Amidst all of the good news pouring out of today’s job market, one trend has gone relatively unnoticed: women are entering the workforce at a faster pace than men.
Growth in the employment rate for prime-age women (those between 25 and 54) broke away from that for prime-age men starting in late 2015, and women haven’t looked back since.
Trends in male and female employment rates usually track one another fairly closely, with a few notable exceptions. They moved in lockstep in the early 2000s, and again between 2012 and 2015, but diverged during the Great Recession, and are doing so again now.
One reason for the recession-era divergence is that the male-dominated industries of construction and financial services contracted the most during the recession. But there isn’t one simple story for why employment growth for women is so much stronger today.
ZipRecruiter data point to several important factors fueling the shift.
1. Labor Market Tightness
After several years of sustained job gains averaging around 200k new jobs per month, the labor market finally became tight enough to deliver nominal wage growth above 3% beginning in 2015. When employers began experiencing greater difficulty attracting and retaining workers, they not only raised wages but also sought to grow their talent pools, thus expanding their recruitment efforts and offering more attractive working conditions.
We’ve seen an increase in ZipRecruiter postings that mention reimbursement for training, work from home, flexible schedules, apprenticeships and on-the-job training. While better benefits and perks are attractive to everyone, these options are especially beneficial to stay-at-home parents and people who have experienced labor market interruptions–many of them, women.
2. Growth in the Service Sector
The bulk of recent job growth has taken place in service sector occupations, which tend to have a higher share of women. The healthcare industry, for example, has seen explosive growth over the past decade, accounting for more than a quarter of the net new jobs created between December 2007 and November 2018.
As of 2017, women comprised 90% of all Registered Nurses in the U.S., which was also the fastest growing occupation on ZipRecruiter in 2018.
3. Studying More, Having Children Later
Women have earned more bachelor’s degrees than men since 1982, and more doctoral degrees for the past nine years. Not only are women making more investments in their human capital, they are also delaying motherhood to focus on developing their careers. Women have therefore been in a good position to reap the benefits of a tight labor market.
Several studies have found that what people call the “motherhood penalty” is much smaller when women have children after age 35, after they have gained some seniority and attachment to the labor market. The shift towards women having children later is leading to women experiencing shorter labor force interruptions and being more financially prepared to balance the demands of childcare and careers. The result is that we are seeing a shift towards greater gender balance in previously male-dominated occupations.
Although the broad trends in women’s employment are encouraging, women still earn less than men on average and remain underrepresented in tech companies and in management. Employers have an important role to play in creating fair and nondiscriminatory workplaces, but women can also take steps to balance the scales.
At ZipRecruiter, we’ve found that women apply to fewer jobs, have lower salary expectations, and are less likely to negotiate for higher starting pay and pay raises. Given employers’ mounting hiring challenges and growing demand for workers across a wide range of industries, women are well-positioned to apply more widely, raise their expectations, and exercise their growing leverage at the negotiating table.