<p>I'm eyeballing that the unemployment rate of man rose by 3% while the rate for woman fall by 13. Clearly not all of those newly working woman replaced man.  </p>

<p>You choose a rather long period with incredible changes to the US economy; The one I think responsible for the effect you saw being the shift from manufacturing to service.</p>

<p>The Situation in 1977 can be seen on Page 10 (4 in the original numbering) of the <a href="ftp://ftp2.census.gov/econ1977/Graphic_Summary_of_the_1977_Economic_Censuses.pdf" rel="nofollow">1977 Census</a>.
It shows 44% of all employees working in manufacturing and 39% in service (Retail + "Selected services industries".</p>

<p>Contrast that to the <a href="http://www.census.gov/prod/ec97/e97cs-1.pdf" rel="nofollow">1997 Economics Census</a> (Page 20 or 14) where "Retail Trade" alone employed more people than manufacturing - and Services almost double compared to manufacturing.</p>

<p>That shift favored woman (and probably was <em>only possible</em> due to more woman choosing not be stay-at-home moms) which explains the diminishing employment gap.</p>

<p>(The methodology of those reports has changed considerably so the exact percentage rates can certainly not be compared -- but the shift is so big that the conclusion stands unchallenged)</p>

CC BY-SA 3.0
2014-12-21T15:55:42.647Z
2014-12-21T15:55:42.647Z
user45891
<p><strong>Answer:</strong><br>
From the research that I have done in order to answer this question, I believe that the following premise is flawed: </p>

<blockquote>
  <p>Presumably, this [women replacing men in the workforce] occurred when a more qualified woman got a job over a male counterpart as women entered the workforce.  </p>
</blockquote>

<p>With the hiring of women who were just as qualified (or, in some cases, less qualified) than men, we would <strong>not</strong> expect the economy to grow substantially, and we would <strong>not</strong> expect US GDP growth to outpace the world over that period.  </p>

<p><strong>My Reasoning:</strong><br>
In the early 1900s, women's rights became an important issue in the Western world.  Women began entering the work-force during World War II in order to replace the men who had gone to the fronts.  The wages of women, however, were much less than the wages paid to men (in some cases, it was only 60%).<br>
It was not until the 1960s that the women's rights movement, now called "feminism," began to gather momentum, and President Kennedy signed the <a href="http://en.wikipedia.org/wiki/Equal_Pay_Act_of_1963" rel="nofollow">Equal Pay Act of 1963</a>.  This supposedly allowed for wages to be set by the job and not influenced by the sex of the worker.  While this law reduced the wage gap, the gap continued to exist and still exists today.  </p>

<p>Let us think about hiring employees with a wage gap from an employer standpoint.  You have a vacancy in a particular position (with a wage of \$100 for men and \$80 for women) and have the option of hiring either a man or a woman.  The man can do the job 90% well (meaning that his is only worth <code>$100 * .9 = $90</code>).  The woman, on the other hand, can do the job 80% well (meaning that a man of similar skill is only worth <code>$100 * .8 = $80</code>).  Therefore, the man is worth <code>$90/$100 = 90%</code> of his salary, and the woman is worth <code>$80/$80 = 100%</code> of her salary.  Thus, the woman gets hired even though she is <strong>less</strong> qualified than the man (which is the contradiction to your premise).  </p>

