The growing role of women in the workforce

The growing role of women in the workforce arguably qualifies as the most consequential socio-economic development of the past 50 years.

Jock Finlayson

Troy Media

The growing role of women in the workforce arguably qualifies as the most consequential socio-economic development of the past 50 years.

As more women have entered the formal labour market, the productive capacity of our economy has been augmented. Indeed, increased “labour input” – more people working – has been the principal factor pushing up gross domestic product (GDP) and household incomes in Canada.

And women account for a large majority of this increase in “labour input.” A study done last year by the economics team at RBC estimated that the rise in female labour force participation since the early 1980s has boosted Canada’s GDP by more than $130 billion.

Women today comprise approximately 48 per cent of the labour force, up slightly from 46 per cent in 1999 but significantly higher than their 37 per cent share back in the mid-1970s. Men are still more likely to be employed, but the male/female labour force participation gap has narrowed over time. On current projections, more than half of all the jobs in Canada will soon be held by women.

Among women aged 15 and over, approximately six in 10 were employed in 2013; in 1976, the comparable figure was just 42 per cent. The predominant demographic trend of population aging that is starting to weigh on overall labour force participation is affecting both genders, so the proportion of all women holding jobs will edge lower as the country becomes greyer. But women’s contributions to Canada’s workforce and its economy should continue to grow over the next 10 to 20 years.

Where do women work? Statistics Canada’s 2011 National Household Survey reports that they are most likely to be employed in three broad occupational clusters: sales and service occupations (27.1 per cent), business, finance and administration (24.6 per cent) and education, law, and government/community services (16.8 per cent).

But despite gains in educational achievement, many working women hold relatively low-paying jobs. This exerts downward pressure on average compensation for female job-holders collectively; it also explains the residual male/female difference in average pay. A significant number of the 20 most common jobs for women fall in bottom third of all occupations ranked by hourly pay. There is still work to be done to ensure that women are better represented in the top half of occupations measured by total compensation.

The impressive advances that women are making on the education front bode well for their career and income prospects going forward. Since the early 1990s, women have made up a majority of college and university students. By 2012, a higher percentage of women aged 25 to 44 (75 per cent) than of men in the same age category (65 per cent) had completed a post-secondary education. This contrasts with the situation for older age cohorts: among Canadians aged 65 and over, 35 per cent of women and 46 per cent of men have a post-secondary credential.

The trend of rising female educational attainment is by now well-established. In both Canada and the U.S., women represent increasing shares of current university/college students and also of recent graduates in disciplines that often pave the way to relatively high-paying jobs – including law, medicine, dentistry, architecture, business and finance. They have registered smaller gains in engineering and computer-related fields, but here too women are making inroads. A large body of data shows that girls generally out-perform boys in elementary and secondary school, and this seems to be carrying over to the university and college level. In the language of economics, women are building up their “human capital” at a faster pace than men.

There are some areas of education and training where women still lag. One glaring example is the skilled trades. These are among the occupations that offer pathways to good jobs and the kind of middle-class standard of living that now seems to be out of reach for most young adults lacking any type of post-secondary qualification. According to Statistics Canada, women make up just 3 to 7 per cent of enrolments in registered apprenticeship training programs in the construction, electrical, industrial/mechanical, metal fabricating and motor vehicle and heavy equipment trades.

That’s not good enough. Employers, educators and unions need to do more to encourage young women to consider skilled trades occupations and to create a supportive environment for those who choose to follow this route.

Jock Finlayson is Executive Vice President of the Business Council of British Columbia.