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Kiwibank economist Mary Jo Vergara with a detailed crunch of some of the facts and figures and ongoing trends portraying the increasing role of women in the economy

Kiwibank economist Mary Jo Vergara with a detailed crunch of some of the facts and figures and ongoing trends portraying the increasing role of women in the economy

Today's Top 5 is a guest post from Mary Jo Vergara, economist at Kiwibank.

As always, we welcome your additions in the comments below or via email to david.chaston@interest.co.nz.

And if you're interested in contributing the occasional Top 10 yourself, contact gareth.vaughan@interest.co.nz.

See all previous Top 5s here.

Substantial gains in education. Greater labour market participation. Rising incomes. Women’s economic status has unequivocally improved since the 1970s. Of course, we could debate on how ‘economic status’ should be measured (and I’m sure some of you will in the comments below). But the reality is, we live in a market economy governed by these three pillars. Besides, the last half century proves that women can thrive in this environment.

There’s no denying it. The female presence in the New Zealand economy is growing. And there’s no stopping it. In 1971, the female labour force participation rate was 39%. Fast forward five decades and two thirds of working age women (65.6%) are active in the labour force.

Much has happened since the 1970s. And not just the fashion. Thankfully.

Preferences have changed, and young women are leading the charge. Our grandmothers would be proud.

Here are the top 5 trends in women’s economic involvement.

1. Rebel without a cause.

Any parent would agree, teenagers are an angsty bunch. Young people generally don’t do well with authority and are constantly working to beat the system. But unlike James Dean, young girls are rebels with a cause.

In the days of greased lightning, the number one destination for young women leaving school was for clerical-and sales-type employment. With time, the pendulum has swung. Today, more women pursue higher education. The first chart shows a welcome rise in the employment rate of young women. The second chart shows the rise in tertiary enrolments. Admittedly, institutions have helped. In 1991, science, maths and technology were made compulsory in secondary school – subjects in which females have traditionally been absent. The exposure to a wider range of subjects encouraged more young women into advanced study, and broadened their employment options.

Female participation in education may have skyrocketed, but the pigeonholing of students is still evident. Young girls are generally presented with more ‘female-friendly’ opportunities. They’re told they’ll make great caregivers, nurses and teachers. To be a Silver Fern is the be-all and end-all. Young boys are given the same treatment. They’re seen as better tradies, pilots and engineers; they dream of their name across the back of an All Black jersey. But what it means to ‘run like a girl’ is changing.  And young girls are running fast. We need to ensure they don’t lose momentum.

2. Converging occupations and smashing the glass ceiling.

For most (abstracting from the ‘Branson’s, ‘Gates’s, and ‘Chanel’s of the world), education precedes occupation. And the field of study is chosen with intent.

Case in point – the entry of women into traditionally male-dominated occupations follows the entry of women into traditionally male-dominated disciplines. For example, the rapid rise of the female scientist links back to compulsory study in school. The same goes for law, medicine and commerce. Men were once the incumbents, but women have swarmed onto the scene. We cannot prove the link between ‘Legally Blonde’ and law school enrolments, but surely there is one. Come to think about it, ‘A Beautiful Mind’ was influential in my decision to pursue economics. (But after seeing the ‘Wolf of Wall Street’, I’m beginning to have second thoughts.)

It’s also more common today to see women on the boardroom invite list. In 2008, women held 8.7% of directorships among NZ’s top 100 listed companies. A decade later, women constitute 24.1% (we can’t find the percentage for the 1970s-80s as it was a rounding error). The rising popularity of postgraduate study has boosted women to higher rungs on the career ladder. But we shouldn’t pop champagne just yet. 24.1% tells us that there’s room for a plus-one. The proportion of women in more senior roles may be rising, but the climb is proving to be a hike. And we’re moving at a snail’s pace. 

3. Delayed motherhood.

In the 70s and 80s, male and female employment rates were closest in the youngest age groups, but diverged thereafter. The age-old narrative continues today. Family formation was, and remains, highly influential on a woman’s employment status. But the recent shallowing out of the dip suggests a new trend: delayed motherhood. And it’s gone viral. More women are postponing having children to their mid- to late-30s.

Along with ‘staches, bell-bottoms and discos, the 1970s saw the rise of the women’s liberation movement. The 19th century ideology that largely dictated the extent of women’s involvement in the economy quickly became antiquated. Women challenged the notion that their economic value was inextricably linked to their ability to bear children. It was seen as important for women to finish their education, step outside the secondary sector, and establish a career. Unfortunately, there’s no such thing as a free lunch. And an ageing population is the (unwanted) side order of fries.

It’s also more common today for women to return to work following childbirth. And earlier than previously observed. In 1987, the Parental Leave and Employment Protection Act extended parental leave to fathers. The new law supported the changing roles of men and women within and beyond the home. The ability to share childcare between parents makes it easier for women to confidently return to work.

4. “Second shifts” and sticky floors.

As you might expect, just as male and female employment rates diverge during peak-working ages, so do male and female earnings.

Previously, women’s earnings peaked twice – once at the ages of 25-29 and again at 45-49 years, but never returning to the first peak. Along with forehead wrinkles, bad backs and (I bet) a trillion other things, we blame the little rascals for the valley in between. But the recent gains in education and emerging labour market trends have manifested in a rise and extension of women’s earnings. According to the chart above, women’s earnings continues to increase past the age of 29 and smooths to a single peak at 50-54 years.

Though the gap between male and female employment/earnings has narrowed over time, it still exists. And it conceals further issues. Part-time employment is considerably higher among women than men, and has been for decades. There is no doubt that balancing paid and unpaid domestic work presents several difficulties. And women seem to be the stars of this balancing act. The 2009-10 NZ Time Use Survey revealed that women spent more than twice the time men spent on childcare each day. A “second shift” it’s called. For women trying to balance work and family commitments, flexible and part-time working arrangements are attractive options. And oftentimes, the only option.

The problem: part-time employment is generally low-paid, only available in a limited number of occupations, and career-limiting. The consequence: maintained financial dependence on their partner and/or the government.

We need to find ways to share the stage. There are prohibitive stereotypes on both sides. For women, it’s expected. For men, it’s often frowned upon to take on a caregiver role, and not be the breadwinner (or be the ‘wife’) in the relationship.

5. “And I’m Telling You I’m Not Going” – Jennifer Hudson (Dreamgirls).

We’re also witnessing greater labour market involvement by NZ’s-own golden girls. The generation of women who entered the labour market in the 70s and 80s have superseded their predecessors. The abolishment of a compulsory retirement age in 1999 encouraged women to postpone retirement and remain in paid employment. And it seems that their cocktail glasses have been filled at the fountain of youth. Increased life expectancy, particularly among women, has been another labour market helping hand.

From flared jeans to frayed jeans. ‘Fros to bobs. ABBA to Adele. Much has changed. Women’s experience in the NZ economy is no different. Since the 70s, women’s economic status has reached new heights. We’ve learnt, we’ve grown, and we look back fondly.

But 50 years on, momentum has slowed. It’s taking a while for the remaining headwinds to clear. Last Friday, the NZ Herald published the new salaries of the country’s top CEOs. Can you spot the female(s) in the image above? Hint: it’s not a stereogram, there’s no need to squint. It shouldn’t be this hard. Jayne Hrdlicka shouldn’t be the only woman on there. And female tokenism shouldn’t be clickbait (Hrdlicka wasn’t even mentioned in the article).

But the destination our grandmothers envisaged remains in sight – a NZ where young Kiwis are free to choose between the pink (red) pill and the blue pill, regardless of what those before them chose, and without fears of falling off the career ladder.

Hopefully, it won’t take us another 50 years to get there. Look out for a Top 5 of the possible shortcuts we can take. 

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19 Comments

Unintended consequences. The drive to secure economic freedom has seen women deny their daughers and grand daughters of the opportuity to have families when they are young.

There is considerably improved choice for women. However many people do not want to have children as they cannot afford them. Working to survive, and working long hours just to survive does not create an environment that will leads to families or larger families.

No point blaming women for the mispricing of assets, money, increased living costs and risky financial instruments with very little return.

That is more likely to be down to people (read women) being lectured not to have children till they can afford them.
Why do you think women sought economic freedom in the first place?
Anyway, a smaller population is what the world needs so it has probably all come at a very good time.

The assumption throughout this is that an increasing proportion of women want to be (should want to be?) in the work force. Leaving aside the proportion of women genuinely career-driven or ambitious to be at a boardroom table, it is worth considering the financial necessity of employment - often any employment - for increasing numbers of women with working partners and/or families. The growing number of child-care options aren't there because they're 'a good thing' - they're there to meet pressing parental needs.