CC BY-SA 3.0
2014-12-31T22:06:00.087Z
That's a contentious speculation. I like it. I don't know that's right, but it's the first time I've heard someone mention the wage gap as an incentive to reduce workforce productivity.
Jason Nichols
CC BY-SA 3.0
2015-01-01T00:29:35.330Z
You're right that desire to hire someone doesn't just depend on their productivity - what matters is productivity realtive to wages. But I don't see how this supports the conclusion that "we would not expect the economy to grow substantially" when many more women enter employment, unless you think that the marginal product of these women is zero or that they are somehow displacing men.
nominally rigid
CC BY-SA 3.0
2015-01-01T06:18:01.650Z
@nominallyrigid My conclusion basically is that women don't necessarily need to do as good a job as the men because they are paid less. As shown in my answer, a woman could do the job less efficiently and still get hired. That would not increase productivity and, therefore, would not cause the economy to grow substantially.
Mathematician
CC BY-SA 3.0
2015-01-05T06:31:04.413Z
@Mathematician, I don't understand. If women with on average 80% of the economy's existing labor productivity enter employment and increase the employment level by 1%, wouldn't we expect a 0.8% increase in output, not 0%? (Unless they displaced men, which doesn't seem likely either empirically or theoretically.)
nominally rigid
CC BY-SA 3.0
2015-01-06T14:43:10.800Z
@nominallyrigid The 80% that I use in my example is the "wellness" that the individual can do the job. The employer hires a man that can do the job better than what they are paid (110% for \$100). The man wants to get paid more than what they can do for the job (90% for \$100). The equilibrium is at 100% for $100. Woman get paid less than men. So, the employer hires a woman that can do the job better than what they are paid (110% for \$80). The woman wants to get paid more than what they can do for the job (90% for \$80). The equilibrium is at 100% for \$80.
Mathematician
CC BY-SA 3.0
2015-01-06T14:44:16.123Z
@nominallyrigid This, however, only works for a one gender workforce. When the two are in competition, and we have 100% for \$100 vs 100% for \$80, the employer will hire the woman because she can do the same work just as well for \$20 **less**.  The equilibrium in this system is that the man works 100% for \$100 and the woman works 80% for \$80. The employer finds this equal because he still gets the same amount of work per dollar.
Mathematician
CC BY-SA 3.0
2015-01-07T01:04:05.497Z
@Mathematician, don't want to have an endless discussion in comments, but I don't see how this answers my point at all, which is that _even if_, at the margin, women are less productive than men, their entry into the workforce will still increase GDP unless either their productivity is literally _zero_ or they are inducing men to exit, neither of which seems empirically true.
nominally rigid
CC BY-SA 3.0
2015-01-07T02:59:32.220Z
@nominallyrigid OK. Then I will end with this. The woman's productivity doesn't have to be zero; it just has to be less than that of the man she is replacing for GDP to decline. 
I don't see how you can say that the entry of women into the workforce **must** increase GDP. From what I have seen, it doesn't necessarily have to follow.
Mathematician
CC BY-SA 3.0
2015-01-07T03:02:42.067Z
@Mathematician, okay, great, I see our difference: "the man she is replacing". Conditional on the woman replacing a man, I agree with your logic. I simply disagree, as both a theoretical (lump of labor fallacy?) and empirical matter, with the premise that women are _on aggregate_ replacing men; see my comments on the original question.
nominally rigid
CC BY-SA 3.0
2014-12-31T22:03:15.827Z
2014-12-31T22:03:15.827Z
Mathematician
<blockquote>
<p>In the United States, women have been replacing men in the workforce, or rather were from sometime prior to 1976 until the mid-90's.</p>
</blockquote>
<p>Women have not been replacing men. Women have just increased their labor force participation (LFP) rate.</p>
<blockquote>
<p>Presumably, this occurred when a more qualified woman got a job over a male counterpart as women entered the workforce. Given that, one would expect the economy to grow substantially as overall productivity rose.</p>
</blockquote>
<p>You are probably right at this point. At least you hold the similar view with <a href="https://onlinelibrary.wiley.com/doi/full/10.3982/ECTA11427" rel="nofollow noreferrer">Hsieh, Hurst, Jones, and Klenow (2019)</a>. However there have not been enough literature to make a consensus on the level of this effect.</p>
<blockquote>
<p>Yet US GDP growth did not appear to outpace the world over that period, since not all the world liberalized their gender roles simultaneously.</p>
</blockquote>
<p>I am not sure to what extent US lead the world in rising female LFP. However I am sure that a consensus in the literature is that there is a significant improvement in this dimension around the whole world. Therefore your reasoning can be wrong in a way that US haven't benefit from this trend too much comparing to the world.</p>
<blockquote>
<p>Is there a flaw in the reasoning, or were the effects simply not visible at the scale I've looked because the data was too volatile or confounded by external factors.</p>
</blockquote>
<p>Yes, there are always other factors that can matter. For example, if you believe that countries that are far away from technological frontier can enjoy a faster growth or that countries with lower wage can benefit from international trade, these gains can offset a better female LFP trend in the most developed countries like US.</p>

