Image: Contributed
Continuing our series in honour of International Women’s Day, Okanagan Edge presents the latest in a series of blogs examining the place of British Columbian women in the workplace.
Penned by authors at the Business Council of B.C., the six-part series explores issues such as the gender pay gap; women’s labour force participation; the link between education, child care, and missed opportunities; and women’s entrepreneurship and self-employment.
Last week, authors Denise Mullen and Kristine St-Laurent explored the gender gap and why it matters. In part two of the series, they dig into labour force participation and why there’s been a stable gender gap since the early 1990s.
Part 2: The Participation Rate
Image: Statistics Canada
The term “labour force participation” has a specific meaning. It includes both full-time and part-time workers, as well as those who are not currently working but are looking for a job. All of these individuals are participating “in” the labour market.
Full-time students and retirees, stay-at-home parents and people with disabilities who are not actively engaged in looking for work are considered to be “out” of the labour force. So are other individuals who have stopped looking for a job for one reason or another.
In terms of women’s labour force participation, a woman on maternity leave is still considered in the labour force if a return to her job is anticipated and/or her position is protected (regardless of whether her leave is paid or not).
If she formally quits her job to take care of a child or other dependent, she is no longer in the labour force.
Sometimes, labour force participation rates can fall for demographic reasons, such as a rising share of retirees exiting the workforce or a significant increase in the population of students enrolled in post-secondary education. But there is cause for concern when labour force participation rates fluctuate for what Statistics Canada refers to as “prime-age” workers—those between 25 and 54 years.
Such variations can have wider economic consequences.
Lower labour force participation may lead to slower economic growth, sluggish productivity, reduced consumption, and fewer public tax dollars to pay for social services, health, infrastructure and other types of government spending.
In terms of human capital, long breaks from the labour force make it more likely that a person’s skills will depreciate or, at the very least, that their skills don’t fit with what employers may be looking for.
For individuals with prolonged periods of absence from employment, returning to work can mean more precarious and lower-paid work, fewer employer-paid benefits, and less seniority.
BC Context: Who’s In, Who’s Out?
Image: Statistics Canada
Participation rate statistics for British Columbia start in 1976. The slope of the trend lines and the rates of change mirror overall national trends in Canada. As of 2016, total labour force participation rates for women and men over 15 were 60% and 69%, respectively.
The key takeaway from this chart starts around the early 1990s. Since then, women’s participation rates have remained constant, and there has been a stable gender gap.
Why is this so? It’s a bit of puzzle.
Women and men enter the labour market in almost equal proportions, but there is a drop-off rate for women in their prime working years.
At the beginning, young women between the ages of 15 and 19 may participate even more than men do in paid work, as indeed they did in 2016.
The drop-off begins in the 20 to 24-year age group and reaches a peak between 35 and 49 years.
The gap is only partially explainable by child rearing (which will be discussed in an upcoming blog). It is not because of a lack of education, skills, or ambition; rather, the explanation may lie in policy and organizational human resource practices.
Reasons for labour force non-participation matter. The consequence of fewer women working is not just a women’s issue; it is an economic issue. A decline in the number of labour force participants–particularly of an increasingly better-educated cohort–acts as a brake on the provincial economy.
We need to do more to understand the reasons why some women choose to opt out of work. Only then will we be in a position to devise strategies to fully tap into and apply the talents of the women who make up over half of British Columbia’s population and potential workforce.
The Business Council of British Columbia aims to produce timely and exceptional public-policy research and advice on issues to enhance B.C.’s competitiveness and prosperity. As a collaborative, non-partisan organization, the council strives to be a venue where members, policy experts, elected officials, and government decision-makers can address problems and form solutions together.
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