The Decline in Employment of Women

In January 2001, the month George W. Bush was inaugurated, 74.2% of women age 25 to 54 were employed.  Last month only 69% of women age 25 to 54 were employed.  This decline means that 3.4 million fewer women are working, during the most important years for career advancement, than if the employment to population ratios had remained stable over the past decade.

The past two recessions have caused substantial declines in the employment of women, reversing more than 40 years of increasing labor force participation and employment of women.  The following charts, based on data from the Current Population Survey, show that the employment of women under age 55 declined (relative to population) during the first 3.5 years of both the George W. Bush and Obama Administrations.

The decline in employment has been especially large for women age 20 to 24.  In early 2001 more than 69% of women age 20 to 24 were employed.  By the middle of 2012 only 59% of women in this age group were employed.

Only women age 55 and above experienced a significant increase in employment during the first 3.5 years of the G.W. Bush Administration.  However, over the past 3.5 years the employment of women age 55 and above has just kept pace with population growth.

The employment of women has declined relative to population over the last decade.  The past two recessions have reversed some of the gains in women’s employment between 1960 and 2000.  It is especially troubling that women’s employment has declined relative to population even during the past two years of a relatively weak economic recovery.

Women’s employment has declined by more than 5% in the 25 to 54 age group since 2001.  Workers in this age group are accumulating valuable experience and human capital that results in future earnings growth.  Workers with more gaps in their employment histories from age 25 to 54 are likely to experience slower earnings growth over their careers.  The consequence of fewer employment opportunities over the past decade for these women will be lower earnings for years to come.

56.5% of the Job Losses Since 2009 Occurred for Women

Last month the Romney campaign cited Bureau of Labor Statistics (BLS) data to report that 92% of all job losses since President Obama took office in January of 2009 were suffered by women.  The media reaction to the Romney campaign’s claim was mixed, but most analysts did not question the accuracy of the underlying data.  Some analysts opined that it was expected that most of the job losses in the past three years occurred for women because government employment has contracted slightly since January 2009.  My blog post from April showed that 95% of the jobs eliminated at the U.S. Postal Service were held by women.  The problem with all of these analyses is that they are based on faulty data.

The BLS announced on its website yesterday that:

Estimates of women employees in the U.S. Postal Service and some related series from the Current Employment Statistics survey were temporarily removed from the BLS data-retrieval system on May 14, 2012. BLS staff discovered data-processing errors that occurred during the November 2009–April 2012 period and resulted in an incorrect ratio of women employees to all employees. Correcting these errors will increase the number of women employees but does not affect total employment levels. Series of women employees were removed for the U.S. Postal Service, federal government, government, service-providing, and total nonfarm.

Although I am not sure about how the BLS discovered their error, I believe I have an explanation.  Alan Robinson of the Direct Communications Group (@CEP_Observer) didn’t believe the numbers in my April blog post (three weeks ago) about women’s job losses at the US Postal Service.  After I sent him the data I used and a link to the BLS website, Alan still didn’t believe the data.  His inquiries to the BLS caused their economists and statisticians to take a closer look at the data, which uncovered the apparent errors.

The BLS is assigned an incredibly difficult task, and generally produces extremely reliable and valuable data.  This time they made a mistake, and are working to correct the problem.  Until the establishment employment data for women are updated, our best information on the gender composition of job losses comes from the household survey, also administered by the BLS and the Census Bureau.  The household survey shows that the fraction of the adult population that was employed:

  • Declined from 66.2% to 64.3% for men, between January 2009 and April 2012
  • Declined from 55.3% to 53.0% for women, between January 2009 and April 2012

Women comprise about 52% of the working age (civilian) population.  The 2.3% decline in employment relative to population for women means that 2.89 million fewer women were employed in April 2012 than would have occurred if the employment to population ratio for women had remained steady since January 2009.  Similarly, there are 2.24 million fewer men employed in April 2012 than would have occurred if the employment to population ratio for men had remained constant since January 2009.

The calculations above indicate that the best estimate is that 56.5% of the relative employment declines since January 2009 were suffered by women.  Next month the BLS will post updated data on the gender composition of employment based on the establishment survey.  There are many reasons why the household and establishment survey data will look somewhat different, but it is likely that the revised establishment numbers will mirror the household data and show that the majority (but far less than 92%) of the jobs lost since January 2009 were jobs held by women.

Women, Job Losses, and the Postal Service (Warning this post was based on data that the BLS now considers inaccurate)

This post, originally dated April 24th, is subject to revision once the BLS corrects its data series on the employment of women. See my updated post.