CC BY-SA 4.0
2021-03-11T00:34:21.843Z
2021-03-11T00:34:21.843Z
Alalalalaki
<h1>Premise</h1>
<p>In the United States, women have been replacing men in the workforce, or rather were from sometime prior to 1976 until the mid-90's. (The general upward trend is from the recent recession, sorry, I'm recycling a graph from another presentation).</p>
<p><img src="https://i.sstatic.net/1A3FR.jpg" alt="People not working" /></p>
<p>Presumably, this occurred when a more qualified woman got a job over a male counterpart as women entered the workforce.</p>
<p>Given that, one would expect the economy to grow substantially as overall productivity rose.</p>
<p>Yet US GDP growth did not appear to outpace the world over that period, since not all the world liberalized their gender roles simultaneously.</p>
<p><img src="https://i.sstatic.net/aKCp8.png" alt="GDP Growth Rate" /></p>
<h1>Question</h1>
<p>Why is that?</p>
<p>Is there a flaw in the reasoning, or were the effects simply not visible at the scale I've looked because the data was too volatile or confounded by external factors.</p>
<p>I'd be interested in any studies that dealt with this topic and offered potential causal mechanisms for breaking the presumed link between (again, the presumed) increased efficiency, and output growth.</p>
<p>Thanks!</p>
<h1>Sources:</h1>
<ul>
<li>LNS10000001 - Civilian noninstitutional population, male</li>
<li>LNS11000001 - Civilian labor force, male</li>
<li>LNS10000002 - Civilian noninstitutional population, female</li>
<li>LNS11000002 - Civilian labor force, female</li>
<li><a href="https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&amp;ctype=l&amp;strail=false&amp;bcs=d&amp;nselm=h&amp;met_y=ny_gdp_mktp_kd_zg&amp;scale_y=lin&amp;ind_y=false&amp;rdim=region&amp;idim=country:USA&amp;ifdim=region&amp;tdim=true&amp;hl=en&amp;dl=en&amp;ind=false" rel="noreferrer">Google</a></li>
</ul>

CC BY-SA 3.0
2014-12-20T07:37:48.367Z
This is a valid and important puzzle (though the answer might ultimately be as opaque as "a productivity slowdown in the US happened to coincide with the time when women were entering the workforce"). But I don't follow your logic for why women entering the workforce would necessarily _increase_ productivity; surely it is not always true that expansion of the workforce increases productivity.
nominally rigid
CC BY-SA 3.0
2014-12-21T05:39:42.840Z
My argument is that women entering the workforce **without** increasing the workforce participation rate is indicative that they were replacing men. If they were replacing men, it follows (I believe) that it is because they were more efficient workers than the men they replaced. Consequently overall output should increase. I hypothesize they were kept out of the workforce for cultural reasons, and that once that barrier was removed they had the same (or similar) talent distribution as men, so that the top 10% of women were free to replace the bottom 10% of men (roughly) every year until parity
Jason Nichols
CC BY-SA 3.0
2014-12-21T05:49:29.830Z
ah. But is "women replacing men" an accurate description of [the time series](http://research.stlouisfed.org/fred2/graph/?g=V7B)? The secular trends in employment/population are indeed in opposite directions, but the roughly 1965-1990 period of rapidly rising female employment did not coincide with a more rapid decrease for men. (And I don't know why we would expect it to, either; that hypothesis seems lump-of-labor-ish to me.)
nominally rigid
CC BY-SA 3.0
2014-12-21T05:51:37.797Z
no, they have increased their percentage representation in the workforce: [from same earlier presentation](http://goo.gl/KJAxAy)
Jason Nichols
CC BY-SA 3.0
2014-12-21T05:53:23.010Z
I know - like I said, the very long-term trends are in opposite directions, but the period of heaviest female entry (1965-90) did not coincide with a period of unusually strong male exit. Male employment/population also declined at a similar pace both before and after the great female employment boom - [see trends here](http://research.stlouisfed.org/fred2/graph/?g=V7B).
nominally rigid
CC BY-SA 3.0
2014-12-21T05:59:26.777Z
My suspicion is that that is a short term trend since 1990 coincided with a trough in real minimum wage.[this terrible blog post I wrote last year](http://ceojasonnichols.blogspot.com/2013/12/effects-of-minimum-wage.html) shows how unemployment and minimum wage were respectively out of whack (low/high) at the end of that period of female entry. Disregard everything but the second graph. I hate everything I write 6 months after writing it. :/
Jason Nichols
CC BY-SA 3.0
2014-12-21T06:00:51.300Z
[data here](https://docs.google.com/spreadsheet/ccc?key=0Asq_UscVtgTZdHlOSWJNamg4REpXZU1LdlN4Z1BoYUE&usp=sharing)
Jason Nichols
<macroeconomics>
How did reducing the employment gender gap impact the US economy?
Jason Nichols
# How did reducing the employment gender gap impact the US economy?

(Asked by: username_0 on 2014-12-20)

# Premise

In the United States, women have been replacing men in the workforce, or rather were from sometime prior to 1976 until the mid-90's. (The general upward trend is from the recent recession, sorry, I'm recycling a graph from another presentation).

![People not working](https://i.sstatic.net/1A3FR.jpg)

Presumably, this occurred when a more qualified woman got a job over a male counterpart as women entered the workforce.

Given that, one would expect the economy to grow substantially as overall productivity rose.

Yet US GDP growth did not appear to outpace the world over that period, since not all the world liberalized their gender roles simultaneously.

![GDP Growth Rate](https://i.sstatic.net/aKCp8.png)

# Question

Why is that?

Is there a flaw in the reasoning, or were the effects simply not visible at the scale I've looked because the data was too volatile or confounded by external factors.

I'd be interested in any studies that dealt with this topic and offered potential causal mechanisms for breaking the presumed link between (again, the presumed) increased efficiency, and output growth.

Thanks!

# Sources:

* LNS10000001 - Civilian noninstitutional population, male
* LNS11000001 - Civilian labor force, male
* LNS10000002 - Civilian noninstitutional population, female
* LNS11000002 - Civilian labor force, female
* [Google](https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&ctype=l&strail=false&bcs=d&nselm=h&met_y=ny_gdp_mktp_kd_zg&scale_y=lin&ind_y=false&rdim=region&idim=country:USA&ifdim=region&tdim=true&hl=en&dl=en&ind=false)

**Tags:** macroeconomics

> **Comments:**
> **username_1**: This is a valid and important puzzle (though the answer might ultimately be as opaque as "a productivity slowdown in the US happened to coincide with the time when women were entering the workforce"). But I don't follow your logic for why women entering the workforce would necessarily _increase_ productivity; surely it is not always true that expansion of the workforce increases productivity.  
> **username_0**: My argument is that women entering the workforce **without** increasing the workforce participation rate is indicative that they were replacing men. If they were replacing men, it follows (I believe) that it is because they were more efficient workers than the men they replaced. Consequently overall output should increase. I hypothesize they were kept out of the workforce for cultural reasons, and that once that barrier was removed they had the same (or similar) talent distribution as men, so that the top 10% of women were free to replace the bottom 10% of men (roughly) every year until parity  
> **username_1**: ah. But is "women replacing men" an accurate description of [the time series](http://research.stlouisfed.org/fred2/graph/?g=V7B)? The secular trends in employment/population are indeed in opposite directions, but the roughly 1965-1990 period of rapidly rising female employment did not coincide with a more rapid decrease for men. (And I don't know why we would expect it to, either; that hypothesis seems lump-of-labor-ish to me.)  
> **username_0**: no, they have increased their percentage representation in the workforce: [from same earlier presentation](http://goo.gl/KJAxAy)  
> **username_1**: I know - like I said, the very long-term trends are in opposite directions, but the period of heaviest female entry (1965-90) did not coincide with a period of unusually strong male exit. Male employment/population also declined at a similar pace both before and after the great female employment boom - [see trends here](http://research.stlouisfed.org/fred2/graph/?g=V7B).  
> **username_0**: My suspicion is that that is a short term trend since 1990 coincided with a trough in real minimum wage.[this terrible blog post I wrote last year](http://ceojasonnichols.blogspot.com/2013/12/effects-of-minimum-wage.html) shows how unemployment and minimum wage were respectively out of whack (low/high) at the end of that period of female entry. Disregard everything but the second graph. I hate everything I write 6 months after writing it. :/  
> **username_0**: [data here](https://docs.google.com/spreadsheet/ccc?key=0Asq_UscVtgTZdHlOSWJNamg4REpXZU1LdlN4Z1BoYUE&usp=sharing)  

---

## 3 answers

### Answer by username_2 on 2014-12-21. Score: 2

I'm eyeballing that the unemployment rate of man rose by 3% while the rate for woman fall by 13. Clearly not all of those newly working woman replaced man.

You choose a rather long period with incredible changes to the US economy; The one I think responsible for the effect you saw being the shift from manufacturing to service.

The Situation in 1977 can be seen on Page 10 (4 in the original numbering) of the [1977 Census](ftp://ftp2.census.gov/econ1977/Graphic_Summary_of_the_1977_Economic_Censuses.pdf).
It shows 44% of all employees working in manufacturing and 39% in service (Retail + "Selected services industries".

Contrast that to the [1997 Economics Census](http://www.census.gov/prod/ec97/e97cs-1.pdf) (Page 20 or 14) where "Retail Trade" alone employed more people than manufacturing - and Services almost double compared to manufacturing.

That shift favored woman (and probably was *only possible* due to more woman choosing not be stay-at-home moms) which explains the diminishing employment gap.

(The methodology of those reports has changed considerably so the exact percentage rates can certainly not be compared -- but the shift is so big that the conclusion stands unchallenged)


---

### Answer by username_3 on 2014-12-31. Score: 2

**Answer:**  
From the research that I have done in order to answer this question, I believe that the following premise is flawed:

> Presumably, this [women replacing men in the workforce] occurred when a more qualified woman got a job over a male counterpart as women entered the workforce.

With the hiring of women who were just as qualified (or, in some cases, less qualified) than men, we would **not** expect the economy to grow substantially, and we would **not** expect US GDP growth to outpace the world over that period.

**My Reasoning:**  
In the early 1900s, women's rights became an important issue in the Western world. Women began entering the work-force during World War II in order to replace the men who had gone to the fronts. The wages of women, however, were much less than the wages paid to men (in some cases, it was only 60%).  
It was not until the 1960s that the women's rights movement, now called "feminism," began to gather momentum, and President Kennedy signed the [Equal Pay Act of 1963](http://en.wikipedia.org/wiki/Equal_Pay_Act_of_1963). This supposedly allowed for wages to be set by the job and not influenced by the sex of the worker. While this law reduced the wage gap, the gap continued to exist and still exists today.

Let us think about hiring employees with a wage gap from an employer standpoint. You have a vacancy in a particular position (with a wage of \$100 for men and \$80 for women) and have the option of hiring either a man or a woman. The man can do the job 90% well (meaning that his is only worth `$100 * .9 = $90`). The woman, on the other hand, can do the job 80% well (meaning that a man of similar skill is only worth `$100 * .8 = $80`). Therefore, the man is worth `$90/$100 = 90%` of his salary, and the woman is worth `$80/$80 = 100%` of her salary. Thus, the woman gets hired even though she is **less** qualified than the man (which is the contradiction to your premise).

> **Comments:**
> **username_0**: That's a contentious speculation. I like it. I don't know that's right, but it's the first time I've heard someone mention the wage gap as an incentive to reduce workforce productivity.  
> **username_1**: You're right that desire to hire someone doesn't just depend on their productivity - what matters is productivity realtive to wages. But I don't see how this supports the conclusion that "we would not expect the economy to grow substantially" when many more women enter employment, unless you think that the marginal product of these women is zero or that they are somehow displacing men.  
> **username_3**: @nominallyrigid My conclusion basically is that women don't necessarily need to do as good a job as the men because they are paid less. As shown in my answer, a woman could do the job less efficiently and still get hired. That would not increase productivity and, therefore, would not cause the economy to grow substantially.  
> **username_1**: @username_3, I don't understand. If women with on average 80% of the economy's existing labor productivity enter employment and increase the employment level by 1%, wouldn't we expect a 0.8% increase in output, not 0%? (Unless they displaced men, which doesn't seem likely either empirically or theoretically.)  
> **username_3**: @nominallyrigid The 80% that I use in my example is the "wellness" that the individual can do the job. The employer hires a man that can do the job better than what they are paid (110% for \$100). The man wants to get paid more than what they can do for the job (90% for \$100). The equilibrium is at 100% for $100. Woman get paid less than men. So, the employer hires a woman that can do the job better than what they are paid (110% for \$80). The woman wants to get paid more than what they can do for the job (90% for \$80). The equilibrium is at 100% for \$80.  
> **username_3**: @nominallyrigid This, however, only works for a one gender workforce. When the two are in competition, and we have 100% for \$100 vs 100% for \$80, the employer will hire the woman because she can do the same work just as well for \$20 **less**.  The equilibrium in this system is that the man works 100% for \$100 and the woman works 80% for \$80. The employer finds this equal because he still gets the same amount of work per dollar.  
> **username_1**: @username_3, don't want to have an endless discussion in comments, but I don't see how this answers my point at all, which is that _even if_, at the margin, women are less productive than men, their entry into the workforce will still increase GDP unless either their productivity is literally _zero_ or they are inducing men to exit, neither of which seems empirically true.  
> **username_3**: @nominallyrigid OK. Then I will end with this. The woman's productivity doesn't have to be zero; it just has to be less than that of the man she is replacing for GDP to decline.  I don't see how you can say that the entry of women into the workforce **must** increase GDP. From what I have seen, it doesn't necessarily have to follow.  
> **username_1**: @username_3, okay, great, I see our difference: "the man she is replacing". Conditional on the woman replacing a man, I agree with your logic. I simply disagree, as both a theoretical (lump of labor fallacy?) and empirical matter, with the premise that women are _on aggregate_ replacing men; see my comments on the original question.  

---

### Answer by username_4 on 2021-03-11. Score: 1

> In the United States, women have been replacing men in the workforce, or rather were from sometime prior to 1976 until the mid-90's.

Women have not been replacing men. Women have just increased their labor force participation (LFP) rate.

> Presumably, this occurred when a more qualified woman got a job over a male counterpart as women entered the workforce. Given that, one would expect the economy to grow substantially as overall productivity rose.

You are probably right at this point. At least you hold the similar view with [Hsieh, Hurst, Jones, and Klenow (2019)](https://onlinelibrary.wiley.com/doi/full/10.3982/ECTA11427). However there have not been enough literature to make a consensus on the level of this effect.

> Yet US GDP growth did not appear to outpace the world over that period, since not all the world liberalized their gender roles simultaneously.

I am not sure to what extent US lead the world in rising female LFP. However I am sure that a consensus in the literature is that there is a significant improvement in this dimension around the whole world. Therefore your reasoning can be wrong in a way that US haven't benefit from this trend too much comparing to the world.

> Is there a flaw in the reasoning, or were the effects simply not visible at the scale I've looked because the data was too volatile or confounded by external factors.

Yes, there are always other factors that can matter. For example, if you believe that countries that are far away from technological frontier can enjoy a faster growth or that countries with lower wage can benefit from international trade, these gains can offset a better female LFP trend in the most developed countries like US.


---

