female's employment growth: the role of demography, employment intensity and human capital...

Female's employment growth: the role of demography, employment

intensity and human capitalNEUJOBS WORKING PAPER NO. D16.1

Piotr Lewandowski, Iga Magda, Jan Baran,Olena Fedyuk, Attila Bartha

Introduction

• During the last two decades women’s employment rates have improved significantly in virtually all EU member states. At the same time the employment rates of men fell down.

• Increases in women’s employment were strong enough to alleviate the negative developments in male employment, so total employment rates rose.

• Yet, the observed changes were heterogeneous across countries and age groups.

1. Introduction2. Changes in employment

rates3. Decomposition method4. Decomposition results5. Policies behind6. Summary

Introduction

• The aim of the paper is to present a picture of female employment evolution in the EU over last 20 years with special attention paid to factors behind those changes.

• Quantitative analysis covers decomposition of female employment rates into (i) intensity, (ii) education and (iii) demography components.

• For more details see Neujobs WP D16.1.



Change in female employment rates – 1990s

• Significant improvement among women aged 25-44 and 45-54 …

• … but little change for younger and older women.

• Signs of convergence in female employment rates, especially for the prime-aged women.

• Outstanding economies:– IE and NL – strong

improvements in all age groups



15-24 25-44

45-54 55-64

Change in female employment rates – 2000s

• The 2000s brought a different age pattern of employment changes

• Employment rates of younger women decreased in majority of EU countries …

• … whilst almost all positive changes were contributed by women aged 45-54 and 55-64

• Outstanding countries:– DE – the strongest

improvement for women aged 55-64

– ES – positive change in most age groups besides severe economic downturn



15-24 25-44

45-54 55-64

Decomposition: intuition behind

What caused improvements in women’s employment rates? Three possible explanations:

– effect of demographic structure shift:For instance, if the share of prime-aged women increases, the overall employment rate rises as this age group has above-average employment rates.

– impact of changes in educational structure:As more educated women experience higher employment rates,

improvement in educational structure rises employment rates.

– improvement in intensity factor:It reflects changes in the institutional setting shaping individual labour supply curves. Simply speaking, more women, besides their socio-demographic characteristics, works in the market.



Decomposition: maths behind

A change in total employment rate (age group 15-64) can be decomposed into the contribution of components determined by the characteristics of labour force (LZ), demographic factor (D), labour utilisation intensity (I) and quality of workforce (J).



where: K – analysed moment of time; O – reference moment of time;ER – employment rate;P – population size; w – level of education (tertiary, secondary, primary); p – gender; k – age group (five-year age groups between 15-64)

Results for EU 12 in 1990s

• Intensity improvements contributed to ¾ of total women’s employment growth in EU12 in both decades.

• In 1990s, significant improvement of employment of women aged 25-54 is explained by a simultaneous increase in all three components

• Demographic factor was important for specific age groups, but had virtually no effect on total change.



• Improvements in education structure accounted for 30% of female employment growth, and were uniformly distributed between age groups

Results for EU 15 in 2000s

• Intensity improvements played a key role, but the contribution of older age groups was significantly higher than that of prime-aged women.

• Postive influence of demographic factor also moved towards older cohorts, but overal demographic factor had little negative effect on total female employment change.

• The size of quality contribution was similar to the previous period, indicating that women’s qualifications steadly rose.



• Negative intensity contribution of young women - females postpone entering the labour market. It coincides with rising incidence of tertiary education.

1990s (EU12) vs. 2000s (EU15)

• In 2000s, greater intensity contributions moved towards women of older age groups.

• Rising and positive contribution of intensity among women outweighted declining and negative intensity of men.

• Quality contribution among women was higher than among men.

• Women’s contribution played a crucial role in invigorating Europe’s employment.



1990s

2000s

Women Men Total

15-24 25-44 45-54 55-64 15-64 15-64 15-64

EU12 (1992 – 2000)

Intensity -0.19 0.84 0.54 0.26 1.45 -0.68 0.77

Quality 0.04 0.30 0.17 0.09 0.60 0.18 0.75

Demography -0.57 0.22 0.45 -0.01 0.09 0.46 0.57

All -0.72 1.36 1.16 0.34 2.14 -0.04 2.10

All w/o demographics

-0.15 1.14 0.71 0.34 2.04 -0.50 1.52

Women Men Total

15-24 25-44 45-54 55-64 15-64 15-64 15-64

EU15 (2001– 2011)

Intensity -0.24 0.19 0.79 1.12 1.86 -1.00 0.96

Quality 0.02 0.43 0.13 0.17 0.76 0.24 0.91

Demography -0.16 -1.00 0.66 0.31 -0.19 -0.11 -0.31

All -0.39 -0.37 1.58 1.60 2.43 -0.87 1.56


-0.23 0.63 0.92 1.30 2.62 -0.76 1.87

Results for NMS in 2000s

• Intensity growth among women aged 45-59 was the main factor driving women’s employment rates in the NMS but:– The contribution was smaller than

in EU15 and…– among women aged over 60

intensity declined.

• A pronounced contribution of a quality factor in NMS which can be attributed to tertiary education boom amongst younger cohorts.



• Demographic structure in NMS is different than in EU15, but so far demographic factor had little total effect on employment rate.

NMS vs. EU15 (2000s)

• Both NMS and UE15 exhibitted similar age pattern of intensity contribution, but its total was negative in NMS.

• Intensity contribution of women aged 55-64 was weaker in NMS (both in absolute and relative terms).

• Greater quality contribution in NMS compensated, to some extent, poor intesity contribution, especially in case of prime-aged women.



NMS

UE15 Women Men Total

15-24 25-44 45-54 55-64 15-64 15-64 15-64

EU15 (2001– 2011)

Intensity -0.24 0.19 0.79 1.12 1.86 -1.00 0.96

Quality 0.02 0.43 0.13 0.17 0.76 0.24 0.91

Demographics -0.16 -1.00 0.66 0.31 -0.19 -0.11 -0.31

All -0.39 -0.37 1.58 1.60 2.43 -0.87 1.56


-0.23 0.63 0.92 1.30 2.62 -0.76 1.87

Women Men Total

15-24 25-44 45-54 55-64 15-64 15-64 15-64

NMS12 (2001– 2011)

Intensity -0.69 -0.45 0.46 0.51 -0.17 0.59 0.68

Quality 0.07 0.72 0.14 0.10 1.03 0.31 1.15

Demographics -0.42 0.32 -0.78 0.64 -0.24 0.68 0.38

All -1.05 0.60 -0.18 1.24 0.61 1.59 2.20


-0.63 0.28 0.60 0.61 0.85 0.91 1.83

Potential sources of female employment developments



Country Age group

Major policy factors behind women’s employment intensity (+: success, -: failure, N – neutral, i.e. no evidence of any visible significance)

Estonia 15-24 - promoting tertiary education for women (+) - school-to-work transition programs (N)- formal / institutional pre-school child-care (+)- flexible approach to paternity benefits, increasing role of men in child-care (-)

Spain 25-44 -part-time and other forms of flexible contracts (+)-increasing level of education (+)-more equal share in parental responsibilities (N)-immigration that helps to resolve care responsibilities tension for the native women (+)

Poland 45- 54 - part-time and other forms of flexible contracts (-)- increasing level of education (+)-family / work reconciliation (-)

Germany 55-64 - increase in retirement age (+)- collective agreements on reducing the overall work time and introducing more flexible contracts (+)- active ageing programs and lifelong learning programs (N)

Summary

• In 1990s, employment rates in EU rose mainly among prime-aged women.

• In 2000s, significant improvements were observed among women aged 45+, especially in the EU15, whilst younger age groups (under 25) experienced noticeable decrease.

• Decomposition reveals that in both decades the intensity factor was the primary source of positive change.

• Rising qualification level of female population played a significant role as well. In 2000s, it was especially strong in the new member states because of tertiary education boom.

• So far demographic factor had no or little impact on total female employment rates.



Policy implications

• Falling employment rates of young women indicate that females postpone beginning of their job careers due to obstacles to balancing work and (tertiary) education.

• Older women experienced greatest improvements, but their employment rates are still significantly lower than those of prime-aged women. There is a noticeable room for future action, especially in Southern Europe and CEE countries.

• These actions should take into account potential country-specific impediments to further employment growth of women aged 50+.

• Flexible forms of employment constitute an important tool for increasing women’s participation, although they may lower women's wages, as discussed further later in this session.



Thank you for your attention.

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female's employment growth: the role of demography, employment intensity and human capital...

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