Last year President Obama told NBC’s Ann Curry “a lot of businesses have learned to become a lot more efficient with a lot fewer workers.”  The President gave examples of airport kiosks and ATM machines as technological changes that lowered the demand for certain types of clerical and sales jobs.  The President could have added that many of these jobs were previously held by women and are unlikely to return even after the economy recovers.  That may be one reason why the unemployment rate for women has increased from 7.0% to 8.1%, while it has fallen by 0.3% for men since January 2009.

Although economics textbooks often describe technological change that replaces factory workers (and jobs traditionally held by men)  more recent advances in information technology have reduced the demand for some clerical and sales jobs traditionally held by women.   There may be no better example of this phenomenon than the United States Postal Service where more than one in three women lost their jobs in the past three years.  The number of USPS employees has fallen by 116,500 (15.6%) in the past three years.  Nearly all (more than 96%) of the job losses have been due to a decrease in the number of jobs held by women.  The following chart illustrates the average employment by gender and calendar year, for the past five years, at the USPS.

Women’s employment declined by 112,300 while men’s employment dropped by 4,200 from 2008 to 2011.

The next chart illustrates the fraction of USPS jobs held by women in each of the last five calendar years.

The fraction of USPS jobs held by women peaked in 2007 but has now fallen below one third for the first time since 1980.

The information technology revolution, and the recession, did not just lower demand for post office employees; over the past three years employment at bookstores fell by more than 30% and in the courier and messenger industry by almost 9%.

The dramatic change at the United States Postal Service since 2009 is but one example of how advances in information technology can permanently reduce the demand for some clerical and sales positions traditionally held by women.  Although polls indicate that President Obama enjoys a comfortable lead over Mitt Romney among women that may well depend on what happens to the gender gap in job creation between now and November.  As more Americans use the internet to communicate, shop, gather information, and find entertainment it is likely that employment will continue to decline at many retailers and service providers even if the economy strengthens.

Facts about Women’s Job Losses

The Romney Presidential campaign has correctly observed that men’s job losses tended to occur earlier in the 2008-2009 recession while women have lost more jobs than men since January 2009. The employment of women in the private sector fell by about 252,000 from January/February 2009 to January/February 2012 (BLS establishment survey). There are, however, substantial differences in the magnitude of job losses and gains by industry. For example, women’s employment in the health care industry increased by almost one half million and by 224,000 in temporary help agencies. In all other private sector industries women’s employment fell by 975,000 over the past three years.

Private Sector Job Losses Highest in Retail Trade

The following table presents information on selected private sector industries where women’s employment has fallen disproportionately over the past three years.

Selected Private Sector Industries with Substantial Declines in Women’s Employment January/February 2009 to January/February 2012

Industry

Employment Change

% Change in Employment

Retail Trade

-260,000

-3.51%

Telecommunications

-87,000

-23.1%

Publishing

-56,000

-14.5%

Real Estate

-48,000

-6.45%

Apparel Manufacturing

-22,000

-18.1%

Air Transportation

-16,000

-8.76%

Some of the jobs lost by women in the past three years, such as those in real estate, retail trade and air transportation are likely to return as the economy recovers. The steep percentage declines in employment in industries adversely affected by international trade and technological change are less likely to be reversed in an economic recovery.

Going Postal

The BLS data also indicates that women’s employment in the public sector declined by about 448,000 over the past three years. The following table shows that while there were small declines in state government and a modest increase in most of the federal sector, women’s employment at the U.S. Postal Service dropped sharply, by almost 35%, in just three years. Over 96% of the jobs lost at the USPS were held by women; while almost 35% of all women at the USPS lost their jobs the employment of men fell by less than 1% in the past three years.

Declines in Women’s Employment in the Public Sector

January/February 2009 to January/February 2012

Industry

Employment Change

% Change in Employment

U.S. Postal Service

-109,000

-34.9%

All Other Federal Government

+51,000

+5.46%

State Government

-12,000

-0.43%

Local Government Education

-204,000

-3.33%

Other Local Government

-174,000

-5.68%

Much of the decline in public sector employment has been at the local government level. Women’s employment in public education fell by about 204,000 over three years, but this was a smaller percentage decline than in the rest of local government.

Conclusion

Women have lost more jobs than men over the past three years despite the fact that almost 80% of health care workers are women and almost half a million health care jobs for women were added over the past three years. Women have lost over 200,000 jobs in public education, but job cuts in local government have been larger (in percentage terms) outside of education where the majority of workers are men. In the past three years women have lost jobs disproportionately in retail trade, where men’s employment increased by a quarter million, and in telecommunications, publishing and real estate. The biggest gender gap in job losses, by far, is at the U.S. Postal Service where over 96% of job losses were suffered by women.

Technical Note: Employment figures compare the average of seasonally unadjusted data in January and February 2012 to the corresponding average in January and February of 2009.

Follow

Get every new post delivered to your Inbox.

Join 1,230 other followers

%d bloggers like this: