This Economic Report looks at changes to women's employment since the turn of the century, paying special attention to what has happened since the recession.
In January 2000, the employment rate for women stood at 65.5 per cent; in May 2012, it was almost identical: 65.8 per cent. The most important change in the intervening period was a large growth in the number of adult women: the number of women aged 16 - 64 grew by 1,391,000. Women's employment level was therefore more than a million higher, having risen from 12,485,000 to 13,637,000.
There had been a similar increase in the number of working age men, and in the number of men in employment. A point of difference was the impact of the recession; in the latest figures male employment was 138,000 below the April 2008 peak, women's employment in the latest figures is 41,000 higher. Men's employment rate slipped from 79.0 per cent in April 2008 to 76.3 per cent in May 2012. It is important to note, however, that this is still significantly higher than women's 65.8 per cent rate.
In January 2000, there were 689,000 unemployed women and women's unemployment rate was 5.2 per cent. By May 2012, the female unemployment level had risen by two-thirds, to 1,099,000 and the rate by nearly half, to 7.5 per cent. Women's unemployment had been over one million for 24 successive months and women account for over 100 per cent of the increase in unemployment over the last two years:
Table 1: change in unemployment levels (000s)
In the most recent data, 324,000 women had been unemployed for over a year. In July 2011, this figure went over 300,000 for the first time since 1993 and it has not fallen below that level since. Although there are still more men who have been unemployed for that long, the ratio of male long-term unemployment to female has been falling since the last century and this trend has, if anything, accelerated in the past five years. Women's chances of becoming long-term unemployed are still lower than men's, but women's likelihood of being in this position is increasing:
The recession played out differently for men and women; employment fell and unemployment rose for both, but neither was a mirror image of the other:
Initially, the effect on men, especially on employment rates was more noticeable. Women's employment rate levelled off before men's, but women have not yet seen anything similar to the improvement in men's employment rate that began in August 2011. The recession drove men's unemployment rate higher than women's, but while men's unemployment rate levelled off in 2010, women's continued to rise, though at a slower rate. Men have seen a faster fall in unemployment since the autumn of 2011 and the gap between current rates and the pre-recession trough is similar for both.
Although unemployment has risen and employment has fallen, the labour market has performed better than might have been expected, given the loss of output in the recession and the stagnation since 2010. It is often noted that self-employment has played a significant role: since the peak in April 2008, while the number of people in employee jobs has fallen by 483,000, the number in self-employment has risen by 366,000, the main reason the net fall in employment is below 100,000.
What is less frequently commented on is the significance of women's self-employment. Women currently account for 29 per cent of self-employed workers - but 54 per cent of the increase since April 2008.
The rise in self-employment is a long-term trend and women's self-employment has been growing faster than men's for at least a decade, averaging an annual growth rate of 2.7 per cent since 2000, compared with 1.8 per cent for men. What is notable is that, while employee employment took a blow from the recession from which it has still to recover, self-employment hardly paused:
Unions have long feared that much self-employment is false; false self-employment saves employers the cost of NI Contributions and other responsibilities and costs workers lost rights to benefits, pensions, paid holidays and sick pay. David Blanchflower has pointed out that 'the typical self-employed person earns much less than the typical employee'. Data from the HMRC Survey of Personal Incomes reveals that, between 2000 and 2010, the median income of people in self-employment fell in nominal terms: from £11,300 in 2000/1 to £10,300 in 2009/10. During the same period, the median income of employees rose from £14,600 to £18,900.
The Department for Work and Pensions' Households Below Average Incomes report reveals that self-employed working age adults are significantly more likely to be poor than other working families:
Table 2: proportion working age adults in poverty by economic status of adults in the family, 2010/11 (%)
The growing number of women in self-employment is unlikely to indicate an improvement in women's prospects.
The other factor underlying the lower than expected fall in employment is the growth of part-time employment. Since April 2008, total employment has fallen by 96,000, made up of a 672,000 fall in full-time employment and a 576,000 increase in part-time employment:
Table 3: full-time and part-time work
There has been a 776,000 fall in the number of people in full-time employee employment; 572,000 men and 204,000 women.
