transcript:

1 Boushey, 20 October 2005, p. 1 When Women Get Paid for Work: The Entry of Women to the Paid Labor Market CEPR Basic Economics Seminar Heather Boushey October 20, 2005

2 Boushey, 20 October 2005, p. 2 Todays talk The past half-century has witnessed a significant and sustained rise of womens labor force participation. In the 1960s, the majority of mothers worked at home, by the 1990s, the majority were in the paid labor market. –The labor force participation rate (LFPR) is the share of the population either at work or searching for a job (unemployed). This is one of the most important, society-altering trends of our recent history, one which we, as a society, have not yet fully adjusted to. In the next seminar series, we will focus on the gender pay gap, including the mommy pay gap.

3 Boushey, 20 October 2005, p. 3 Were women pushed or pulled into the labor market? Is work a choice that women make for their own benefit or is it necessary to sustain their and their familys livelihood? The answer will significantly affect how we think about policy. Recent media about women opting out of employment highlights the lack of resolution to this question.

4 Boushey, 20 October 2005, p. 4 Figure 1. Labor supply of men and women, age 20 and over

5 Boushey, 20 October 2005, p. 5 Figure 2a. Labor supply of women by presence of children

6 Boushey, 20 October 2005, p. 6 Caveat: Women have always worked By 20 th century, paid work (valued work) mostly occurs outside the home. –Historically, wives were seen as the husbands yoke-mate (Coontz 2005, p. 110), participating fully in the familys farm or trade. –Initially, women still had intensive housework, but latter 20 th century technological advances limit the needs for an industrious homemaker. Lower-income women, women of color, and immigrant women always had been more likely than middle-class white women to work outside the home. Work in the home is also work, even though its unpaid.

7 Boushey, 20 October 2005, p. 7 Caveats aside, why did womens LFPR increase? Was it family economics pushing them towards employment? Was it the feminist movement that opened the doors for womens employment (empowerment)? Short answer: BOTH –In Seminar 3, John Schmitt showed two figures that I want to review.

8 Boushey, 20 October 2005, p. 8 Womens earnings critical to family income (push factors) Without the contribution of wives, families would have seen a decline in income (Figures 3 and 4, Table 1). As was, income was relatively flat from the early 1970s onwards, compared to the period from WWII until the early 1970s (Again, a figure from Johns presentation, Figure 5). Critical for economic mobility (next weeks topic) (Table 2). –Bradbury and Katz (2004) found that favorable family income mobility outcomes are associated with greater wives labor market activity.

9 Boushey, 20 October 2005, p. 9 Figure 3. Real hourly wage growth, men, Source: John Schmitt, Labor markets and economic inequality in the United States since the end of the 1970s.

10 Boushey, 20 October 2005, p. 10 Figure 4. Real hourly wage growth, women, Source: John Schmitt, Labor markets and economic inequality in the United States since the end of the 1970s.

11 Boushey, 20 October 2005, p. 11 Table 1. Income growth, married-couple families with children Bottom fifth Second fifth Middle fifth Fourth fifth Top fifth %3.4%8.4%12.6%20.4% Percent change in income without wives earnings, Contribution of wives, Source: Mishel, Bernstein, and Allegretto, The State of Working America , p. 104.

12 Boushey, 20 October 2005, p. 12 Figure 5. Real median family income, Source: John Schmitt, Labor markets and economic inequality in the United States since the end of the 1970s.

13 Boushey, 20 October 2005, p. 13 Table 2. Decomposing annual earnings growth, prime-age wives with children Bottom fifth Second fifth Middle fifth Fourth fifth Top fifth Growth in annual earnings %86.6%78.5%71.4%86.1% Due to more annual hours More wives working More weeks per year More hours per week Due to higher wages Source: Mishel, Bernstein, and Allegretto, The State of Working America , p. 105.

14 Boushey, 20 October 2005, p. 14 In short, economics of the family requires a second earner In most families, a woman works because she has to, not necessarily because she wants to have a career. It is the case that not working carries long- term penalties in terms of wage gains, but working under those conditions is certainly not a choice. There are also cumulative effects, when women moving into paid employment is part of a broad transformation of social life.

15 Boushey, 20 October 2005, p. 15 Figure 6. The two-income trap Source: Warren and Tyagi, The Two-Income Trap, p. 51.

16 Boushey, 20 October 2005, p. 16 Answer to push or pull affects how to think about work/family Centuries-long movement of work out of the home requires a new mode of care and household production. –Children, sick, the elderly need care. –Historically, provided while women worked at home (farm, trade), alongside those needing care. –More recently, greater commute times (suburban living) necessitates even longer hours of care.

17 Boushey, 20 October 2005, p. 17 Women in paid employment is causing broad transformations Workplace practices. Family practices. Social policy. This is not to say, however, than any of these changes necessarily have occurred.

18 Boushey, 20 October 2005, p. 18 Workplaces have still not adapted Most workers (over 60%) do have access to paid sick days when their children take ill. Long hoursand increasing hours of work, especially to get ahead in elite and semi-elite fields. Limited opportunities for part-time employment at parity with full-time in terms of pay scale, promotion opportunities, and benefits.

19 Boushey, 20 October 2005, p. 19 Family life showing some signs of adaptation Time use surveys reporting show that men are increasing parental/housework hours while women decreasing. –Still, women do about twice as much housework as men. FMLA often used by men, but usually for own illness.

20 Boushey, 20 October 2005, p. 20 Social policy remains unfocused on family realities The U.S. has no national paid maternity or paternity leave. U.S. workers have no right to paid sick days. Child care inadequate and school districts still have less than full-day kindergarten.

21 Boushey, 20 October 2005, p. 21 So, are women opting out of employment by choice? Louis Story, Lisa Belkin, etc. argue that elite women are choosing to stay home rather than work. But: –Most families need mothers wages. –Most families do not have the luxury of adaptive institutions.

22 Boushey, 20 October 2005, p. 22 Figure 2b. Labor supply of women by presence of children

23 Boushey, 20 October 2005, p. 23 Lackluster labor market led to falling employment Women were especially hard hit during the recession of Prime-age women with children (ages 25 to 44) saw a 4.4 percentage point decline in their employment rate from 1999 to –However, a large drop (-3.2 percentage points) also occurred for women without children. –Indicates that the drop in womens EPOP is not due to mothers opting out of employment, but is rather a widespread phenomenon among women, as well as men.

24 Boushey, 20 October 2005, p. 24 Figure 7. Changes in employment level, men

25 Boushey, 20 October 2005, p. 25 Figure 8. Changes in employment level, women

26 Boushey, 20 October 2005, p. 26 Work Cited: Gender Bias in the Current Economic Recovery?: Declining Employment Rates for Women in the 21st Century by Heather Boushey, David Rosnick, and Dean Baker, August labor_markets_2005_08_29.pdf

27 Boushey, 20 October 2005, p. 27 When Women Get Paid for Work: The Entry of Women to the Paid Labor Market Heather Boushey Center for Economic and Policy Research


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