Good story, Mary Jo, and a great one for women working. In the last 100 years women have come a long way in our western societies - from the vote to the view from the boardroom. This is not quite the same story when you head outside the western cultures, but that's a story for another day. I would add that research coming out of North America not only confirms what you are saying but also tells the other half of this story - about the men. The men are declining in almost all stats of education (as you could work out from the graphs above). Men are failing in huge numbers as evidenced by the huge & increasing incarceration rates, which just keep getting worse, with some reports implying that the traditional male archetype role-model has changed beyond recognition in many cases, leaving many men confused as to their worth/role in family & society.
It's fine to say men should step up & do their share of parenting but many men are not built to change nappies, they're built to work (hunt & gather)- a role they've had for thousands of years. And lets not forget, men where also built to fight & defend the realm, another role they've dominated for thousands of years, with mass grave sites across the globe a testament to the power struggles & slaughters. I'm not saying women working longer for better reward is a bad thing, what I'm suggesting is that we need to get the men up to speed or motivated or re-skilled or thinking differently so they too can have a good/great self-esteem as "we all'' head into the new millennium, as well.

There was once in Esquire a cartoon depicting an executive meeting of men, all but one, and the chair of the meeting says something like “that is an excellent suggestion and solution Miss Jones, now would one of the men table it please.” Has always astonished me how corporate management would sooner suppress good policy and decisions, rather than have it come from what is perceived as “the wrong quarter.”

Most young women that I know have given up ever wanting to have children not because they're particularly career focused. They just see that the way things are going in NZ they're unlikely to ever own a home here even with a husband/partner. There's simply too much pressure on the cost of living here and god help them if they pushed in to the poverty trap by being a single parent. Also why should women be pushed in to stay at home to rise kids anyway, that's just a waste of skills and talent. BBC School league tables: Boys behind girls for three decades. https://www.bbc.com/news/education-51313438

Men are still by an enormous margin more likely to die in work-related accidents than females. Last year 96% of work-place deaths in NZ were male (small sample I expect) while in the USA it was 4837 male to 413 female deaths (https://www.statista.com/statistics/187127/number-of-occupational-injury...). It's a crude proxy, but at a cursory level if men are undertaking riskier occupations, wouldn't that be one explanation of a systemic gender pay gap?

A wee bit too rah, rah for me.

I think the statistics have less to do with 'women's emancipation' (i.e., freedom of choice) and more to do with women's co-optation in to the dominant economic narrative by necessity (i.e., the need for two-partner working families).

I know it's long, but again the economic analysis put forward by Elizabeth Warren when at Harvard tells a fuller statistical story;

https://www.youtube.com/watch?v=akVL7QY0S8A

I think you are right on the money. P

Commodification of child rearing. Grossly inflated housing costs. Is this truly a better society? Bring back a child benefit system. Ascribe a real economic value to parenting.

Yes, it is a rather perverse society that applies a government subsidy to non-parental childcare, but grants no subsidy to parental childcare.

Nuts.

https://www.workandincome.govt.nz/products/a-z-benefits/childcare-subsid...

How so? Non-parental child-care means both parents have returned to work and paying tax, so even with subsidy it will be accretive to the Govt. accounts and GDP. Parental childcare means only one parent is paying tax.

Getting more females into the workforce is good for the tax-base and GDP.

Watch this and then let me know you think;

https://www.youtube.com/watch?v=akVL7QY0S8A

What's important is what's good for families.

I really don't have the time to watch Warren. If it's about what's best for families, i'd lean towards the traditional family unit. I'm really agnostic - if women want to pursue corporate careers and all the baggage that comes with that, more power to them/you.

What she points out using statistical data is why the traditional family unit, with a single income and one partner at home, is no longer viable financially. And that this 'forced' change (to two-income households as the norm) occurred within a child-rearing generation (a period of two decades).

Correct, yet many measures of essentials in our society are based around the idea of a 'household' income without realising how many hours are going into producing that household income; i.e. is it 40 or 80? This is an essential part of the puzzle for Kiwis who face a triumvirate of high living costs, low wages and long hours, usually on salaries with little room for paid overtime. We have a very poor statistical grasp on what it actually costs to run a household in terms of time and labour and it renders our notion of 'affordability' null and void.

Good riddance to the days when a women had to spend her time looking for a good husband, or catching up om the news with friends. In current year women are free to pursue exciting careers in engineering and coding.

Lets face it , we have a manpower shortage , and women have increased opportunities to enter the productive economy as a direct result .

We see this usually in wartime , when there is a severe manpower shortage , New Zealand women milked the cows , while the men went to war , American girls worked in armaments factories , and British girls ( Including the Queen ) drove ambulances and stores vehicles .

Furthermore , women elsewhere DO NOT enjoy the freedoms that New Zealand women enjoy ............

I have spent time in Africa and elsewhere where women are treated in the most appalling manner by many of those societies , they carry immense burdens with little or no reward

Days to the General Election: 24
See Party Policies here. Party Lists here.