One plausible explanation for this is that unemployed people who have been unable to find jobs have been taking part-time jobs or accepted a reduction in hours to remain in or obtain employment and that men have been more likely to do this than women. The increase since April 2008 in the number of part-time workers who say they are working part-time because they could not get full-time jobs (752,000) is bigger than the total increase in part-time employment (561,000). Furthermore, the proportion of men in part-time work who would prefer full-time jobs has always been higher than the proportion of women part-time workers in this position:
Two other features of this chart are striking. The proportion of women part-time workers who would prefer full-time jobs is also rising. It passed 13 per cent in November 2011 for the first time; before the recession, it had not been above 8 per cent since the current statistics began in 1992. Possibly even more important is the difference between the figures for men and women - whereas the proportion of men in involuntary part-time work rose suddenly once the recession began, the figure for women has been rising since 2004. Youth unemployment also began to rise that year - the increase in women's involuntary part-time work may be because workers with less labour market power have found it more difficult to get jobs.
These figures may under-state the number of women whose part-time status is not what they would prefer. There has for some time been evidence that women with children are less likely to say that they would prefer full-time work; while at one level, this reflects their choice, it also reflects the availability of childcare and other structural factors that constrain their options. In addition, the number and proportion of women part-time workers who say they did not want a full-time job have been coming down for some time:
This trend has not been much commented on, possibly because women part-time workers who do not want full-time jobs still far outnumber those who do. Nonetheless, there are good reasons for women to resist part-time work; for one thing, a great deal of research has found that taking part-time work is linked to downward occupational mobility. For another, part-time work makes a significant contribution to the gender pay gap - 43 per cent of women workers are in part-time work, compared to 13 per cent of men and the low pay of part-time workers therefore makes a large difference to women's overall median earnings:
Table 4: median hourly earnings, excluding overtime, full-time and part-time workers, April 2011 (£ p.h.)
TUC research has extended the analysis to cover all underemployment by also looking at the number of people who want to work more hours in their current job, whether or not they want to work full-time. Using this definition, there are 1.7 million under-employed women workers, 52 per cent of all under-employed workers. Since 2008, the number of underemployed women workers has risen by 495,000.
The Commission on Vulnerable Workers estimated that 'around two million workers are trapped in a continual round of low-paid and insecure work where mistreatment is the norm' and that 'women, people from black and ethnic minority groups and disabled people' are more likely to be in vulnerable employment. It noted that women faced lower pay and were more likely to have experienced unfair treatment than men (7.3 per cent compared to 6.6 per cent). They were more likely to be at risk of persistent low pay, were less likely than men to be aware of their employment rights and much less likely to take a complaint to a tribunal. Around 25 per cent of vulnerable workers worked in establishments with a union but were not union members - and 60 per cent of the workers in this position were women.
'Zero hours contracts' are a form of employment in which the employer guarantees no set hours, but the employee has to be available for work whenever the employer notifies them. An analysis by Ian Brinkley noted that 56 per cent of zero hours workers are women. This is still an uncommon form of contract (even though it has been widely discussed for more than twenty years), accounting for 160,000 people (0.6 per cent of workers), though some of the 440,000 people classified as 'on-call' workers may also be on zero hours contracts. There were 140,000 zero hours workers in 2007, which might suggest that the numbers are rising, though the author notes that a 20,000 increase is within the statistical margin of error. He reports that zero hours is most common in entertainment, accommodation and food services and healthcare, and unions have reported a growing incidence in further education. However limited the number of these contracts reported in the statistics, they are a real concern and cause workers extreme insecurity.
The relatively good recent labour market performance is also, but to a lesser degree, explained by an increase in temporary employment - up 11.3 per cent since April 2008. The number of men and women in temporary employment fell steadily in the opening years of the 21st century; this trend reversed after the recession, but the turnaround was less noticeable for women than for men:
The impact of the recession on women and temporary work is much more clearly seen in the proportion of temporary workers who could not get permanent jobs. For both men and women this figure clearly started rising soon after the recession began:
Indeed, for both men and women, the increase in involuntary temporary employment is substantially larger than the increase in the overall number of temporary workers:
Table 5: men and women working in temporary work
Labour market statistics divide everyone into two groups. The 'economically active' are employed and unemployed people and the 'economically inactive' are people who are not in employment but do not count as unemployed because they have not looked for work in the last four weeks and cannot start work at two weeks' notice.
Table 6: economic status, working age (16 - 64); 2008, 2012 (000s)
For both men and women the change in the total population equals the sum of the changes in the next three columns. Between 2008 and 2012 the number of women aged 16 - 64 rose by nearly 300,000; the number unemployed rose even more - by more than 400,000, but the number in employment or economic inactivity fell. In the same way, the number of working age men rose by a third of a million but the number unemployed or inactive by over 600,000, offset by a fall of more than quarter of a million in employment.
Both men and women have seen large increases in unemployment, but where men have seen an increase in inactivity, women have seen a much
smaller fall in employment. The DWP has hailed 'women ... entering the labour market having previously been inactive' but the reality is likely to be more prosaic: it is an effect of the raising of women's pension age.
To understand this, we need to look at the figures in more detail. The Labour Force Survey asks economically inactive people for their reasons for inactivity and classifies them as students, looking after family or home, temporary or long-term sick, 'discouraged' (those who want a job but don't believe that any are available), retired and 'other'.
The tables below show changes in the numbers of working age men and women in these categories between 2000 and 2008 and between 2008 and 2012:
Table 7a: economic inactivity by reason, working age (16 - 64); 2000, 2008 and 2012 (000s)
Table 7b: economic inactivity by reason, changes
The biggest change here is the large increase in the number of students; this is nearly identical for men and women and continued after the recession. The other big change is the large fall in the number of women looking after family or home (and small increase in the number of men in this category) which accounts for two-thirds of the difference in the totals for men and women - long-term trend, reflecting the changes in women's social and economic roles.
Some readers may be surprised by the fall in the number of sick people, given the many media stories about 'benefit scroungers'. There is a difference here between men and women, with the number of women classified as long-term sick falling before the recession and rising afterwards and that may be related to our final point about this table.
Before the recession there was a small increase in the number of working age people choosing to classify themselves as 'retired' and after the recession this trend accelerated for men. This is
not surprising; in a tough labour market, one might expect that unemployed people who can afford to retire early will be more likely to do so. This makes the change in women's behaviour all the more remarkable. We can probably discount the idea that this is because of successful benefits policy or effective employment programmes: it would be very hard to explain why women were affected but not men.
These tables relate to figures for adults aged 16 - 64. In labour market discussions this is often referred to as 'working age' because, for men it is. But not for women, whose state retirement age is currently 61 and is gradually being raised to 65 in a process that began in the summer of 2010. These figures cover men of working age and women, mainly of working age, but also a shrinking group of women over retirement age. Over the coming years, every two months women's retirement age will go up and a new group who would previously have regarded themselves as due to retire will now stay in employment or, if they are not in employment will classify themselves as unemployed or long-term sick. This change is the most likely explanation for this trend.
Women account for two thirds of public sector workers, including three quarters of local government and NHS workers, four fifths of those working in adult social care; 70.4 per cent of jobs in education in Britain are held by women.
Cuts in public sector employment have already begun. Public sector employment peaked in the 4th quarter of 2009; by the first quarter of 2012 (the most recent figures) the public sector headcount had shrunk by 7 per cent (455,000). Public administration, the NHS and education, traditionally important women's employers are hardest hit:
Table 8: public sector job losses by industry (000s)
An analysis by sector shows that local government, another stronghold of women's employment, has also been hit hard by the early cuts:
Table 9: public sector job losses by sector (000s)
A survey by the GMB in October 2011 found that headcount employment in local government was 129,051 lower in the second quarter of 2011 than in the first quarter of 2010. Women's headcount employment was down 85,710 - 66.4 per cent of the total.
There are more job cuts to come. The Office for Budget Responsibility expects 730,000 between 2011 and 2017, with half a million taking place after the cuts in the tables above:
Table 10: general government employment (millions)
Work by the Institute for Fiscal Studies and the Resolution Foundation has shown that the growth in women's employment has been essential to the general growth in living standards over the past 40 years, so the impact of public sector job cuts on women's employment is likely to have significant implications for overall prosperity.
Some facts about how the labour market has been evolving for men and women are not widely appreciated.
It is true that the recession, in its early stages, hit men harder than women. But it is less frequently recognised that in the last two years this position has reversed, and women's unemployment has continued rising, while men's has fallen.
Many commentators have noticed that self-employment accounts for much of the improvement in employment in recent months. Fewer recognise the role of women's self-employment, with women accounting for less than a third of self-employment but over half the increase since 2008.
Since the start of the recession, part-time employment has grown, with significantly more men in part-time jobs, fuelling a rise in involuntary part-time work. But the proportion of women in part-time jobs who would prefer full-time is also rising - continuing a trend that began in 2004.
Women's economic inactivity has been falling, but the main reason for this is the raising of women's pension age. There is also a long-term reduction in the number of women who are economically inactive because they are looking after their family or home.
Public sector cuts will almost certainly hit women's employment hard, there is evidence that this is already happening in local government.
This report relies (except where stated otherwise) on data from the Labour Force Survey, obtained from www.statistics.gov.uk Most LFS data are for three month running quarters; the most recent, for instance, are for April - June 2012. For the sake of brevity, we will refer to each quarter by its middle month.
There have also been changes in the two minor classes of employment - a 5,000 fall in the number of unpaid family workers and 26,000 increase in the number on government schemes.
See, for instance, https://www.ucatt.org.uk/page.php?id=36
Blog post, 22 August 2012, http://www.newstatesman.com/economics/economics/2012/08/perhaps-iain-duncan-smith-will-accuse-me-peeing-data
Poverty = income below 60 per cent of equivalised median after housing costs. http://statistics.dwp.gov.uk/asd/hbai/hbai2011/index.php?page=chapters DWP, June 2012.
Note that this figure differs from the figure in table 2, because the LFS data for part-time workers' reasons for working part-time are slightly different from those for part-time workers in the categorisation of different types of employment.
Discussed, for instance, in 'Involuntary part-time workers in Britain: evidence from the labour force survey', Surhan Cam, Industrial Relations Journal, 43:3, 242 - 259, 2012.
See, for instance, the discussion in 'The effects of part-time work on women's occupational mobility in Britain: Evidence from the 1958 Birth Cohort Study', Shirley Dex and Erzsebet Bukodi, GeNet Working Paper No 37, 2010, http://www.genet.ac.uk/workpapers/GeNet2010p37.pdf
 'Statistical Bulletin: 2011 Annual Survey of Hours and Earnings (SOC 2000)', ONS, 2011, http://www.ons.gov.uk/ons/dcp171778_241497.pdf
Under-employment Crisis, TUC, 2012, http://www.tuc.org.uk/tucfiles/367/Underemployment%20report.pdf
Blog post, 17 August, 2012, http://www.theworkfoundation.com/blog/872/Zeros-hours-contracts-and-the-flexible-labour-market
See, for instance, www.ucu.org.uk/media/docs/3/m/he_advice__ft__hp.doc
LFS figures on temporary employment need to be treated with some caution as it seems likely that they under-count the number of temporary agency workers. The figures in this section are still useful in indicating trends in the labour market, but it would be sensible not to compare the numbers in temporary employment with the numbers in other forms of work.
DWP press release, 14-3-12, at http://www.dwp.gov.uk/newsroom/press-releases/2012/mar-2012/dwp025-12.shtml
'Job cuts in the public sector hit women worst', Fawcett Society, n.d., http://www.fawcettsociety.org.uk/index.asp?PageID=1236
Employee jobs survey: http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/september-2012/jobs04.xls
GMB press release, 25-10-11: http://www.gmb.org.uk/default.aspx?page=2465
Economic and fiscal outlook supplementary economy tables - March 2012, OBR, 21st March 2012, http://budgetresponsibility.independent.gov.uk/pubs/March-2012-Supplementary-tables-economy.xls
Working Women Key To Rising Living Standards, IFS and Resolution,6 Dec 2011, http://www.resolutionfoundation.org/media/media/downloads/Why_did_Britains_households_get_richer_PRESS_NOTICE.pdf
Briefing document (3,600 words) issued 19 Sep 2012
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printed 25 May 2013 at 10:55 hrs by 22.214.171.124